Defining efficient policies in a general equilibrium model: a multi-objective approach

Macroeconomic policy makers are typically concerned with several indicators of economic performance. We thus propose to tackle the design of macroeconomic policy using Multicriteria Decision Making (MCDM) techniques. More specifically, we employ Multiobjective Programming (MP) to seek so-called efficient policies. The MP approach is combined with a computable general equilibrium (CGE) model. We chose use of a CGE model since they have the dual advantage of being consistent with standard economic theory while allowing one to measure the effect(s) of a specific policy with real data. Applying the proposed methodology to Spain (via the 1995 Social Accounting Matrix) we first quantified the trade-offs between two specific policy objectives: growth and inflation, when designing fiscal policy. We then constructed a frontier of efficient policies involving real growth and inflation. In doing so, we found that policy in 1995 Spain displayed some degree of inefficiency with respect to these two policy objectives. We then offer two sets of policy recommendations that, ostensibly, could have helped Spain at the time. The first deals with efficiency independent of the importance given to both growth and inflation by policy makers (we label this set: general policy recommendations). A second set depends on which policy objective is seen as more important by policy makers: increasing growth or controlling inflation (we label this one: objective-specific recommendations).

Design of maintenance structures for rural electrification with solar home systems. The case of the Moroccan program.

n decentralised rural electrification through solar home systems, private companies and promoting institutions are faced with the problem of deploying maintenance structures to operate and guarantee the service of the solar systems for long periods (ten years or more). The problems linked to decentralisation, such as the dispersion of dwellings, difficult access and maintenance needs, makes it an arduous task. This paper proposes an innovative design tool created ad hoc for photovoltaic rural electrification based on a real photovoltaic rural electrification program in Morocco as a special case study. The tool is developed from a mathematical model comprising a set of decision variables (location, transport, etc.) that must meet certain constraints and whose optimisation criterion is the minimum cost of the operation and maintenance activity assuming an established quality of service. The main output of the model is the overall cost of the maintenance structure. The best location for the local maintenance headquarters and warehouses in a given region is established, as are the number of maintenance technicians and vehicles required.