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Global income distribution and poverty in the absence of agricultural distortions

  • Bussolo, Maurizio
  • De Hoyos, Rafael
  • Medvedev, Denis

This paper assesses the potential impacts of the removal of agriculture trade distortions using a newly developed dataset and methodological approach for evaluating the global poverty and inequality effects of policy reforms. It finds that liberalization of agriculture and food could increase global extreme poverty (US$1 a day) by 0.2 percent and lower moderate poverty (US$2 a day) by 0.3 percent. Beneath these small aggregate changes, most countries witness a substantial reduction in poverty while South Asia-where half of the world's poor reside-experiences an increase in extreme poverty incidence due to high rates of protection afforded to unskilled-intensive agricultural sectors. The distributional changes are likely to be mild, but exhibit a strong regional pattern. Inequality is likely to fall in regions such as Latin America, which are characterized by high initial inequality, and rise in regions like South Asia, characterized by low initial inequality.

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Paper provided by The World Bank in its series Policy Research Working Paper Series with number 4849.

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Date of creation: 01 Mar 2009
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Handle: RePEc:wbk:wbrwps:4849
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  1. 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.
  2. Bussolo, Maurizio & Lay, Jann & van der Mensbrugghe, Dominique, 2006. "Structural change and poverty reduction in Brazil : the impact of the Doha Round," Policy Research Working Paper Series 3833, The World Bank.
  3. Francisco H. G. Ferreira & Phillippe G. Leite, 2003. "Meeting the Millennium Development Goals in Brazil: Can Microeconomic Simulations Help?," ECONOMIA JOURNAL OF THE LATIN AMERICAN AND CARIBBEAN ECONOMIC ASSOCIATION, ECONOMIA JOURNAL OF THE LATIN AMERICAN AND CARIBBEAN ECONOMIC ASSOCIATION.
  4. Bussolo, Maurizio & De Hoyos, Rafael E. & Medvedev, Denis & van der Mensbrugghe, Dominique, 2007. "Global growth and distribution : are China and India reshaping the world?," Policy Research Working Paper Series 4392, The World Bank.
  5. Chen, Shaohua & Ravallion, Martin, 2003. "Household welfare impacts of China's accession to the World Trade Organization," Policy Research Working Paper Series 3040, The World Bank.
  6. repec:cup:cbooks:9780521029018 is not listed on IDEAS
  7. Ravallion, Martin & Chen, Shaohua, 2003. "Measuring pro-poor growth," Economics Letters, Elsevier, vol. 78(1), pages 93-99, January.
  8. Nicita, Alessandro, 2004. "Who benefited from trade liberalization in Mexico? Measuring the effects on household welfare," Policy Research Working Paper Series 3265, The World Bank.
  9. Anderson, Kym, 2003. "Trade Liberalization, Agriculture, and Poverty in Low-income Countries," Working Paper Series UNU-WIDER Research Paper , World Institute for Development Economic Research (UNU-WIDER).
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