Socioeconomic Impacts of Cross- Border Transport Infrastructure Development in South Asia
Although the overall economic performance of economies in South Asia in recent years has been impressive, there is concern that an aging and increasingly inadequate infrastructure may limit the potential for further growth and economic development. A critical infrastructure component is the transportation network, and there are currently several transportation infrastructure projects in the South Asia Subregional Economic Cooperation (SASEC) region, connecting Nepal, eastern India, Bangladesh, and Bhutan. This paper uses computable general equilibrium (CGE) methods to address how these infrastructure developments might affect the broader economy in SASEC, and in particular impact on income distribution and poverty. The paper describes a new CGE model for South Asia, covering India, Sri Lanka, Bangladesh, Nepal, and Pakistan, which incorporates modifications to household structure in order to capture the implications of reform for changes in intra-household income. The scenarios that are considered reflect proposed investments in land transport infrastructure in the SASEC region. These should result in reductions in the land transport component of international transport margins, which vary bilaterally by commodity. We found that all SASEC economies would benefit from the reductions in terms of aggregate welfare, with the largest gains accruing to India in absolute terms, but the largest relative gains to Nepal, followed by Bangladesh and Sri Lanka when the margin reduction is prorated to intra-South Asian trade rather than just SASEC. In terms of household level distribution, the picture was mixed, with clearly pro-poor outcomes in some countries, such as Nepal, but more ambiguous impacts in others. In terms of potential adjustment costs, examination of the extent of predicted structural changes suggests that these would be minor, although somewhat more significant for the smaller economies in the region.
|Date of creation:||Jan 2010|
|Date of revision:|
|Contact details of provider:|| Postal: JG Crawford Building #13, Asia Pacific School of Economics and Government, Australian National University, ACT 0200|
Web page: http://www.eaber.org
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Acharya, Sanjaya & Cohen, Solomon, 2008. "Trade liberalisation and household welfare in Nepal," Journal of Policy Modeling, Elsevier, vol. 30(6), pages 1057-1060.
- Ahmed, Vaqar & O' Donoghue, Cathal, 2008. "Welfare impact of external balance in pakistan: CGE-microsimulation analysis," MPRA Paper 9267, University Library of Munich, Germany.
- Sandra Polaski & Manoj Panda & A. Ganesh-Kumar & Scott McDonald & Sherman Robinson, 2008. "Policy Dilemmas in India - The Impact of Changes in Agricultural Prices on Rural and Urban Poverty," Trade Working Papers 22409, East Asian Bureau of Economic Research.
- John Cockburn, 2004.
"Trade Liberalisation and Poverty in Nepal A Computable General Equilibrium Micro Simulation Analysis,"
Development and Comp Systems
- John Cockburn, 2002. "Trade Liberalisation and Poverty in Nepal A Computable General Equilibrium Micro Simulation Analysis," Economics Series Working Papers WPS/2002-11, University of Oxford, Department of Economics.
- John Cockburn, 2002. "Trade Liberalisation and Poverty in Nepal: A Computable General Equilibrium Micro Simulation Analysis," CSAE Working Paper Series 2002-11, Centre for the Study of African Economies, University of Oxford.
- Hertel, Thomas W. & Reimer, Jeffrey J., 2004.
"Predicting the poverty impacts of trade reform,"
Policy Research Working Paper Series
3444, The World Bank.
- 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.
- Thomas Hertel & Jeffrey Reimer, 2005. "Predicting the poverty impacts of trade reform," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 14(4), pages 377-405.
- Robert Scollay & John Gilbert, 2000. "Measuring the Gains from APEC Trade Liberalisation: An Overview of CGE Assessments," The World Economy, Wiley Blackwell, vol. 23(2), pages 175-197, 02.
- Kym Anderson & Will Martin, 2005.
"Agricultural Trade Reform and the Doha Development Agenda,"
Centre for International Economic Studies Working Papers
2005-17, University of Adelaide, Centre for International Economic Studies.
- Kym Anderson & Will Martin, 2005. "Agricultural Trade Reform and the Doha Development Agenda," The World Economy, Wiley Blackwell, vol. 28(9), pages 1301-1327, 09.
- Will Martin & Kym Anderson, 2006. "Agricultural Trade Reform and the Doha Development Agenda," World Bank Publications, The World Bank, number 6889, January.
- Anderson, Kym & Martin, Will, 2005. "Agricultural trade reform and the Doha development agenda," Policy Research Working Paper Series 3607, The World Bank.
