Rules of Thumb for Evaluating Preferential Trading Arrangements : Evidence from Computable General Equilibrium Assessments
Most interesting results on the welfare effects of regional arrangements are ambiguous at a theoretical level. Many questions only have quantitative answers that are specific to the particular structural features of the economy and the policy consi...
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| Format: | Policy Research Working Paper |
| Language: | English en_US |
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World Bank, Washington, DC
2014
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| Online Access: | http://documents.worldbank.org/curated/en/2003/10/2819736/rules-thumb-evaluating-preferential-trading-arrangements-evidence-computable-general-equilibrium-assessments http://hdl.handle.net/10986/18041 |
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okr-10986-18041 |
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| recordtype |
oai_dc |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
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World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English en_US |
| topic |
ADDITIVE FREE TRADE ADDITIVE FREE TRADE AGREEMENTS ADDITIVE REGIONALISM AGRICULTURAL PRODUCTS AGRICULTURE ANTIDUMPING ANTIDUMPING POLICIES CAPITAL STOCK CENTRAL ELASTICITIES CENTRAL ELASTICITY COMPETITIVE LIBERALIZATION CONSTANT RETURNS TO SCALE CONSUMERS COUNTRY IMPORTS COUNTRY MARKETS CUSTOMS CUSTOMS UNION CUSTOMS UNIONS DEVELOPMENT ECONOMICS DYNAMIC EFFECTS ECONOMIC EFFECTS ECONOMIC IMPLICATIONS ECONOMIC INTEGRATION EQUILIBRIUM EQUILIBRIUM ASSESSMENTS EXCHANGE RATE EXPORTS EXTERNAL TARIFF FACTORS OF PRODUCTION FOREIGN TRADE FREE TRADE FREE TRADE AGREEMENT FREE TRADE AGREEMENTS GDP GLOBAL FREE TRADE HIGH TARIFFS IMPACT OF TRADE IMPERFECT COMPETITION IMPORT DEMAND IMPORT SUBSTITUTION IMPORT SUBSTITUTION INDUSTRIALIZATION INCOME INCREASING RETURNS INCREASING RETURNS TO SCALE INDUSTRIALIZATION INTERNATIONAL ECONOMICS LOSS OF TARIFF REVENUE MARGINAL COST MARKET ACCESS MONETARY COMMUNITY MULTILATERAL TRADE MULTILATERAL TRADE LIBERALIZATION OPEN ECONOMY OPEN TRADE OPEN TRADE REGIMES PARTNER COUNTRIES PARTNER COUNTRY PREFERENTIAL ACCESS PREFERENTIAL TARIFF PREFERENTIAL TARIFF REDUCTION PREFERENTIAL TRADE PREFERENTIAL TRADE ARRANGEMENT PREFERENTIAL TRADING PREFERENTIAL TRADING ARRANGEMENTS PRODUCERS PRODUCTIVITY PROSPECTIVE PARTNER PROSPECTIVE PARTNERS REGIONAL AGREEMENTS REGIONAL ARRANGEMENT REGIONAL ARRANGEMENTS REGIONAL INTEGRATION REGIONAL PARTNERS REGIONAL PREFERENCES SAFETY NETS STATIC EFFECTS TARIFF LEVELS TARIFF STRUCTURE TAX REFORM TAX REVENUE TECHNOLOGY DIFFUSION TECHNOLOGY SPILLOVERS TECHNOLOGY TRANSFER TERMS OF TRADE TERMS OF TRADE EFFECTS TERMS OF TRADE LOSS TRADE AGREEMENT TRADE CREATION TRADE DIVERSION TRADE DIVERSION COSTS TRADE GAINS TRADE INTEGRATION TRADE MODELS TRADE POLICIES TRADE POLICY TRADE POLICY OPTIONS TRADE REFORM TRADE REFORMS TRADE REGIME TRADE TAXES TRADING PARTNERS UNILATERAL TRADE UNILATERAL TRADE LIBERALIZATION UNSKILLED LABOR URUGUAY ROUND VALUE ADDED VALUE-ADDED TAX WELFARE EFFECTS WELFARE GAINS WELFARE LOSS ZERO TARIFFS PREFERENTIAL TRADE AGREEMENTS GENERAL EQUILIBRIUM MODELS MARKET ACCESS NET BENEFITS FREE TRADE AREAS EXTERNAL TRADE TARIFF AGREEMENTS NORTH-SOUTH TRADE COMPETITIVENESS REGIONAL TRADE AGREEMENTS MULTILATERAL TRADE NEGOTIATIONS TRADE LIBERALIZATION TRADE BARRIERS TAX REVENUES HOUSEHOLD INCOME SOCIAL SAFETY NETS HOUSEHOLD WELFARE INDICATORS ZERO TARIFFS computable general equilibrium |
