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Foreign Competition and Income Distribution in Canada: A Dynamic Microsimulation CGE Model Analysis

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  • Nabil Annabi
  • Maxime Fougere
  • Min Li

Abstract

In this study we assess the impact of increased foreign competition on labour markets and income distribution in Canada, using a newly developed dynamic microsimulation computable general equilibrium (CGE) model. The main findings of the simulations conducted are that the decline in world prices of imports and exports of the manufacturing products during the 2000s induces small increases in low-income rates and inequality in the short run as well as contractions in the export-oriented manufacturing sectors. In the long run, however, it enhances capital accumulation, particularly in the primary and service sectors, increases real GDP and reduces low-income rates, especially among families with two persons or more.

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  • Nabil Annabi & Maxime Fougere & Min Li, 2013. "Foreign Competition and Income Distribution in Canada: A Dynamic Microsimulation CGE Model Analysis," International Economic Journal, Taylor & Francis Journals, vol. 27(4), pages 525-547, December.
    • Handle: RePEc:taf:intecj:v:27:y:2013:i:4:p:525-547
    DOI: 10.1080/10168737.2012.682077
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    6. Nabil Annabi & H. Khondker Bazlul & Selim Raihan & John Cockburn & Bernard Decaluwe, 2005. "Implications of WTO Agreements and Domestic Trade Policy Reforms for Poverty in Bangladesh: Short vs. Long Run," Working Papers MPIA 2005-02, PEP-MPIA.
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    9. Bernard Decaluwé & John Cockburn & Fatou Cissé & Nabil Annabi, 2008. "Libéralisation commerciale, croissance et pauvreté au Sénégal : une analyse à l’aide d’un MEGC microsimulé dynamique," Économie et Prévision, Programme National Persée, vol. 186(5), pages 117-131.
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    Cited by:

    1. Nabil Annabi & Youssef Boudribila & Simon Harvey, 2013. "Labour supply and income distribution effects of the working income tax benefit: a general equilibrium microsimulation analysis," IZA Journal of Labor Policy, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 2(1), pages 1-33, December.
    2. Andrew Feltenstein & Luciana Lopes & Janet Porras Mendoza & Sally Wallace, 2013. "“The Impact of Micro-simulation and CGE modeling on Tax Reform and Tax Advice in Developing Countries”: A Survey of Alternative Approaches and an Application to Pakistan," International Center for Public Policy Working Paper Series, at AYSPS, GSU paper1309, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.
    3. Alexander Murray, 2017. "The Effect of Import Competition on Employment in Canada: Evidence from the 'China Shock'," CSLS Research Reports 2017-03, Centre for the Study of Living Standards.
    4. Melnikov, Nikolai B. & O’Neill, Brian C. & Dalton, Michael G. & van Ruijven, Bas J., 2017. "Downscaling heterogeneous household outcomes in dynamic CGE models for energy-economic analysis," Energy Economics, Elsevier, vol. 65(C), pages 87-97.
    5. Andrew Feltenstein & Luciana Lopes & Janet Porras-Mendoza & Sally Wallace, 2014. "Modeling tax reform in developing countries," Chapters, in: Richard M. Bird & Jorge Martinez-Vazquez (ed.), Taxation and Development: The Weakest Link?, chapter 3, pages 69-102, Edward Elgar Publishing.

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