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Dealing With Diversity: Analyzing The Consequences of Textile Quota Abolition

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  • Martin, Will
  • Manole, Vlad
  • van der Mensbrugghe, Dominique

Abstract

In this paper, we provide a preliminary analysis of the consequences for Pakistan of abolishing the system of quotas installed under the Multi-Fibre Arrangement (MFA) and currently being dismantled under the Agreement on Textiles and Clothing (ATC). We develop a framework that takes into account the major sources of gains and losses from quota abolition. As a basis for the analysis, we developed estimates of the export tax equivalents(ETEs) of quotas that drawn on new data on quota prices for exports from Bangladesh; China; Hong Kong, China; Pakistan; India; Indonesia and Taiwan, China in the US and EU markets. Combining this information with detailed data on the unit values of imports at the quota category level we estimate the export taxes that would have the same restrictive effect as the quotas. Next, we evaluated the broad consequences of quota abolition in a global general equilibrium context, taking into account the second-round impacts associated with expanding exports to the currently restricted markets, the efficiency and employment gains.

Suggested Citation

  • Martin, Will & Manole, Vlad & van der Mensbrugghe, Dominique, 2004. "Dealing With Diversity: Analyzing The Consequences of Textile Quota Abolition," Conference papers 331290, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    • Handle: RePEc:ags:pugtwp:331290
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    References listed on IDEAS

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    1. Luc Savard, 2003. "Poverty and Income Distribution in a CGE-Household Micro-Simulation Model: Top-Down/Bottom Up Approach," Cahiers de recherche 0343, CIRPEE.
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