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Gains from Trade: Implications for Labour Market Adjustment and Poverty Reduction in Africa

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  • Fosu, Augustin Kwasi
  • Mold, Andrew

Abstract

This paper reassesses the gains from trade for sub-Saharan Africa, and draws their implications for labour market adjustment and poverty reduction. It reviews previous studies on multilateral liberalization, focusing on the findings from computable general equilibrium (CGE) models with relevance to African economies. The implications of these findings for poverty reduction are discussed. Our own CGE exercise supports the hypothesis that African countries cannot expect substantial gains from further multilateral liberalization. Moreover, given the sharp contraction of import-competing sectors in response to trade liberalization in many African economies, coupled with insufficient compensation through labour market adjustments in other sectors, this study suggests that the ultimate impact on poverty reduction is likely to be small or even negative.

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File URL: http://www.wider.unu.edu/stc/repec/pdfs/rp2007/rp2007-65.pdf
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Bibliographic Info

Paper provided by World Institute for Development Economic Research (UNU-WIDER) in its series Working Paper Series with number UNU-WIDER Research Paper RP2007/65.

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Length: 26 pages
Date of creation: 2007
Date of revision:
Handle: RePEc:unu:wpaper:rp2007-65

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Related research

Keywords: trade; openness; liberalization; poverty reduction;

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Cited by:
  1. Hisako KAI & Shigeyuki HAMORI, 2009. "Globalization, Financial Depth, and Inequality in Sub-Saharan Africa," Discussion Papers 0912, Graduate School of Economics, Kobe University.
  2. Pamela Coke Hamilton & Yvonne Tsikata & Emmanuel Pinto Moreira, 2009. "Accelerating Trade and Integration in the Caribbean : Policy Options for Sustained Growth, Job Creation, and Poverty Reduction," World Bank Publications, The World Bank, number 2652, July.
  3. Maertens, Miet & Colen, Liesbeth & Swinnen, Johan F.M., 2009. "Globalization and Poverty in Senegal: A Worst Case Scenario?," 2009 Conference, August 16-22, 2009, Beijing, China 51668, International Association of Agricultural Economists.
  4. John Anyanwu, 2013. "Working Paper 181 - Determining the Correlates of Poverty for Inclusive Growth in Africa," Working Paper Series 979, African Development Bank.

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