Regional Economic Models, Inc. (REMI) model
The REMI model is a dynamic forecasting and policy analysis tool that can be variously referred to as an econometric model, an input-output model, or even a computable general equilibrium model. The model forecasts the future of a regional economy, and it predicts the effects on that same economy when the user implements a change. REMI models have been used throughout the world for a wide range of topic areas, including economic development, the environment, energy, transportation, and taxation, forecasting, and planning.
The REMI model incorporates aspects of four major modeling approaches:
- General equilibrium,
- Economic geography.
Each of these methodologies has distinct advantages as well as limitations when used alone. The REMI integrated modeling approach builds on the strengths of each of these approaches.
The REMI model at its core, has the inter-industry relationships found in Input-Output models. As a result, the industry structure of a particular region is captured within the model, as well as transactions between industries. Changes that affect industry sectors that are highly interconnected to the rest of the economy will often have a greater economic impact than those for industries that are not closely linked to the regional economy.
General equilibrium is reached when supply and demand are balanced. This tends to occur in the long run, as prices, production, consumption, imports, exports, and other changes occur to stabilize the economic system. For example, if real wages in a region rise relative to the U.S., this will tend to attract economic migrants to the region until relative real wage rates equalize. The general equilibrium properties are necessary to evaluate changes such as tax policies that may have an effect on regional prices and competitiveness.
Key questions addressed:
- What effect would Policy X have on the economy?
- Which projects warrant tax incentives?
Sample data inputs:
- Energy, environment, policy, taxation and economic data
Sample quantitative outputs:
- Macroeconomic effects of policies
Access the REMI model.