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Trade Reform Diagnostics with Many Households, Quotas, and Tariffs

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  • James E. Anderson

    () (Boston College)

Abstract

The desirability of trade reform paired with revenue neutral changes in other distortionary taxes is an empirical question. With a particular Computable General Equilibrium model of an economy, particular reforms can be evaluated, but the robustness of conclusions is suspect; they depend on a particular specification and parameterization of the model economy. This paper provides a diagnostic toolkit which permits sensitivity analysis across model specifications and parameterizations. Novel elements are an emphasis on the concept of compensated Marginal Cost of Funds (MCF), development of the MCF of quotas and analysis of the relationship between aggregate MCF and social welfare.

Suggested Citation

  • James E. Anderson, 1999. "Trade Reform Diagnostics with Many Households, Quotas, and Tariffs," Boston College Working Papers in Economics 417, Boston College Department of Economics, revised 03 May 2000.
  • Handle: RePEc:boc:bocoec:417
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    References listed on IDEAS

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    Cited by:

    1. Knud Munk, 2008. "Tax-tariff reform with costs of tax administration," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 15(6), pages 647-667, December.
    2. Joseph Francis Francois & Hugo ROJAS-ROMAGOSA, 2008. "Equity and International Trade," Economics working papers 2008-14, Department of Economics, Johannes Kepler University Linz, Austria.
    3. Francois, Joseph & Rojas-Romagosa, Hugo, 2011. "Household inequality, social welfare, and trade," Journal of Development Economics, Elsevier, vol. 96(2), pages 422-431, November.
    4. Emran, M. Shahe & Stiglitz, Joseph E., 2005. "On selective indirect tax reform in developing countries," Journal of Public Economics, Elsevier, vol. 89(4), pages 599-623, April.

    More about this item

    Keywords

    Marginal cost of funds; trade reform;

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation

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