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Export Taxes, World Prices, and Poverty in Argentina: A Dynamic CGEMicrosimulation Analysis
[model, Argentina. Classification-JEL: C68, D58, I38, E62]

Author

Listed:
  • Martín Cicowiez

    (CEDLAS-FCE-Universidad Nacional de La Plata Calle 6 #777, La Plata (1900), Argentina)

  • Javier Alejo

    (CEDLAS-FCE-Universidad Nacional de La Plata and CONICET Calle 6 #777, La Plata (1900), Argentina)

  • Luciano Di Gresia

    (FCE-Universidad Nacional de La Plata Calle 6 #777, La Plata (1900), Argentina)

  • Sergio Olivieri
  • World Bank

    (1818 H Street, NW Washington, DC 20433, USA)

  • Ana Pacheco

    (CEDLAS-FCE-Universidad Nacional de La Plata Calle 6 #777, La Plata (1900), Argentina)

Abstract

In this paper we implement a sequential dynamic computable general equilibrium model combined with a microsimulation model to assess (1) the short- and long-run economic impacts of a gradual reduction in the export tax that was introduced during the economic crisis that hit Argentina at the end of 2001, and (2) the impact of a decrease in the world prices of food products, one of the countrys main export products. Our results show that the elimination of the export tax would have different long run effects depending on the fiscal instrument that is used by the government to compensate for the loss in tax revenue. On the one hand, when the government increased direct tax rate, there is a long-run positive effect on growth. In all cases, the employment level is lower and the price of food items is higher. Therefore, the poverty headcount ratio increases. As expected, a reduction in the world price of food items (i.e., a worsening in Argentinas terms of trade) would impact negatively on the countrys GDP growth rate and poverty, particularly in the rural areas.

Suggested Citation

  • Martín Cicowiez & Javier Alejo & Luciano Di Gresia & Sergio Olivieri & World Bank & Ana Pacheco, 2016. "Export Taxes, World Prices, and Poverty in Argentina: A Dynamic CGEMicrosimulation Analysis [model, Argentina. Classification-JEL: C68, D58, I38, E62]," International Journal of Microsimulation, International Microsimulation Association, vol. 9(1), pages 24-54.
    • Handle: RePEc:ijm:journl:v:9:y:2016:i:1:p:24-54
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    References listed on IDEAS

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    1. Martín Cicowiez & Javier Alejo & Luciano Di Gresia & Sergio Olivieri & World Bank & Ana Pacheco, 2016. "Export Taxes, World Prices, and Poverty in Argentina: A Dynamic CGEMicrosimulation Analysis [model, Argentina. Classification-JEL: C68, D58, I38, E62]," International Journal of Microsimulation, International Microsimulation Association, vol. 9(1), pages 24-54.
    2. Javier Alejo, 2010. "Transición Demográfica y Pobreza en América Latina. Un Análisis de Microsimulaciones," CEDLAS, Working Papers 0108, CEDLAS, Universidad Nacional de La Plata.
    3. Necibi, Thameur, 2014. "The oil position in the Tunisian economy: Adaptation of computable general equilibrium model," MPRA Paper 55185, University Library of Munich, Germany.
    4. Gohin, Alexandre & Levert, Fabrice & Forslund, Agneta, . "The EU Argentinean Trade Dispute on Biodiesel: An Economic Assessment," German Journal of Agricultural Economics, Humboldt-Universitaet zu Berlin, Department for Agricultural Economics, vol. 66(01).
    5. Leonardo Eric CALCAGNO, 2017. "Does the introduction of non-contributory social benefits discourage registered labour? Testing the impact of pension moratoriums on unregistered employment in Argentina (2003-2015)," LEO Working Papers / DR LEO 2526, Orleans Economics Laboratory / Laboratoire d'Economie d'Orleans (LEO), University of Orleans.
    6. Leonardo Eric Calcagno, 2017. "Does the introduction of non-contributory social benefits discourage registered labour? Testing the impact of pension moratoriums on unregistered employment in Argentina (2003-2015)," Working Papers hal-01611132, HAL.

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    Keywords

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    JEL classification:

    • D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • I30 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General
    • O54 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Latin America; Caribbean

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