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On Trade Policy Reform and the Missing Revenue: an Application to Mozambique

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Author Info

  • Channing Arndt

    (Purdue University)

  • Finn Tarp

    (Institute of Economics, University of Copenhagen)

Abstract

In many developing countries, large discrepancies exist between revenues implied by published tariff rates multiplied by estimated import volumes and actual receipts. We develop a stylized trade model where average and marginal tariff rates diverge and incorporate insights from this model into a computable general equilibrium model of Mozambique to study the implications of trade policy reform. Model simulations indicate that lowering tariff rates and reducing duty free importation in a manner that maintains official revenue benefits nearly everyone with the main exception being those, who benefited from duty free imports in the base.

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File URL: http://www.econ.ku.dk/english/research/publications/wp/2004/0419.pdf/
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Bibliographic Info

Paper provided by University of Copenhagen. Department of Economics in its series Discussion Papers with number 04-19.

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Length: 26 pages
Date of creation: Oct 2004
Date of revision:
Handle: RePEc:kud:kuiedp:0419

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Keywords: trade policy; public revenue; Mozambique;

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Cited by:
  1. Channing Arndt & Sherman Robinson & Finn Tarp, 2006. "Trade Reform and Gender in Mozambique," Nordic Journal of Political Economy, Nordic Journal of Political Economy, vol. 32, pages 73-89.
  2. Arndt, Channing, 2005. "The Doha Trade Round and Mozambique," Policy Research Working Paper Series 3717, The World Bank.

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