Calibrates bilateral trade flows, bilateral transportation costs, prices to minimize deviation with observations for 2000 and at the same time ensures that for the base year of the model (2000):

  1. the sum of bilateral trade flows for a region matches with the FAO net trade (after potential adjustments of demand in 3_precompute) = equation h

  2. if there is a bilateral trade flow between two regions, the price in the importing region should be equal to the price in the exporting region plus all trade costs (tariff and transportation cost) = equation dx

Included files specific to trade calibration:

  • base_trade.gms contains input trade data aggregated from country to GLOBIOM regions and HS6 products to GLOBIOM products

  • comptrade.gms

  • calibtrade.gms launches trade calibration procedure product by product

  • calc_nettrade.gms computes the net trade as it should be in the model i.e. based on FAOSTAT after potential demand/supply adjustments from model calibration

Based on Jansson & Heckelei 2009.


Some useful checks can be made to ensure that trade calibration has worked (in the 3b_calibtrade.lst file or in the gdx):

  • tottrade is always = 0 => the net trade equals the sum of the computed bilateral trade flows

  • sh_impprice2 = 0 => the difference between prices equal trasnport cost plus tariff if there is a trade flow

If at the end of the compilation it is written: trade calibration complete with errors:

  • open the log and look for “infeasible” => allows you to identify for which product there is a problem

  • then usually you will also have some problem with tottrade => will give you the regions where there is a problem

  • check net trade, initial bilateral trade flows and prices for this region and product