Assessing the Impacts of Trade on Poverty and Inequality

Abstract

This paper uses a computable general equilibrium model to simulate different trade liberalization policy scenarios and counterfactual microsimulations to assess the impacts of greater trade openness on household income distribution and poverty ratios. Our conclusion is that trade liberalization alone may not be sufficient to significantly reduce poverty and inequality.

Keywords: poverty, employment, income inequality, trade iberalization, CGE, counterfactual microsimulations

JEL Classification: F16, C68