Abstract
This study aims at providing a simple prototype Spatial Computable General Equilibrium (SCGE) model with a Nested Constant Elasticity of Substitution (NCES) system. The SCGE model developed here is based on the Global Trade Models, one of the most important applications of the Computable General Equilibrium (CGE) model. The NCES system is obtained by nesting a series of CES functions, which is useful to describe various levels of elasticities of substitution between different kinds of goods in the same category. The SCGE model is formulated in the way that a Newton-Raphson method can be used in its process of equilibrating prices. Thus, the resultant model may be operational and provide a generalization of the traditional interregional Input-Output analysis.