Distributive Effects of Regional Trade Agreements on the "Small Trading Partners": Mercosur and the case of Uruguay and Paraguay
AbstractAlthough trade integration has potential benefits for developing countries, it is disputed whether trade liberalization processes are, per se, sufficient for poverty reduction and inequality abatement. Abundant work has analyzed the link between tariff reduction, poverty levels and inequality in both developed and developing countries. Gains from trade are generally observed. Still, those benefits from integration are generally unevenly distributed.In our analysis we explore how gains from trade have been distributed in the two minor trade partners of MERCOSUR: Uruguay and Paraguay. We study the link between trade, poverty and inequality by analyzing the impact of trade liberalization through two main transmission channels: prices and income. Our papers show that in the case of Mercosur, the effect of trade on poverty (and income inequality) varies per country and per region. In particular, we conclude that trade integration policies cannot be regarded as a poverty-alleviating policy, per se. --
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Bibliographic InfoPaper provided by Verein für Socialpolitik, Research Committee Development Economics in its series Proceedings of the German Development Economics Conference, Berlin 2011 with number 14.
Date of creation: 2011
Date of revision:
regional trade agreements; poverty; inequality;
Other versions of this item:
- Fernando Borraz & M�ximo Rossi & Daniel Ferres, 2012. "Distributive Effects of Regional Trade Agreements on the ‘Small Trading Partners’: Mercosur and the Case of Uruguay and Paraguay," Journal of Development Studies, Taylor & Francis Journals, vol. 48(12), pages 1828-1843, December.
- F14 - International Economics - - Trade - - - Empirical Studies of Trade
- F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
- D30 - Microeconomics - - Distribution - - - General
- Q17 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agriculture in International Trade
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-07-27 (All new papers)
- NEP-INT-2011-07-27 (International Trade)
- NEP-LAM-2011-07-27 (Central & South America)
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