Common Transport Infrastructure : A Quantitative Model and Estimates from the Belt and Road Initiative
This paper presents a structural general equilibrium model to analyze the effects on trade, welfare, and gross domestic product of common transport infrastructure. Specifically, the model builds on the framework by Caliendo and Parro (2015) -- a Ri...
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okr-10986-314962022-09-20T00:13:27Z Common Transport Infrastructure : A Quantitative Model and Estimates from the Belt and Road Initiative De Soyres, Francois Mulabdic, Alen Ruta, Michele TRANSPORT INFRASTRUCTURE TRADE BELT AND ROAD INITIATIVE GENERAL EQUILIBRIUM MODEL TRADE POLICY WELFARE IMPACT This paper presents a structural general equilibrium model to analyze the effects on trade, welfare, and gross domestic product of common transport infrastructure. Specifically, the model builds on the framework by Caliendo and Parro (2015) -- a Ricardian model with sectoral linkages, trade in intermediate goods and sectoral heterogeneity -- to allow for changes in trade costs due to improvements in transportation infrastructure, financed through domestic taxation, connecting multiple countries. The model highlights the trade impact of infrastructure investments through cross-border input-output linkages. This framework is then used to quantify the impact of the Belt and Road Initiative. Using new estimates on the effects on trade costs of transport infrastructure related to the initiative based on Geographic Information System analysis, the model shows that gross domestic product will increase by up to 3.4 percent for participating countries and by up to 2.9 percent for the world. Because trade gains are not commensurate with projected investments, some countries may experience a negative welfare effect due to the high cost of the infrastructure. The analysis also finds strong complementarity between infrastructure investment and trade policy reforms. 2019-04-03T20:32:31Z 2019-04-03T20:32:31Z 2019-04 Working Paper http://documents.worldbank.org/curated/en/879031554144957551/Common-Transport-Infrastructure-A-Quantitative-Model-and-Estimates-from-the-Belt-and-Road-Initiative http://hdl.handle.net/10986/31496 English Policy Research Working Paper;No. 8801 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank World Bank, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper |
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 |
topic |
TRANSPORT INFRASTRUCTURE TRADE BELT AND ROAD INITIATIVE GENERAL EQUILIBRIUM MODEL TRADE POLICY WELFARE IMPACT |
spellingShingle |
TRANSPORT INFRASTRUCTURE TRADE BELT AND ROAD INITIATIVE GENERAL EQUILIBRIUM MODEL TRADE POLICY WELFARE IMPACT De Soyres, Francois Mulabdic, Alen Ruta, Michele Common Transport Infrastructure : A Quantitative Model and Estimates from the Belt and Road Initiative |
relation |
Policy Research Working Paper;No. 8801 |
description |
This paper presents a structural general
equilibrium model to analyze the effects on trade, welfare,
and gross domestic product of common transport
infrastructure. Specifically, the model builds on the
framework by Caliendo and Parro (2015) -- a Ricardian model
with sectoral linkages, trade in intermediate goods and
sectoral heterogeneity -- to allow for changes in trade
costs due to improvements in transportation infrastructure,
financed through domestic taxation, connecting multiple
countries. The model highlights the trade impact of
infrastructure investments through cross-border input-output
linkages. This framework is then used to quantify the impact
of the Belt and Road Initiative. Using new estimates on the
effects on trade costs of transport infrastructure related
to the initiative based on Geographic Information System
analysis, the model shows that gross domestic product will
increase by up to 3.4 percent for participating countries
and by up to 2.9 percent for the world. Because trade gains
are not commensurate with projected investments, some
countries may experience a negative welfare effect due to
the high cost of the infrastructure. The analysis also finds
strong complementarity between infrastructure investment and
trade policy reforms. |
format |
Working Paper |
author |
De Soyres, Francois Mulabdic, Alen Ruta, Michele |
author_facet |
De Soyres, Francois Mulabdic, Alen Ruta, Michele |
author_sort |
De Soyres, Francois |
title |
Common Transport Infrastructure : A Quantitative Model and Estimates from the Belt and Road Initiative |
title_short |
Common Transport Infrastructure : A Quantitative Model and Estimates from the Belt and Road Initiative |
title_full |
Common Transport Infrastructure : A Quantitative Model and Estimates from the Belt and Road Initiative |
title_fullStr |
Common Transport Infrastructure : A Quantitative Model and Estimates from the Belt and Road Initiative |
title_full_unstemmed |
Common Transport Infrastructure : A Quantitative Model and Estimates from the Belt and Road Initiative |
title_sort |
common transport infrastructure : a quantitative model and estimates from the belt and road initiative |
publisher |
World Bank, Washington, DC |
publishDate |
2019 |
url |
http://documents.worldbank.org/curated/en/879031554144957551/Common-Transport-Infrastructure-A-Quantitative-Model-and-Estimates-from-the-Belt-and-Road-Initiative http://hdl.handle.net/10986/31496 |
_version_ |
1764474457571721216 |