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Can Trade Help Poor People? The Role of Trade, Trade Policy and Market Access in Tanzania

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  • Burcu Duygan
  • Jesse B. Bump
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    Abstract

    Many development economists prescribe trade as a poverty-reducing formula. But how is this elixir supposed to work? This article contributes to the lively debate on this topic with household evidence from Tanzania - a poor country even within sub-Saharan Africa, the poorest region. About 81% of the poor work in agriculture, which accounts for 88% of the export bundle. The article describes existing poverty and then evaluates the poverty-reduction potential of trade, trade policy and market access. The article extends the analysis by simulating tariff changes and four switching scenarios that swap some poor households into trade-related sectors, such as cash cropping or tourism, to project national poverty reductions of up to 5.6% and household income increases of up to 21.5%. Copyright 2007 Blackwell Publishing Ltd.

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    Bibliographic Info

    Article provided by Overseas Development Institute in its journal Development Policy Review.

    Volume (Year): 25 (2007)
    Issue (Month): 3 (05)
    Pages: 293-310

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    Handle: RePEc:bla:devpol:v:25:y:2007:i:3:p:293-310

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