- Thomas W. Hertel & L. Alan Winters, 2005. "Estimating the Poverty Impacts of a Prospective Doha Development Agenda," The World Economy, Wiley Blackwell, vol. 28(8), pages 1057-1071, 08.
- Hertel, Thomas & David Hummels & Maros Ivanic & Roman Keeney, 2003.
"How Confident Can We Be in CGE-Based Assessments of Free Trade Agreements?,"
GTAP Working Papers
1324, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University.
- Hertel, Thomas & Hummels, David & Ivanic, Maros & Keeney, Roman, 2007. "How confident can we be of CGE-based assessments of Free Trade Agreements?," Economic Modelling, Elsevier, vol. 24(4), pages 611-635, July.
- Thomas Hertel & David Hummels & Maros Ivanic & Roman Keeney, 2004. "How Confident Can We Be in CGE-Based Assessments of Free Trade Agreements?," NBER Working Papers 10477, National Bureau of Economic Research, Inc.
- Fontana, Marzia & Wobst, Peter, 2001. "A gendered 1993-94 Social Accounting Matrix for Bangladesh," TMD discussion papers 74, International Food Policy Research Institute (IFPRI).
- Manoj Panda & A. Ganesh-Kumar, 2008.
"Trade Liberalization, Poverty and Food Security in India,"
Trade Working Papers
22410, East Asian Bureau of Economic Research.
- Panda, Manoj & Ganesh-Kumar, A., 2009. "Trade liberalization, poverty, and food security in India:," IFPRI discussion papers 930, International Food Policy Research Institute (IFPRI).
- World Bank, 2007. "World Development Indicators 2007," World Bank Publications, The World Bank, number 8150, January.
- Annabi, Nabil & Khondker, Bazlul & Raihan, Selim & Cockburn, John & Decaluwe, Bernard, 2006. "Implications of WTO agreements and unilateral trade policy reforms for poverty in Bangladesh : short versus long-run impacts," Policy Research Working Paper Series 3976, The World Bank.
- repec:ebl:ecbull:v:15:y:2007:i:17:p:1-14 is not listed on IDEAS
- Raihan, Selim, 2008. "Trade Liberalization and Poverty in Bangladesh," MPRA Paper 37905, University Library of Munich, Germany.
- Robinson, Sherman & Thierfelder, Karen, 1999.
"Trade liberalization and regional integration: the search for large numbers,"
TMD discussion papers
34, International Food Policy Research Institute (IFPRI).
- Robinson, Sherman & Thierfelder, Karen, 2002. "Trade liberalisation and regional integration: the search for large numbers," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 46(4), December.
- L. Alan Winters, 2002. "Trade Liberalisation and Poverty: What are the Links?," The World Economy, Wiley Blackwell, vol. 25(9), pages 1339-1367, 09.
- John Gilbert, 2009.
"Agricultural Trade Reform Under Doha and Poverty in India,"
200903, Utah State University, Department of Economics and Finance, revised 28 Jun 2009.
- John Gilbert, 2009. "Agricultural Trade Reform Under Doha and Poverty in India," Working Papers 2009-03, Utah State University, Department of Economics, revised 28 Jun 2009.
- Basanta K. Pradhan & Sahoo Amarendra, 2006. "The Impact of Trade Liberalization on Household Welfare and Poverty in India," Working Papers MPIA 2006-01, PEP-MPIA.
- Sanjaya Acharya, 2007. "Flow Structure in Nepal and the Benefit to the Poor," Economics Bulletin, AccessEcon, vol. 15(17), pages 1-14.
- John Gilbert & Thomas Wahl, 2002. "Applied General Equilibrium Assessments of Trade Libereralisation in China," The World Economy, Wiley Blackwell, vol. 25(5), pages 697-731, 05.
- Peter J. Lloyd & Donald Maclaren, 2004. "Gains and Losses from Regional Trading Agreements: A Survey," The Economic Record, The Economic Society of Australia, vol. 80(251), pages 445-467, December.
- Khan, haider, 2008. "Analyzing Poverty Impact of Trade Liberalization Policies in CGE Models: Theory and Some Policy Experiments in Agricultural and Non-agricultural Sectors in South Asia," MPRA Paper 7609, University Library of Munich, Germany, revised Mar 2008.
When requesting a correction, please mention this item's handle: RePEc:eab:develo:21803. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Shiro Armstrong)
If references are entirely missing, you can add them using this form.