“On the Marginal Cost of Public Funds for Argentina: CGE Evaluation and Sensitivity to Regulatory Regimes”

We estimate the Marginal Cost of Public Funds for Argentina using a computable general equilibrium (CGE) model, assessing the sensitivity of the results to the existence of alternative regulatory regimes (Price-Cap and Cost-Plus) for public utilities subject to regulation. Although the estimates are in the range of international studies, we find that the results are sensitive to the regulatory regime, to the presence of exempted goods, the existence of unemployment, the value of the elasticity of labor supply, as well as to the degree of capital mobility, between sectors and internationally.