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Posted: Tue Jun 04, 2019 9:43 am
by lulitmitik
It is a very interesting topic. The researchers have made a lot of progress from their first proposal to this final report.
The abstract could indicate better which policies are analyzed in the paper. The analysis tool should be mentioned as well. The results also briefly explained.
Literature review
Missing the link between the literature review and the objective of the paper. What is missing in the literature on conflict and post-conflict Colombia and other countries that experienced the same situation? What are the key messages we can draw from the literature review? What does your paper contribute to the literature? Any CGE analysis on the topic of interest in Colombia or other similar countries?

An important effort has been made to build the SAM and to disaggregate the activities by level of conflict and size. This very high level of disaggregation ought to be put in context of the policy considered. As there are many dimensions, would this allow to capture the key messages of the impact analysis? In particular, because the share of the agricultural sector in GDP seems to be small. Is this not because the illicit sector is not included? The tables could be aggregated by main industry.
The CGE model
Develop a bit more the agricultural component as it is the main feature of your model. The closure rules are not clear. Discuss the assumption on the three major macro closure: investment-saving, government accounts, rest of the world accounts.
Application and results
For both scenarios, how do you incorporate the simulations in the CGE model?
Does it really make sense to make households pay for the policy as they have already suffered much? Is it all households?
You basically have near zero effect on macro variables and negative impacts on households. Notable impacts are on exports of coffee and production of corn.
Need to revise labor mobility assumptions. Corn workers end up in the public sector!
You have an increase in employment in the public sector probably because your simulation consists in increasing government current expenditure. Is this what you meant? You mention investment in your paper so that would be one of your policy variables?
Is there labor migration between municipalities? Or do you have a segmented labor market?
Table 10- is this the impact on sectoral GDP relative to the baseline? If so, as the impact seems t o be important, it would be interesting to have a table reflecting the contribution of the two sectors to national GDP.
So a policy aimed at improving the lives of the rural populations affected by the conflict ends up worsening their situation? We are missing something here. Does the policy need to be budget neutral? Are there no other sources of public expenditure finance? I would recommend you run the simulations with alternative closure rules. Also, the transmission mechanism could be better captured if the simulations are better specified that an increase in TFP following a public expenditure policy. If you have investment type of policies, this would have other effects as well.