IDEAS home Printed from https://ideas.repec.org/a/bla/rdevec/v12y2008i1p37-56.html
   My bibliography  Save this article

Shocks, Policy Reforms and Pro-Poor Growth in Bolivia: A Simulation Analysis

Author

Listed:
  • Jann Lay
  • Rainer Thiele
  • Manfred Wiebelt

Abstract

This paper analyzes how major external shocks and policy reforms affect Bolivia's ability to achieve pro-poor growth. Employing a recursive-dynamic CGE model, it considers three different scenarios: an optimistic baseline scenario; a more realistic scenario that accounts for two important negative external shocks (declining capital inflows and El Niño); and a scenario that captures the combined effect of the shocks and two major reform projects (development of the gas sector and deregulation of the urban labor market). It turns out that the shocks are likely to impair Bolivia's medium-term development prospects, leading to marked increases in both urban and rural poverty. If the reform projects were implemented, the poverty increase caused by the shocks would be more than offset for urban households, but reinforced for rural households. Copyright © 2007 The Authors; Journal compilation © 2007 Blackwell Publishing Ltd.

Suggested Citation

  • Jann Lay & Rainer Thiele & Manfred Wiebelt, 2008. "Shocks, Policy Reforms and Pro-Poor Growth in Bolivia: A Simulation Analysis," Review of Development Economics, Wiley Blackwell, vol. 12(1), pages 37-56, February.
  • Handle: RePEc:bla:rdevec:v:12:y:2008:i:1:p:37-56
    as

    Download full text from publisher

    File URL: http://www.blackwell-synergy.com/doi/abs/10.1111/j.1467-9361.2007.00394.x
    File Function: link to full text
    Download Restriction: Access to full text is restricted to subscribers.

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Walter H. Fisher, 2004. "Status Preference, Wealth and Dynamics in the Open Economy," German Economic Review, Verein für Socialpolitik, vol. 5(3), pages 335-355, August.
    2. Fisher, Walter H., 1995. "An optimizing analysis of the effects of world interest disturbances on the open economy term structure of interest rates," Journal of International Money and Finance, Elsevier, vol. 14(1), pages 105-126, February.
    3. Stephen J. Turnovsky, 1997. "International Macroeconomic Dynamics," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262201119, January.
    4. Frank, Robert H, 1985. "The Demand for Unobservable and Other Nonpositional Goods," American Economic Review, American Economic Association, pages 101-116.
    5. Oswald, Andrew J, 1997. "Happiness and Economic Performance," Economic Journal, Royal Economic Society, vol. 107(445), pages 1815-1831, November.
    6. Bill Dupor & Wen-Fang Liu, 2003. "Jealousy and Equilibrium Overconsumption," American Economic Review, American Economic Association, pages 423-428.
    7. Clotfelter, Charles T. & Ehrenberg, Ronald G. & Getz, Malcolm & Siegfried, John J., 1992. "Economic Challenges in Higher Education," National Bureau of Economic Research Books, University of Chicago Press, edition 1, number 9780226110509.
      • Robert J. Barro & Paul M. Romer, 1991. "Economic Growth," NBER Books, National Bureau of Economic Research, Inc, number barr91-1.
    8. Bhandari, Jagdeep S. & Ul Haque, Nadeem & Turnovsky, Stephen J., 1989. "Growth, debt, and sovereign risk in a small, open economy," Policy Research Working Paper Series 260, The World Bank.
    9. Futagami, Koichi & Shibata, Akihisa, 1998. "Keeping one step ahead of the Joneses: Status, the distribution of wealth, and long run growth," Journal of Economic Behavior & Organization, Elsevier, vol. 36(1), pages 109-126, July.
    10. Frank, Robert H, 1997. "The Frame of Reference as a Public Good," Economic Journal, Royal Economic Society, vol. 107(445), pages 1832-1847, November.
    11. Fisher, Walter H & Terrell, Dek, 2000. "World Interest Shocks, Capital, and the Current Account," Review of International Economics, Wiley Blackwell, pages 261-274.
    12. Cole, Harold L & Mailath, George J & Postlewaite, Andrew, 1992. "Social Norms, Savings Behavior, and Growth," Journal of Political Economy, University of Chicago Press, vol. 100(6), pages 1092-1125, December.
    13. Robert J. Barro & Paul Romer, 1993. "Economic Growth," NBER Books, National Bureau of Economic Research, Inc, number barr93-1.
    14. Fisher, Walter H. & Hof, Franz X., 2000. "Relative Consumption and Endogenous Labour Supply in the Ramsey Model: Do Status-Conscious People Work Too Much?," Economics Series 85, Institute for Advanced Studies.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Peter Nunnenkamp & Rainer Schweickert & Manfred Wiebelt, 2007. "Distributional Effects of FDI: How the Interaction of FDI and Economic Policy Affects Poor Households in Bolivia," Development Policy Review, Overseas Development Institute, vol. 25(4), pages 429-450, July.
    2. repec:zbw:ifwkie:4251 is not listed on IDEAS
    3. Aliaga Lordemann, Jevier & Villegas Quino, Horacio, 2011. "Poverty, Indigence and Public Investment in Bolivia: A Simulation Analysis," Documentos de trabajo 5/2011, Instituto de Investigaciones Socio-Económicas (IISEC), Universidad Católica Boliviana.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:rdevec:v:12:y:2008:i:1:p:37-56. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wiley-Blackwell Digital Licensing) or (Christopher F. Baum). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=1363-6669 .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.