The structural equation system for the overall national economy must be able to systematically comprehend the general trend of the complicated national economy, and determine the effect of various types of economic policies or the changes an economic system has on economic variables. The Computable General Equilibrium(CGE) is expressed as an equation system describing the general balance of the economy, which enables researchers make a concrete assumption on the government’s economic policies, production factor, preference relationship and production technologies into an abstract general equilibrium. Thus, many researchers consider the CGE model as a realistic form of the general equilibrium theory and a useful tool in analyzing economic effects depending on system changes or economic policies in the light of general equilibrium.
Recent studies show that innovations in technology and manpower serve as motivational force for continuous economic growth and accelerate the expansion of superior manpower by investing in education and training in the light of nation is a precondition for continuous innovation. Meanwhile, formulating policies related to manpower should be preceded with the appreciation of the policy effect appearing in various different sectors after systematically determining the overall national economy. In this study, to supplement this aspect, we tried to develop and expand the standard CGE model, which has much utility in policy research. This study’s main contents consist of the development of the Social Accounting Matrix(SAM) and the CGE model reflecting skill structure.
First, the Social Accounting Matrix(SAM) is the table in which connections related to production, consumption and accumulation in a certain economy are arranged so that the sum of each line can coincide with that of each row using the matrix accounting system composed of accounts with identical lines and rows. Thus, information concerning economic and social structures in a certain country and region are consistently organized, thereby providing a statistical basis for the CGE model.
In the CGE model, as connection relations, functional form and setting of variables that significantly affect the results of policy analysis are determined by the researcher, the model is diversified according to the researcher’s temperament and intention. As a result, the model is sensitive to such factors. In addition, the estimation of various parameters is required in the deciding process of production function, consumption function and export/import in order to develop an effective model. This aspect should be supported with microscopic research. Also, related economic variables and policy tools should precede an effective analysis of skill policies in the near future. If the CGE model is utilized in policy analysis, considering the abovementioned remarks, it can be safely concluded that the CGE model can provide useful information in making an investigation of various policy alternatives.