| spellingShingle |
ADDITIVE FREE TRADE ADDITIVE FREE TRADE AGREEMENTS ADDITIVE REGIONALISM AGRICULTURAL PRODUCTS AGRICULTURE ANTIDUMPING ANTIDUMPING POLICIES CAPITAL STOCK CENTRAL ELASTICITIES CENTRAL ELASTICITY COMPETITIVE LIBERALIZATION CONSTANT RETURNS TO SCALE CONSUMERS COUNTRY IMPORTS COUNTRY MARKETS CUSTOMS CUSTOMS UNION CUSTOMS UNIONS DEVELOPMENT ECONOMICS DYNAMIC EFFECTS ECONOMIC EFFECTS ECONOMIC IMPLICATIONS ECONOMIC INTEGRATION EQUILIBRIUM EQUILIBRIUM ASSESSMENTS EXCHANGE RATE EXPORTS EXTERNAL TARIFF FACTORS OF PRODUCTION FOREIGN TRADE FREE TRADE FREE TRADE AGREEMENT FREE TRADE AGREEMENTS GDP GLOBAL FREE TRADE HIGH TARIFFS IMPACT OF TRADE IMPERFECT COMPETITION IMPORT DEMAND IMPORT SUBSTITUTION IMPORT SUBSTITUTION INDUSTRIALIZATION INCOME INCREASING RETURNS INCREASING RETURNS TO SCALE INDUSTRIALIZATION INTERNATIONAL ECONOMICS LOSS OF TARIFF REVENUE MARGINAL COST MARKET ACCESS MONETARY COMMUNITY MULTILATERAL TRADE MULTILATERAL TRADE LIBERALIZATION OPEN ECONOMY OPEN TRADE OPEN TRADE REGIMES PARTNER COUNTRIES PARTNER COUNTRY PREFERENTIAL ACCESS PREFERENTIAL TARIFF PREFERENTIAL TARIFF REDUCTION PREFERENTIAL TRADE PREFERENTIAL TRADE ARRANGEMENT PREFERENTIAL TRADING PREFERENTIAL TRADING ARRANGEMENTS PRODUCERS PRODUCTIVITY PROSPECTIVE PARTNER PROSPECTIVE PARTNERS REGIONAL AGREEMENTS REGIONAL ARRANGEMENT REGIONAL ARRANGEMENTS REGIONAL INTEGRATION REGIONAL PARTNERS REGIONAL PREFERENCES SAFETY NETS STATIC EFFECTS TARIFF LEVELS TARIFF STRUCTURE TAX REFORM TAX REVENUE TECHNOLOGY DIFFUSION TECHNOLOGY SPILLOVERS TECHNOLOGY TRANSFER TERMS OF TRADE TERMS OF TRADE EFFECTS TERMS OF TRADE LOSS TRADE AGREEMENT TRADE CREATION TRADE DIVERSION TRADE DIVERSION COSTS TRADE GAINS TRADE INTEGRATION TRADE MODELS TRADE POLICIES TRADE POLICY TRADE POLICY OPTIONS TRADE REFORM TRADE REFORMS TRADE REGIME TRADE TAXES TRADING PARTNERS UNILATERAL TRADE UNILATERAL TRADE LIBERALIZATION UNSKILLED LABOR URUGUAY ROUND VALUE ADDED VALUE-ADDED TAX WELFARE EFFECTS WELFARE GAINS WELFARE LOSS ZERO TARIFFS PREFERENTIAL TRADE AGREEMENTS GENERAL EQUILIBRIUM MODELS MARKET ACCESS NET BENEFITS FREE TRADE AREAS EXTERNAL TRADE TARIFF AGREEMENTS NORTH-SOUTH TRADE COMPETITIVENESS REGIONAL TRADE AGREEMENTS MULTILATERAL TRADE NEGOTIATIONS TRADE LIBERALIZATION TRADE BARRIERS TAX REVENUES HOUSEHOLD INCOME SOCIAL SAFETY NETS HOUSEHOLD WELFARE INDICATORS ZERO TARIFFS computable general equilibrium Harrison, Glenn W. Rutherford, Thomas F. Tarr, David G. Rules of Thumb for Evaluating Preferential Trading Arrangements : Evidence from Computable General Equilibrium Assessments |
| relation |
Policy Research Working Paper;No. 3149 |
| description |
Most interesting results on the welfare
effects of regional arrangements are ambiguous at a
theoretical level. Many questions only have quantitative
answers that are specific to the particular structural
features of the economy and the policy considered. So, to
determine the impact of prospective regional arrangements
governments often rely on a quantitative evaluation. Usually
at the request of client governments of the World Bank, the
authors have implemented many computable general equilibrium
(CGE) models to inform policymakers. The authors summarize
the main conclusions drawn from these studies. The principal
conclusions are: 1) Countries excluded from a preferential
trade arrangement almost always lose. 2) Market access is a
key determinant of the net benefits of a preferential trade
arrangement. 3) With a free trade agreement (FTA) the
external tariff can be lowered such that a poor FTA becomes
