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Household welfare impacts of China's accession to the World Trade Organization

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  • Chen, Shaohua
  • Ravallion, Martin

Abstract

The authors use China's national household surveys for rural and urban areas to measure and explain the welfare impacts of the changes in goods and factor prices attributed to WTO accession. Price changes are estimated separately using a general equilibrium model to capture both direct and indirecteffects of the initial tariff changes. The welfare impacts are first-order approximations based on a household model incorporating own-production activities and are calibrated to the household-level data imposing minimum aggregation. The authors find negligible impacts on inequality and poverty in the aggregate. However, diverse impacts emerge across household types and regions associated with heterogeneity in consumption behavior and income sources, with possible implications for compensatory policy responses.

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Bibliographic Info

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 3040.

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Date of creation: 31 May 2003
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Handle: RePEc:wbk:wbrwps:3040

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Keywords: Labor Policies; Environmental Economics&Policies; Payment Systems&Infrastructure; Economic Theory&Research; Health Economics&Finance; Poverty Lines; Inequality; Health Economics&Finance; Environmental Economics&Policies; Economic Theory&Research;

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References

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  1. Branko Milanovic, 2003. "Can We Discern The Effect Of Globalization On Income Distribution? Evidence From Household Surveys," HEW 0310002, EconWPA.
  2. Barro, Robert J, 2000. " Inequality and Growth in a Panel of Countries," Journal of Economic Growth, Springer, vol. 5(1), pages 5-32, March.
  3. Dollar, David & Kraay, Aart, 2001. "Growth is good for the poor," Policy Research Working Paper Series 2587, The World Bank.
  4. Jalan, Jyotsna & Ravallion, Martin, 1998. "Transient Poverty in Postreform Rural China," Journal of Comparative Economics, Elsevier, vol. 26(2), pages 338-357, June.
  5. Chen, Shaohua & Ravallion, Martin, 1996. "Data in transition: Assessing rural living standards in Southern China," China Economic Review, Elsevier, vol. 7(1), pages 23-56.
  6. Jyotsna Jalan & Martin Ravallion, 1999. "China's Lagging Poor Areas," American Economic Review, American Economic Association, vol. 89(2), pages 301-305, May.
  7. L. Alan Winters & Neil McCulloch & Andrew McKay, 2004. "Trade Liberalization and Poverty: The Evidence So Far," Journal of Economic Literature, American Economic Association, vol. 42(1), pages 72-115, March.
  8. Hongyi Li & Lyn Squire & Heng-fu Zou, 1998. "Explaining International and Intertemporal Variations in Income Inequality," CEMA Working Papers 73, China Economics and Management Academy, Central University of Finance and Economics.
  9. Edwards, Sebastian, 1997. "Trade Policy, Growth, and Income Distribution," American Economic Review, American Economic Association, vol. 87(2), pages 205-10, May.
  10. Bob Baulch & John Hoddinott, 2000. "Economic mobility and poverty dynamics in developing countries," Journal of Development Studies, Taylor & Francis Journals, vol. 36(6), pages 1-24.
  11. Bourguignon, F. & Morrisson, C., 1989. "Income Distribution, Development and Foreign Trade: A Cross-Sectional Analysis," DELTA Working Papers 89-05, DELTA (Ecole normale supérieure).
  12. Ravallion, Martin, 1990. "Rural Welfare Effects of Food Price Changes under Induced Wage Responses: Theory and Evidence for Bangladesh," Oxford Economic Papers, Oxford University Press, vol. 42(3), pages 574-85, July.
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Citations

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Cited by:
  1. Bussolo, Maurizio & De Hoyos, Rafael & Medvedev, Denis, 2009. "Global income distribution and poverty in the absence of agricultural distortions," Policy Research Working Paper Series 4849, The World Bank.
  2. Mamoon, Dawood & Murshed, S. Mansoob, 2011. "Labour Markets, Education and Duality of Returns," MPRA Paper 29529, University Library of Munich, Germany.
  3. de Janvry, Alain & Sadoulet, Elisabeth, 2010. "The Global Food Crisis and Guatemala: What Crisis and for Whom?," World Development, Elsevier, vol. 38(9), pages 1328-1339, September.
  4. Han, Jun & Liu, Runjuan & Zhang, Junsen, 2012. "Globalization and wage inequality: Evidence from urban China," Journal of International Economics, Elsevier, vol. 87(2), pages 288-297.
  5. Xiuqing Wang & Shujie Yao & Juan Liu & Xian Xin & Xiumei Liu & Wenjuan Ren, 2007. "Measuring Rural Poverty in China: a Case Study Approach," Working Papers PMMA 2007-27, PEP-PMMA.

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