#######################
Model/3b_calibtrade.gms
#######################

.. index:: calibration, trade calibration

Calibrates bilateral trade flows, bilateral transportation costs, prices to minimize deviation with observations for 2000
and at the same time ensures that for the base year of the model (2000):

       1. the sum of bilateral trade flows for a region matches with the FAO net trade (after potential adjustments of demand in 3_precompute) = equation h
       2. if there is a bilateral trade flow between two regions, the price in the importing region should be equal to the price in the exporting region
          plus all trade costs (tariff and transportation cost) = equation dx

Included files specific to trade calibration:

       - ``base_trade.gms`` contains input trade data aggregated from country to GLOBIOM regions and HS6 products to GLOBIOM products
       - ``comptrade.gms``
       - ``calibtrade.gms`` launches trade calibration procedure product by product
       - ``calc_nettrade.gms`` computes the net trade as it should be in the model i.e. based on FAOSTAT after potential demand/supply adjustments from model calibration

Based on `Jansson & Heckelei 2009 <https://doi.org/10.1016/j.econmod.2008.10.002>`_.

********
Includes
********

.. toctree::
   :maxdepth: 1

   calc_tuples
   finaldata/base_trade
   finaldata/base_trade_2010
   finaldata/base_trade_2020
   trade/calc_nettrade
   trade/calibtrade
   trade/comptrade

********
Comments
********

Some useful checks can be made to ensure that trade calibration has worked (in the 3b_calibtrade.lst file or in the gdx):

- tottrade is always = 0   => the net trade equals the sum of the computed bilateral trade flows
- sh_impprice2 = 0   => the difference between prices equal trasnport cost plus tariff if there is a trade flow

If at the end of the compilation it is written: trade calibration complete with errors:

- open the log and look for "infeasible" => allows you to identify for which product there is a problem
- then usually you will also have some problem with tottrade => will give you the regions where there is a problem
- check net trade, initial bilateral trade flows and prices for this region and product