attractive. 4) For Southern countries, North-South
agreements offer a beneficial increase in competition in
their home markets, and involve little increase in the
supply price of Northern country sales in Southern
countries. 5) Multilateral trade liberalization results in
significantly larger gains to the world than the network of
regional arrangements. 6) For individual countries without
high protection, "additive regionalism" will
likely result in substantially larger gains than unilateral
trade liberalization. 7) Tax replacement requirements reduce
the set of desirable regional arrangements. 8) Trade taxes
are often an inefficient source of tax revenue. 9) Trade
liberalization should be expected to be pro-poor in
developing countries, but results will be diverse at the
household level so safety nets are important. 10) Dynamic
effects to reverse conclusions regarding regionalism are not expected. |
| format |
Publications & Research :: Policy Research Working Paper |
| author |
Harrison, Glenn W. Rutherford, Thomas F. Tarr, David G. |
| author_facet |
Harrison, Glenn W. Rutherford, Thomas F. Tarr, David G. |
| author_sort |
Harrison, Glenn W. |
| title |
Rules of Thumb for Evaluating Preferential Trading Arrangements : Evidence from Computable General Equilibrium Assessments |
| title_short |
Rules of Thumb for Evaluating Preferential Trading Arrangements : Evidence from Computable General Equilibrium Assessments |
| title_full |
Rules of Thumb for Evaluating Preferential Trading Arrangements : Evidence from Computable General Equilibrium Assessments |
| title_fullStr |
Rules of Thumb for Evaluating Preferential Trading Arrangements : Evidence from Computable General Equilibrium Assessments |
| title_full_unstemmed |
Rules of Thumb for Evaluating Preferential Trading Arrangements : Evidence from Computable General Equilibrium Assessments |
| title_sort |
rules of thumb for evaluating preferential trading arrangements : evidence from computable general equilibrium assessments |
| publisher |
World Bank, Washington, DC |
| publishDate |
2014 |
| url |
http://documents.worldbank.org/curated/en/2003/10/2819736/rules-thumb-evaluating-preferential-trading-arrangements-evidence-computable-general-equilibrium-assessments http://hdl.handle.net/10986/18041 |
| _version_ |
1764438750114349056 |
| spelling |
okr-10986-180412021-04-23T14:03:41Z Rules of Thumb for Evaluating Preferential Trading Arrangements : Evidence from Computable General Equilibrium Assessments Harrison, Glenn W. Rutherford, Thomas F. Tarr, David G. ADDITIVE FREE TRADE ADDITIVE FREE TRADE AGREEMENTS ADDITIVE REGIONALISM AGRICULTURAL PRODUCTS AGRICULTURE ANTIDUMPING ANTIDUMPING POLICIES CAPITAL STOCK CENTRAL ELASTICITIES CENTRAL ELASTICITY COMPETITIVE LIBERALIZATION CONSTANT RETURNS TO SCALE CONSUMERS COUNTRY IMPORTS COUNTRY MARKETS CUSTOMS CUSTOMS UNION CUSTOMS UNIONS DEVELOPMENT ECONOMICS DYNAMIC EFFECTS ECONOMIC EFFECTS ECONOMIC IMPLICATIONS ECONOMIC INTEGRATION EQUILIBRIUM EQUILIBRIUM ASSESSMENTS EXCHANGE RATE EXPORTS EXTERNAL TARIFF FACTORS OF PRODUCTION FOREIGN TRADE FREE TRADE FREE TRADE AGREEMENT FREE TRADE AGREEMENTS GDP GLOBAL FREE TRADE HIGH TARIFFS IMPACT OF TRADE IMPERFECT COMPETITION IMPORT DEMAND IMPORT SUBSTITUTION IMPORT SUBSTITUTION INDUSTRIALIZATION INCOME INCREASING RETURNS INCREASING RETURNS TO SCALE INDUSTRIALIZATION INTERNATIONAL ECONOMICS LOSS OF TARIFF REVENUE MARGINAL COST MARKET ACCESS MONETARY COMMUNITY MULTILATERAL TRADE MULTILATERAL TRADE LIBERALIZATION OPEN ECONOMY OPEN TRADE OPEN TRADE REGIMES PARTNER