Update expenditure for Mahlkow and Wanner (2021) — update_expenditure_mw

Solves for tax-inclusive expenditure as [update_expenditure_cp_2015()], with suppliers receiving expenditure net of the tax wedge and the tax revenue as part of income. [process_results()] uses it for the initial expenditure.

update_expenditure_mw_2021(
  expenditure_new,
  consumption_share,
  input_share,
  trade_share_new,
  tariff_new,
  export_subsidy_new,
  tax_new,
  value_added,
  wage_change,
  trade_balance_new,
  model_dimensions,
  tolerance,
  verbose,
  convergence_method,
  max_inner_iterations = 5000L
)

Arguments

expenditure_new: Matrix of new expenditures, dimensions: country x sector.
consumption_share: Matrix of consumption shares, dimensions: country x sector.
input_share: Array of beta-multiplied input-output coefficients, dimensions: country x input x output.
trade_share_new: Array of new trade shares, dimensions: origin x destination x sector.
tariff_new: Array of new tariffs, dimensions: origin x destination x sector.
export_subsidy_new: Array of export subsidies, dimensions: origin x destination x sector.
tax_new: Matrix of new tax wedges, dimensions: country x sector.
value_added: Vector of value added, dimension: country.
wage_change: Vector of change in wages, dimension: country.
trade_balance_new: Vector of new aggregate trade balance, dimension: country.
model_dimensions: List of model dimensions.
tolerance: Tolerance for inner convergence.
verbose: Verbosity level.
convergence_method: Method for convergence checking.
max_inner_iterations: Maximum number of inner iterations before the loop bails out (default 5000).

Value

List with `expenditure_new` (country x sector), `n_iterations_expenditure_update` and `inner_converged`.