IDEAS home Printed from https://ideas.repec.org/p/ags/wbadwp/52795.html
   My bibliography  Save this paper

Would Trade Liberalization Help the Poor of Brazil?

Author

Listed:
  • Ferreira Filho
  • Horridge, Mark
  • Joaquim Bento de Souza

Abstract

This paper addresses the potential effects of world agricultural trade liberalization on poverty and regional income distribution in Brazil, using an inter-regional applied general equilibrium (AGE) and a micro-simulation model of Brazil tailored for income distribution and poverty analysis by using a detailed representation of households. The model distinguishes 10 different labor types and has 270 different household expenditure patterns. Income can originate from 41 different production activities located in 27 different regions in the country. The AGE model communicates to a micro-simulation model that has around 112,000 Brazilian households and 264,000 adults. Poverty and income distribution indices are computed over the entire sample of households and persons, before and after the policy shocks. The simulated trade liberalization scenario causes agriculture to expand considerably and so, given the importance that agriculture still has for the poorest in Brazil, it has positive impacts on poverty in Brazil. The only states which show an increase in the number of poor households are Sao Paulo and Rio de Janeiro, where the bulk of the manufacturing activities in Brazil are concentrated. There is an even more positive impact on inequality. The higher fall in the poverty gap is shown to occur mainly on the poorest household groups, suggesting that the poorest among Brazil’s poor would benefit more from global trade liberalization.

