Towards the inclusion of power dynamics within integrated modelling: an illustration using the World Trade Model

Master thesis (2024)

Authors

C. Drotenko Technology, Policy and Management

Contributors

Ranran Wang Universiteit Leiden (mentor)
Rutger Hoekstra Universiteit Leiden (mentor)
Faculty
Technology, Policy and Management
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Published Date

02-09-2024

Language

English

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Faculty

Technology, Policy and Management

Abstract

Power dynamics play a crucial role in inhibiting and advancing various policies, from climate action to wage negotiations. However, current integrated models addressing socio-economic and environmental issues often fail to account for the underlying drivers of these power dynamics, thereby illuminating a significant literature gap. This omission limits the ability of the models to capture real-world complexities and may hinder effective policy design.

This paper addresses this gap by exploring how power dynamics can be incorporated within integrated models which deal with socio-economic and environmental problems. It begins with a proof of concept, demonstrating how a specific type of power dynamic, namely labour union bargaining power, can be included into the World Trade Model (WTM), a dynamic form of Input-Output Analysis. This integration is coupled with supplementary research that explains the drivers of said power dynamic in order to address the literature gap. Notably, this paper has made additional contributions by being the first instance of power dynamics included in the WTM, developing new code to convert the WTM into a Multi-Regional Input-Output format to advance the field of dynamic Input-Output Analysis, and clearly documenting this code which was previously missing.

Additionally, the paper outlines a future research strategy focused on two main areas: including power dynamics as inputs to integrated models with parallel research on the drivers of the power dynamics evaluated, and also contains ideas on how to take steps to model the power relationships between actors themselves. This approach holds promise for providing a deeper understanding of how power dynamics influence socio-economic and environmental outcomes. The author advocates for further research to ensure power dynamics are not overlooked in models in order to have a more comprehensive representation of systemic issues.