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Poverty Effects of the Philippines' Tariff Reduction Program: Insights from a Computable General Equilibrium Analysis

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  • John Cockburn
  • Erwin L. Corong
  • Caesar B. Cororaton

Abstract

A computable general equilibrium micro-simulation model is used to assess the economic and poverty impacts of tariff reduction in the Philippines. Tariff reduction induces consumers to substitute cheaper imported agricultural products for domestic goods, thereby resulting in a contraction in agricultural output. In contrast, tariff reduction reduces the domestic cost of production, benefiting the outward-oriented and import-dependent industrial sector. The national poverty headcount decreases marginally as lower consumer prices outweigh the nominal income reduction experienced by the majority of households. However, both the poverty gap and severity of poverty worsens, implying that the poorest of the poor become even poorer. Copyright 2008 The Authors. Journal compilation 2008 East Asian Economic Association and Blackwell Publishing Ltd.

Suggested Citation

  • John Cockburn & Erwin L. Corong & Caesar B. Cororaton, 2008. "Poverty Effects of the Philippines' Tariff Reduction Program: Insights from a Computable General Equilibrium Analysis ," Asian Economic Journal, East Asian Economic Association, vol. 22(3), pages 289-319, September.
  • Handle: RePEc:bla:asiaec:v:22:y:2008:i:3:p:289-319
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    Cited by:

    1. repec:taf:rjapxx:v:21:y:2016:i:4:p:549-570 is not listed on IDEAS
    2. George Verikios & Xiao-guang Zhang, 2016. "Structural change and income distribution: the case of Australian telecommunications," Journal of the Asia Pacific Economy, Taylor & Francis Journals, vol. 21(4), pages 549-570, October.
    3. Verikios, George & Zhang, Xiao-guang, 2015. "Reform of Australian urban transport: A CGE-microsimulation analysis of the effects on income distribution," Economic Modelling, Elsevier, vol. 44(C), pages 7-17.
    4. Verikios, George & Zhang, Xiao-guang, 2013. "Structural change in the Australian electricity industry during the 1990s and the effect on household income distribution: A macro–micro approach," Economic Modelling, Elsevier, vol. 32(C), pages 564-575.
    5. repec:ijm:journl:v10:y:2017:i:3:p:27-58 is not listed on IDEAS

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