Reports
Discussion Papers
No.874 Simulating the decoupling world under Russia’s invasion of Ukraine: An application of IDE-GSM
by Satoru Kumagai, Kazunobu Hayakawa, Ikumo Isono, Toshitaka Gokan, Souknihlan Keola, Kenmei Tsubota and Hiroya Kubo
January 2023
ABSTRACT
The world appears to be divided into three blocs: the Chinese–Russian bloc, the Western alliance, and the rest of the world that remains neutral in the conflict between the former camps. This study estimates the economic impacts of “decoupling” scenarios on each country and region using a computable general equilibrium (CGE)-type simulation model called the geographical simulation model developed by the Institute of Developing Economies (IDE-GSM). Simulation results indicate that 1) the decoupling of Russia will not have a significant impact on the global economy, except in the mining sector, and 2) if China joins the Russian camp, the impact will be significant on the world economy, especially for Asian countries.
Keywords: Decoupling of the world, Simulation analysis, IDE-GSM
JEL classification: E27, F17, R12
PDF available at http://hdl.handle.net/2344/00053560
Please note that discussion papers are works in various stages of progress and most have not been edited and proofread and may contain errors of fact or judgment. Revised versions of these papers may subsequently appear in more formal publication series. The views expressed in this publication are those of the author(s). The IDE does not guarantee the accuracy of the data included and accepts no responsibility for any consequences arising from its use.