Economic and Welfare Impacts of Prospective India – Australia FTA Using GTAP and Smart Models
International Journal of Business and Emerging Markets, Vol. 3, No. 4, pp. 396-417, 2011
Posted: 25 Jan 2012
Date Written: December 1, 2011
This study investigates the potential economic impacts of prospective India – Australia Free Trade Agreement (FTA) using a Computable General Equilibrium (CGE) model. Four hypothetical tariff liberalization scenarios are examined in this study focusing on short and long run. The study reveals that both India and Australia gain in terms of welfare. Allocative efficiency for Australia and India broadly improves, suggesting that net trade creation occurs. The study recommends partial and selected tariff liberalization as the best strategy in India's interest while negotiating prospective India – Australia FTA.
Keywords: computable general equilibrium, CGE models, economic integration, emerging markets, GTAP, global trade analysis project; SMART, India Australia FTA, free trade agreements, tariff liberalisation
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