Suggested Citation

  • Ferreira Filho & Horridge, Mark & Joaquim Bento de Souza, 2009. "Would Trade Liberalization Help the Poor of Brazil?," Agricultural Distortions Working Paper Series 52795, World Bank.
    • Handle: RePEc:ags:wbadwp:52795
    DOI: 10.22004/ag.econ.52795
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/52795/files/World%20Trade%20Liberalization%20Help%20for%20the%20Poor%20of%20Brazil-Agricultural%20Distortions%20Working%20Paper%20106_%20June%202009.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.52795?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. W. Jill Harrison & J. Mark Horridge & K.R. Pearson, 2000. "Decomposing Simulation Results with Respect to Exogenous Shocks," Computational Economics, Springer;Society for Computational Economics, vol. 15(3), pages 227-249, June.
    2. Graziano da Silva, Jose & Eduardo Del Grossi, Mauro, 2001. "Rural Nonfarm Employment and Incomes in Brazil: Patterns and Evolution," World Development, Elsevier, vol. 29(3), pages 443-453, March.
    3. Green, Francis & Dickerson, Andy & Saba Arbache, Jorge, 2001. "A Picture of Wage Inequality and the Allocation of Labor Through a Period of Trade Liberalization: The Case of Brazil," World Development, Elsevier, vol. 29(11), pages 1923-1939, November.
    4. Ferreira FIlho, Joaquim Bento de Souza & Horridge, Mark, 2005. "The Doha Round, Poverty and Regional Inequality in Brazil," Conference papers 331332, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    5. Luc Savard, 2003. "Poverty and Income Distribution in a CGE-Household Micro-Simulation Model: Top-Down/Bottom Up Approach," Cahiers de recherche 0343, CIRPEE.
    6. François Bourguignon & Anne-Sophie Robilliard & Sherman Robinson, 2003. "Representative versus real households in the macro-economic modeling of inequality," Working Papers DT/2003/10, DIAL (Développement, Institutions et Mondialisation).
    7. Harrison, Glenn W. & Rutherford, Thomas F. & Tarr, David G. & Gurgel, Angelo, 2002. "Regional, Multilateral and Unilateral Trade Policies of MERCOSUR for Growth and Poverty Reduction in Brazil," Conference papers 331003, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    8. Joaquim Bento de Souza Ferreira Filho & Carliton Vieira dos Santos & Sandra Maria do Prado Lima, 2007. "Tax Reform, Income Distribution and Poverty in Brazil: an Applied General Equilibrium Analysis," Working Papers MPIA 2007-26, PEP-MPIA.
    9. Kym Anderson & Will Martin, 2009. "Distortions to Agricultural Incentives in Asia," World Bank Publications - Books, The World Bank Group, number 2611, December.
    10. Valenzuela, Ernesto & Wong, Sara & Sandri, Damiano, 2007. "Distortions to Agricultural Incentives in Ecuador," Agricultural Distortions Working Paper Series 48394, World Bank.
    11. Horridge, Mark & Madden, John & Wittwer, Glyn, 2005. "The impact of the 2002-2003 drought on Australia," Journal of Policy Modeling, Elsevier, vol. 27(3), pages 285-308, April.
    12. Valenzuela, Ernesto & Kym Anderson, 2009. "Alternative Agricultural Price Distortions for CGE Analysis of Developing Countries, 2004 and 1980-84," GTAP Research Memoranda 2925, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University.
    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. Alan Matthews, 2014. "An updated look at the impact of the EU's Common Agricultural Policy on developing countries," The Institute for International Integration Studies Discussion Paper Series iiisdp454, IIIS.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Maria Cipollina & Luca Salvatici, 2010. "Reciprocal Trade Agreements in Gravity Models: A Meta‐Analysis," Review of International Economics, Wiley Blackwell, vol. 18(1), pages 63-80, February.
    2. Hertel, Thomas W. & Keeney, Roman, 2009. "The Poverty Impacts of Global Commodity Trade Liberalization," Agricultural Distortions Working Paper Series 52786, World Bank.
    3. Kym Anderson & James Giesecke & Ernesto Valenzuela, 2010. "How would global trade liberalization affect rural and regional incomes in Australia?," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 54(4), pages 389-406, October.
    4. Anderson, Kym & Valenzuela, Ernesto & van der Mensbrugghe, Dominique, 2009. "Welfare and Poverty Effects of Global Agricultural and Trade Policies Using the Linkage Model," Agricultural Distortions Working Paper Series 52785, World Bank.
    5. Arndt, Channing & Thurlow, James, 2009. "Inequality and Poverty Impacts of Trade Distortions in Mozambique," Agricultural Distortions Working Paper Series 52794, World Bank.
    6. Herault, Nicolas & Thurlow, James, 2009. "Agricultural Distortions, Poverty and Inequality in South Africa," Agricultural Distortions Working Paper Series 52792, World Bank.
    7. Cicowiez, Martin & Diaz-Bonilla, Carolina & Diaz-Bonilla, Eugenio, 2009. "Impacts of Trade Liberalization on Poverty and Inequality in Argentina," Agricultural Distortions Working Paper Series 52793, World Bank.
    8. Conforti, Piero, 2005. "The Effect of Direct Payments of the OECD Countries in World Agricultural Markets. Evidence From Partial and General Equilibrium Frameworks," Conference papers 331383, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    9. Thomas W. Hertel & Jeffrey J. Reimer, 2006. "Predicting the Poverty Impacts of Trade Reform," QA - Rivista dell'Associazione Rossi-Doria, Associazione Rossi Doria, issue 2, May.
    10. Anderson, Kym & Strutt, Anna, 2012. "Asia?s Growth, the Changing Geography of World Trade, and Food Security: Projections to 2030," CEPR Discussion Papers 8950, C.E.P.R. Discussion Papers.
    11. Kym Anderson, 2009. "Krueger/Schiff/Valdes Revisited: Agricultural Price and Trade Policy Reform in Developing Countries since the 1980s," School of Economics and Public Policy Working Papers 2009-22, University of Adelaide, School of Economics and Public Policy.
    12. Zhai, Fan & Hertel, Thomas W., 2009. "Economic and Poverty Impacts of Agricultural, Trade and Factor Market Reforms in China," Agricultural Distortions Working Paper Series 52787, World Bank.
    13. van der Mensbrugghe, Dominique & Valenzuela, Ernesto & Anderson, Kym, 2009. "Border Price and Export Demand Shocks for Developing Countries from Rest-of-World Trade Liberalization Using the Linkage Model," Agricultural Distortions Working Paper Series 52797, World Bank.
    14. Moreira, Guilherme R.C. & Almeida, Leandro & Guilhoto, Joaquim M. & Azzoni, Carlos R., 2008. "Productive structure and income distribution: The Brazilian case," The Quarterly Review of Economics and Finance, Elsevier, vol. 48(2), pages 320-332, May.
    15. van Ruijven, Bas J. & O’Neill, Brian C. & Chateau, Jean, 2015. "Methods for including income distribution in global CGE models for long-term climate change research," Energy Economics, Elsevier, vol. 51(C), pages 530-543.
    16. Anderson, Kym, 2009. "Political Economy of Distortions to Agricultural Incentives: Introduction and Summary," Agricultural Distortions Working Paper Series 50306, World Bank.
    17. Warr, Peter G., 2009. "Agricultural Protection and Poverty in Indonesia: A General Equilibrium Analysis," Agricultural Distortions Working Paper Series 52788, World Bank.
    18. Warr, Peter G., 2009. "Agricultural Trade Reform and Poverty in Thailand: A General Equilibrium Analysis," Agricultural Distortions Working Paper Series 52791, World Bank.
    19. Kym Anderson, 2011. "Scope for world trade reform to ease Asian poverty and inequality," STUDIES IN TRADE AND INVESTMENT, in: Trade-led growth: A sound strategy for Asia, chapter 11, United Nations Economic and Social Commission for Asia and the Pacific (ESCAP).
    20. Arief Anshory Yusuf, 2008. "INDONESIA-E3: An Indonesian Applied General Equilibrium Model for Analyzing the Economy, Equity, and the Environment," Working Papers in Economics and Development Studies (WoPEDS) 200804, Department of Economics, Padjadjaran University, revised Sep 2008.

    More about this item

    Keywords

    Agricultural and Food Policy; International Relations/Trade;

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:ags:wbadwp:52795. See general information about how to correct material in RePEc.

    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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/wlrdbus.html .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.