The Two-Sector General Equilibrium Model: Numerical and Graphical Representations of an Economy

Volume 1, Issue 3
Winter 1991

This article describes a method of obtaining a numerical solution of the two-sector general equilibrium model, an economic system having two commodities and two production factors. In addition, the graphical representation of equilibrium solutions using two common geometrical tools, the Edgeworth-Bowley box diagram and the production-possibilities curve, is handled by Mathematica's graphical functions. Program extensions for more complex economic models, e.g., an economic growth model, an open economic model and a multicommodity model are also described.