Computable General Equilibrium Micro-Simulation Analysis of the Impact of Trade Policies on Poverty in Zimbabwe

MPIA Working Paper No. 2005-01

37 Pages Posted: 14 May 2007

See all articles by M. Chitiga

M. Chitiga

University of Pretoria - Department of Economics

Tonia Kandiero

Government of the Republic of South Africa - South Africa National Treasury

Ramos Mabugu

University of Zimbabwe

Date Written: June 2005

Abstract

The paper uses a micro-simulation computable general equilibrium (CGE) model to study the impact on poverty of trade liberalisation in Zimbabwe. The model incorporates 14006 households derived from the 1995 Poverty Assessment Study Survey (PASS). The novelty of this paper is that it is one among a small group of papers that incorporates individual households in the CGE model as opposed to having representative households, allowing for a comprehensive analysis of poverty. The complete removal of tariffs favours exportoriented sectors and all imports increase. Poverty falls in the economy while inequality hardly changes. The results differ between rural and urban areas.

Keywords: Computable General Equilibrium, Trade Liberalisation, Microsimulation

JEL Classification: C68, D31, D58, I32

Suggested Citation

Chitiga, Margaret Mabugu and Kandiero, Tonia and Mabugu, Ramos, Computable General Equilibrium Micro-Simulation Analysis of the Impact of Trade Policies on Poverty in Zimbabwe (June 2005). MPIA Working Paper No. 2005-01. Available at SSRN: https://ssrn.com/abstract=985961 or http://dx.doi.org/10.2139/ssrn.985961

Margaret Mabugu Chitiga (Contact Author)

University of Pretoria - Department of Economics ( email )

Lynnwood Road
Hillcrest
Pretoria 0002
South Africa

Tonia Kandiero

Government of the Republic of South Africa - South Africa National Treasury ( email )

Pretoria
South Africa

Ramos Mabugu

University of Zimbabwe

c/o Hall Farm, Wenhaston
Suffolk Ip19 9HE, Mashonaland
United Kingdom

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