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Economic Impact of Potential Outcome of the DDA

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  • Decreux, Yvan
  • Fontagné, Lionel

Abstract

Using a dynamic computable general equilibrium model of the world economy (MIRAGE), we simulate the impacts of the most recent drafts circulated in the multilateral trade negotiations arena, augmented by a modest outcome of the negotiation in services. The liberalisation of tariffs is implemented at the product level in order to take into account exceptions, flexibilities as well as the non-linear design of the formulas. A reduction in domestic support and the phasing out of export subsidies are taken into account. We integrate dynamic gains up to 2025. We observe a $US70bn world Gross Domestic Product (GDP) long run gain when agriculture and industry are liberalised, a $US85bn gain when a 3% reduction in protection for services is added to certain services sectors. Calculation of the gains associated with trade facilitation suggests roughly a doubling of the expected gains ($US152bn); port efficiency adds another $US35bn. Recent proposals for sectoral initiatives would add a further $US15bn on top of these gains.

Suggested Citation

  • Decreux, Yvan & Fontagné, Lionel, 2011. "Economic Impact of Potential Outcome of the DDA," Conference papers 332090, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    • Handle: RePEc:ags:pugtwp:332090
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    References listed on IDEAS

    as
    1. Bouet, Antoine & Laborde, David, 2008. "The potential cost of a failed Doha Round," Issue briefs 56, International Food Policy Research Institute (IFPRI).
    2. Jean-Marc Burniaux & Jean Château, 2011. "Mitigation Potential of Removing Fossil Fuel Subsidies: A General Equilibrium Assessment," OECD Economics Department Working Papers 853, OECD Publishing.
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    More about this item

    Keywords

    International Development; International Relations/Trade;

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F17 - International Economics - - Trade - - - Trade Forecasting and Simulation

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