Empowering Policy through CGE Modelling: A Trainer of Trainers workshop

Authors: Shadrack Mwatu and Juneweenex Mbuthia

In July and August 2025, the Kenya Institute for Public Policy Research and Analysis (KIPPRA), in collaboration with the International Food Policy Research Institute (IFPRI), conducted a ten-day intensive training of trainers’ workshop on Computable General Equilibrium (CGE) modelling under the CGIAR Policy Innovations program. Held at KIPPRA’s offices, the training brought together technical staff from across the Institute to strengthen institutional capacity in economy-wide analysis and enhance the use of evidence in policy formulation. The training was designed to provide participants with a comprehensive understanding of social accounting matrices (SAMs), SAM-based multiplier techniques, and the structure and application of CGE models to assess the macroeconomic and welfare impacts of policy interventions.

The program began on Monday, 21st July 2025, with a welcoming session and an overview of the training objectives. Facilitators from both KIPPRA and IFPRI introduced participants to key economic concepts and definitions, setting the foundation for the rest of the training. The sessions that followed provided an in-depth introduction to Social Accounting Matrices (SAMs) and their relevance to policy analysis. Through a mix of lectures and group exercises, participants explored the structure of SAMs and how they are used to represent the flow of income and expenditure within an economy. By the end of the first few days, trainees had gained hands-on experience in building SAMs and performing both macro and micro-level analyses.

As the training progressed into the second and third days, the focus shifted to SAM multiplier analysis and the computation of round-by-round effects to trace the transmission of policy shocks across sectors. The participants actively engaged in exercises that demonstrated how public spending or tax policy changes could influence household incomes, production, and employment in different sectors. These sessions laid the groundwork for a deeper dive into economy-wide modelling using CGE techniques. On the fourth and fifth days, the participants were introduced to Input-Output analysis and how it compares with SAM-based multiplier models. They were also guided through Kenya’s simple 1-2-3 CGE model, which provided a practical entry point into CGE modelling using real data and local policy contexts.

In the second week, the training took a more technical turn as participants delved into the structure and functionality of CGE models. The sessions covered model components, functional equations, and calibration techniques. Participants learned how to program basic CGE models using platforms such as GAMS and Excel. These hands-on exercises included building and calibrating simple models, participants developed the capacity to simulate the economic effects of different policy options and interpret the results meaningfully.

The latter part of the training focused on applying CGE models to real-world policy questions. Participants were introduced to simulation design, running model scenarios, and interpreting model results. Practical examples included policy impacts related to trade, taxation, and agriculture. A case study on CGE analysis in the Kenyan context showcased how these models could be applied to inform and guide policy decisions. On the final day, the training emphasized how to effectively communicate CGE results to policymakers and other stakeholders. Participants reflected on how their analytical work could influence policy when presented clearly and aligned with decision making needs. The training concluded with group presentations, feedback sessions, and discussions on how to integrate CGE modelling into KIPPRA’s broader research agenda.

This CGE training represents a significant investment in KIPPRA’s internal capacity-building efforts. By equipping its technical staff with advanced modelling skills and practical tools, the Institute is now better positioned to deliver robust, evidence-based analysis to inform public policy. The use of CGE models enhances the ability to evaluate policy trade-offs and understand the distributional impacts of economic reforms. As Kenya continues to pursue its development goals amidst complex global and domestic challenges, the application of such analytical tools will be critical in designing inclusive, effective, and sustainable policy solutions. Through initiatives like this, KIPPRA reaffirms its commitment to being at the forefront of data-driven policy analysis for national development.

Authors: Shadrack Mwatu is a Senior Policy Analyst, Trade and Foreign Policy Department, Kenya Institute for Public Policy Research and Analysis (KIPPRA); Juneweenex Mbuthia, is a Research Officer, Development Strategies and Governance Unit, International Food Policy Research Institute (IFPRI), based in Nairobi, Kenya.