An analysis of Kazakhstan and its energy sector using SAM and CGE modeling

Abstract

The primary focus of this thesis is the contribution of the oil and gas industry to Kazakhstan’s recent economic development. This industry is analyzed in a broader context with the help of the economy-wide modeling tools such as Computable General Equilibrium (CGE) model, Social Accounting Matrices (SAM) and Input-Output models. Such approach allows taking into account all possible linkages the oil and gas industry has with the rest of the economy. The first chapter presents a literature review of CGE studies with an emphasis on applications to energy and transition economies. The thesis proceeds with a description of building a CGE model for Kazakhstan and construction of the SAM. Subsequently, using the above mentioned tools Chapter Four analyses a spillover impact of the oil and gas sector on the rest of the economy. The study establishes that the sector accounted directly and indirectly for about forty percent of economic growth between 2001 and 2005. The final chapter develops an analytical framework to correct representation of the oil and gas sector in the national accounts distorted by the transfer pricing. When adjusted for transfer pricing, the GDP share of the oil and gas sector in 2001 increases to 16.1 percent compared to the officially reported 8.6 percent.