The macroeconomic, industrial and distributional effects of removing tariffs in Bangladesh
AbstractThis paper examines the economic effects of removing tariffs in Bangladesh using a computable general equilibrium (CGE) modelling approach. The results of the simulations indicate that in the short-run a funded tariff cut with fixed real national savings would increase employment slightly and hence would expand GDP. There would be a small economy-wide welfare gain as measured by real consumption. The sectoral results showed that export-oriented industries would experience an expansion in output and employment. There also would be positive effects on the suppliers to these industries. Lightly-protected industries, which rely heavily on imported intermediate inputs, are projected to show robust expansion as they would benefit from a cost reduction. However, highly-protected, import-competing industries would suffer a contraction in output and employment as they would face increased competition from imports due to the removal of tariffs. The simulation results also indicate that there would have some noticeable effects on the distribution of real consumption between different household groups. Overall, urban households would experience an expansion in real consumption and rural households would suffer a contraction as a consequence of the funded tariff cut with fixed real national savings.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 9577.
Date of creation: Jan 2008
Date of revision:
CGE model; trade liberalisation; income distribution; Bangladesh;
Other versions of this item:
- Serajul Hoque, 2008. "The Macroeconomic, Industrial and Distributional Effects of Removing Tariffs in Bangladesh," Centre of Policy Studies/IMPACT Centre Working Papers g-170, Victoria University, Centre of Policy Studies/IMPACT Centre.
- F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
- C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
- O15 - Economic Development, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-07-20 (All new papers)
- NEP-CMP-2008-07-20 (Computational Economics)
- NEP-DEV-2008-07-20 (Development)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Nabil Annabi & H. Khondker Bazlul & Selim Raihan & John Cockburn & Bernard Decaluwe, 2005. "Implications of WTO Agreements and Domestic Trade Policy Reforms for Poverty in Bangladesh: Short vs. Long Run," Working Papers MPIA 2005-02, PEP-MPIA.
- Decaluwe, Bernard & Martens, Andre, 1988.
"CGE modeling and developing economies: A concise empirical survey of 73 applications to 26 countries,"
Journal of Policy Modeling,
Elsevier, vol. 10(4), pages 529-568.
- Decaluwe, B. & Martens, A., 1988. "Cge Modeling And Developing Economies: A Concise Empirical Survey Of 73 Applications To 26 Countries," Papers 8816, Laval - Recherche en Politique Economique.
- David Dollar & Aart Kraay, 2004.
"Trade, Growth, and Poverty,"
Royal Economic Society, vol. 114(493), pages F22-F49, 02.
- Peter B. Dixon & Maureen T. Rimmer & Marinos E. Tsigas, 2004. "Macro, industry and state effects in the U.S. of removing major tariffs and quotas," Centre of Policy Studies/IMPACT Centre Working Papers g-146, Victoria University, Centre of Policy Studies/IMPACT Centre.
- Fontana, Marzia & Wobst, Peter & Dorosh, Paul A., 2001. "Macro policies and the food sector in Bangladesh," TMD discussion papers 73, International Food Policy Research Institute (IFPRI).
- Bandara, Jayatilleke S, 1991. " Computable General Equilibrium Models for Development Policy Analysis in LDCs," Journal of Economic Surveys, Wiley Blackwell, vol. 5(1), pages 3-69.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ekkehart Schlicht).
If references are entirely missing, you can add them using this form.