Bridging Bangladesh and India : Cross-Border Trade and the Motor Vehicles Agreement
This paper studies the effects of removing transport and trade barriers between Bangladesh and India on aggregate real income and the distribution of population and real income within both countries. The paper uses a spatial general equilibrium mod...
| Main Authors: | , , |
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| Format: | Working Paper |
| Language: | English |
| Published: |
World Bank, Washington, DC
2021
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/635471616767281403/Bridging-Bangladesh-and-India-Cross-Border-Trade-and-the-Motor-Vehicles-Agreement http://hdl.handle.net/10986/35356 |
| Summary: | This paper studies the effects of
removing transport and trade barriers between Bangladesh and
India on aggregate real income and the distribution of
population and real income within both countries. The paper
uses a spatial general equilibrium model calibrated to these
two economies, along with road network travel time
calculated using GPS data, to measure changes in economic
outcomes given changes in trade costs across regions. The
paper focuses on the Motor Vehicles Agreement between
Bangladesh, Bhutan, India, and Nepal and full transport and
trade integration between Bangladesh and India. The
counterfactual exercises show that decreasing transport and
trade barriers between Bangladesh and India can lead to up
to a 7.6 percent increase in national real income for India
and a 16.6 percent increase for Bangladesh. |
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