Interest rates are used in MAgPIE as a risk-accounting factor associated with investment activities (Wang et al. 2016). Interest rates are required for inter-temporal calculations in the model such as shifting investment from one time step to another or distribution of one-time investments over several time steps (e.g. in the modules 13_tc, 39_landconversion and 41_area_equipped_for_irrigation).
| Description | Unit | A | |
|---|---|---|---|
| im_development_state (t_all, i) |
Development state according to the World Bank definition where 0=low income country 1=high income country in high income level | \(1\) | x |
| im_pop_iso (t_all, iso) |
Population | \(10^6/yr\) | x |
| Description | Unit | |
|---|---|---|
| pm_interest (t_all, i) |
Interest rate in each region and timestep | \(\%/yr\) |
The select_apr20 realization allows to flexibly choose regional or global interest rates. In the default setting, the interest rate depends on the development state im_development_state, which is calculated based on GDP per capita. Thus, interest rates are regionally specific and dynamic over time. Alternative interest rates can be selected via the interest rate coefficients (s12_interest_lic, s12_interest_hic, s12_hist_interest_lic, s12_hist_interest_hic). The future interest rate policy fades in starting from 2025 until it is fully in effect by 2050. It is also possible to choose a global interest rate.
Limitations There are no known limitations.
| Description | Unit | A | |
|---|---|---|---|
| f12_interest_fader (t_all) |
Protection scenario fader | \(1\) | x |
| p12_country_dummy (iso) |
Dummy parameter indicating whether country is affected by interest rate scenario | \(1\) | x |
| p12_reg_shr (t_all, i) |
Weighted share of region with regards to interest rate scenario of countries | \(1\) | x |
| s12_hist_interest_hic | Historic interest rate in high income countries | \(1\) | x |
| s12_hist_interest_hic_noselect | Historic interest rate in high income countries for nonselected countries only active when regional switch activated | \(1\) | x |
| s12_hist_interest_lic | Historic interest rate in low income countries | \(1\) | x |
| s12_hist_interest_lic_noselect | Historic interest rate in low income countries for nonselected countries only active when regional switch activated | \(1\) | x |
| s12_interest_hic | Interest rate in high income countries | \(1\) | x |
| s12_interest_hic_noselect | Interest rate in high income countries for nonselected countries only active when regional switch activated | \(1\) | x |
| s12_interest_lic | Interest rate in low income countries | \(1\) | x |
| s12_interest_lic_noselect | Interest rate in low income countries for nonselected countries only active when regional switch activated | \(1\) | x |
| description | |
|---|---|
| i | all economic regions |
| i_to_iso(i, iso) | mapping regions to iso countries |
| iso | list of iso countries |
| select_countries12(iso) | countries to be affected by chosen interest rate scenario |
| t_all(t_ext) | 5-year time periods |
Xiaoxi Wang
09_drivers, 12_interest_rate, 13_tc, 32_forestry, 38_factor_costs, 39_landconversion, 41_area_equipped_for_irrigation, 56_ghg_policy, 58_peatland
Wang, Xiaoxi, Anne Biewald, Jan Philipp Dietrich, Christoph Schmitz, Hermann Lotze-Campen, Florian Humpenöder, Benjamin Leon Bodirsky, and Alexander Popp. 2016. “Taking Account of Governance: Implications for Land-Use Dynamics, Food Prices, and Trade Patterns.” Ecological Economics 122 (February): 12–24. https://doi.org/10.1016/j.ecolecon.2015.11.018.