Aid for trade policy in developing and least developed countries: A GTAP simulation analysis

Zhang, J

Risultato della ricerca: Paper

Abstract

Recent global initiatives on debt relief and development assistance call for increasing aid for trade to the poorest countries. We apply a multi-country computable general equilibrium model, to analyze if aid for trade offers the possibility that, instead of the developing and least developed countries’ being worse off—as so many were as the result of the last round of trade negotiations—they will actually be better off. Alternative aid for trade scenarios have been evaluated in terms of effectiveness and equity. Our findings show that aid for trade policies expand trade and alleviate inequalities. The developing and least developed countries will benefit mainly from aid for trade assistance that helps these countries with any transitional adjustment costs from liberalization and increases factor productivity. Effectiveness of aid for trade is enforced if income transfers from donors are fairly divided amongst the recipient countries.
Lingua originaleEnglish
Stato di pubblicazionePublished - 2011

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Simulation analysis
Developed countries
Trade policy
Development assistance
Factors
Debt relief
Computable general equilibrium model
Income transfers
Adjustment costs
Liberalization
Trade negotiations
Equity
Scenarios
Productivity

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AU - Zhang, J

AU - Berrittella, Maria

PY - 2011

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AB - Recent global initiatives on debt relief and development assistance call for increasing aid for trade to the poorest countries. We apply a multi-country computable general equilibrium model, to analyze if aid for trade offers the possibility that, instead of the developing and least developed countries’ being worse off—as so many were as the result of the last round of trade negotiations—they will actually be better off. Alternative aid for trade scenarios have been evaluated in terms of effectiveness and equity. Our findings show that aid for trade policies expand trade and alleviate inequalities. The developing and least developed countries will benefit mainly from aid for trade assistance that helps these countries with any transitional adjustment costs from liberalization and increases factor productivity. Effectiveness of aid for trade is enforced if income transfers from donors are fairly divided amongst the recipient countries.

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UR - http://hdl.handle.net/10447/59250

UR - https://www.gtap.agecon.purdue.edu/resources/res_display.asp?RecordID=3534

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