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Does Trade Liberalization Promote Regional Disparities? Evidence from a Multiregional CGE Model of India

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  • Naranpanawa, Athula
  • Arora, Rashmi

Abstract

Over last few decades, there has been a growing interest among researchers in understanding the link between trade liberalization and regional disparities within the context of an individual country. In this study, we develop the first ever single-country multiregional Computable General Equilibrium (CGE) model for the Indian economy to investigate this linkage. Overall our results suggest that, in the short run, trade liberalization has a beneficial impact on the rich and fast-growing middle-income states and a marginal or negative impact on the poor states.

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  • Naranpanawa, Athula & Arora, Rashmi, 2014. "Does Trade Liberalization Promote Regional Disparities? Evidence from a Multiregional CGE Model of India," World Development, Elsevier, vol. 64(C), pages 339-349.
    • Handle: RePEc:eee:wdevel:v:64:y:2014:i:c:p:339-349
    DOI: 10.1016/j.worlddev.2014.06.001
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