COUNTRIES PARTNER COUNTRY PREFERENTIAL ACCESS PREFERENTIAL TARIFF PREFERENTIAL TARIFF REDUCTION PREFERENTIAL TRADE PREFERENTIAL TRADE ARRANGEMENT PREFERENTIAL TRADING PREFERENTIAL TRADING ARRANGEMENTS PRODUCERS PRODUCTIVITY PROSPECTIVE PARTNER PROSPECTIVE PARTNERS REGIONAL AGREEMENTS REGIONAL ARRANGEMENT REGIONAL ARRANGEMENTS REGIONAL INTEGRATION REGIONAL PARTNERS REGIONAL PREFERENCES SAFETY NETS STATIC EFFECTS TARIFF LEVELS TARIFF STRUCTURE TAX REFORM TAX REVENUE TECHNOLOGY DIFFUSION TECHNOLOGY SPILLOVERS TECHNOLOGY TRANSFER TERMS OF TRADE TERMS OF TRADE EFFECTS TERMS OF TRADE LOSS TRADE AGREEMENT TRADE CREATION TRADE DIVERSION TRADE DIVERSION COSTS TRADE GAINS TRADE INTEGRATION TRADE MODELS TRADE POLICIES TRADE POLICY TRADE POLICY OPTIONS TRADE REFORM TRADE REFORMS TRADE REGIME TRADE TAXES TRADING PARTNERS UNILATERAL TRADE UNILATERAL TRADE LIBERALIZATION UNSKILLED LABOR URUGUAY ROUND VALUE ADDED VALUE-ADDED TAX WELFARE EFFECTS WELFARE GAINS WELFARE LOSS ZERO TARIFFS PREFERENTIAL TRADE AGREEMENTS GENERAL EQUILIBRIUM MODELS MARKET ACCESS NET BENEFITS FREE TRADE AREAS EXTERNAL TRADE TARIFF AGREEMENTS NORTH-SOUTH TRADE COMPETITIVENESS REGIONAL TRADE AGREEMENTS MULTILATERAL TRADE NEGOTIATIONS TRADE LIBERALIZATION TRADE BARRIERS TAX REVENUES HOUSEHOLD INCOME SOCIAL SAFETY NETS HOUSEHOLD WELFARE INDICATORS ZERO TARIFFS computable general equilibrium Most interesting results on the welfare effects of regional arrangements are ambiguous at a theoretical level. Many questions only have quantitative answers that are specific to the particular structural features of the economy and the policy considered. So, to determine the impact of prospective regional arrangements governments often rely on a quantitative evaluation. Usually at the request of client governments of the World Bank, the authors have implemented many computable general equilibrium (CGE) models to inform policymakers. The authors summarize the main conclusions drawn from these studies. The principal conclusions are: 1) Countries excluded from a preferential trade arrangement almost always lose. 2) Market access is a key determinant of the net benefits of a preferential trade arrangement. 3) With a free trade agreement (FTA) the external tariff can be lowered such that a poor FTA becomes attractive. 4) For Southern countries, North-South agreements offer a beneficial increase in competition in their home markets, and involve little increase in the supply price of Northern country sales in Southern countries. 5) Multilateral trade liberalization results in significantly larger gains to the world than the network of regional arrangements. 6) For individual countries without high protection, "additive regionalism" will likely result in substantially larger gains than unilateral trade liberalization. 7) Tax replacement requirements reduce the set of desirable regional arrangements. 8) Trade taxes are often an inefficient source of tax revenue. 9) Trade liberalization should be expected to be pro-poor in developing countries, but results will be diverse at the household level so safety nets are important. 10) Dynamic effects to reverse conclusions regarding regionalism are not expected. 2014-04-25T14:42:17Z 2014-04-25T14:42:17Z 2003-10 http://documents.worldbank.org/curated/en/2003/10/2819736/rules-thumb-evaluating-preferential-trading-arrangements-evidence-computable-general-equilibrium-assessments http://hdl.handle.net/10986/18041 English en_US Policy Research Working Paper;No. 3149 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research |