Poverty Effects of Russia's WTO Accession : Modeling "Real" Households and Endogenous Productivity Effects

The authors use a computable general equilibrium comparative static model of the Russian economy to assess the impact of accession to the World Trade Organization (WTO) on income distribution and the poor. Their model is innovative in that they incorporate all 55,000 households from the Russian Hous...

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Main Authors:	Rutherford, Thomas, Tarr, David, Shepotylo, Oleksandr
Format:	Policy Research Working Paper
Language:	English
Published:	World Bank, Washington, DC 2012
Subjects:	ACCOUNTING ASSETS AVERAGE COSTS BASE YEAR BENCHMARK BUSINESS SERVICES CITIES COMMODITIES CONSTANT MARGINAL COSTS CONSTANT RETURNS TO SCALE CONSUMERS CONSUMPTION EXPENDITURES CONTRACT ENFORCEMENT DEMAND CURVE DISPLACED WORKERS DISTRIBUTION OF INCOME DIVIDENDS ECONOMIC ACTIVITY ECONOMIC GEOGRAPHY ECONOMIC GROWTH ECONOMIC PERFORMANCE ECONOMIC POLICIES ECONOMIC THEORY ECONOMICS ECONOMICS LITERATURE ELASTICITY EMPIRICAL EVIDENCE EQUILIBRIUM EQUILIBRIUM PRICES EQUITY ISSUES EQUIVALENT VARIATION EXPORTS EXTERNALITIES EXTERNALITY FOREIGN DIRECT INVESTMENT FOREIGN FIRMS GDP GENDER GENERAL EQUILIBRIUM GENERAL EQUILIBRIUM MODEL GENERAL EQUILIBRIUM MODELS GROWTH RATE HOUSEHOLDS IMPORTS INCOME INCOME DISTRIBUTION INCOME GROUPS INCREASING RETURNS INCREASING RETURNS TO SCALE INSURANCE INTERMEDIATE GOODS INTERNATIONAL DEVELOPMENT LIVING STANDARDS MARGINAL COSTS MARKET PRICES METALS MONOPOLISTIC COMPETITION MONOPOLY RENTS MULTINATIONAL FIRMS OIL OPTIMIZATION OUTPUTS PER CAPITA INCOME PRICE CHANGES PRODUCERS PRODUCT DIFFERENTIATION PRODUCTIVITY PRODUCTIVITY GROWTH PROFITABILITY RATE OF RETURN REGULATORY BARRIERS SAFETY SAFETY NETS SAVINGS SECURITIES TARIFF BARRIERS TAX RATES TELECOMMUNICATIONS TOTAL FACTOR PRODUCTIVITY TRADE LIBERALIZATION UNEMPLOYMENT UTILITY FUNCTION UTILITY FUNCTIONS VALUE ADDED WAGES WELFARE EFFECTS WELFARE GAINS WORLD TRADE ORGANIZATION WTO
Online Access:	http://documents.worldbank.org/curated/en/2005/01/5601479/poverty-effects-russias-wto-accession-modeling-real-households-endogenous-productivity-effects http://hdl.handle.net/10986/8895

id	okr-10986-8895
recordtype	oai_dc
spelling	okr-10986-88952021-04-23T14:02:42Z Poverty Effects of Russia's WTO Accession : Modeling "Real" Households and Endogenous Productivity Effects Rutherford, Thomas Tarr, David Shepotylo, Oleksandr ACCOUNTING ASSETS AVERAGE COSTS BASE YEAR BENCHMARK BUSINESS SERVICES CITIES COMMODITIES CONSTANT MARGINAL COSTS CONSTANT RETURNS TO SCALE CONSUMERS CONSUMPTION EXPENDITURES CONTRACT ENFORCEMENT DEMAND CURVE DISPLACED WORKERS DISTRIBUTION OF INCOME DIVIDENDS ECONOMIC ACTIVITY ECONOMIC GEOGRAPHY ECONOMIC GROWTH ECONOMIC PERFORMANCE ECONOMIC POLICIES ECONOMIC THEORY ECONOMICS ECONOMICS LITERATURE ELASTICITY EMPIRICAL EVIDENCE EQUILIBRIUM EQUILIBRIUM PRICES EQUITY ISSUES EQUIVALENT VARIATION EXPORTS EXTERNALITIES EXTERNALITY FOREIGN DIRECT INVESTMENT FOREIGN FIRMS GDP GENDER GENERAL EQUILIBRIUM GENERAL EQUILIBRIUM MODEL GENERAL EQUILIBRIUM MODELS GROWTH RATE HOUSEHOLDS IMPORTS INCOME INCOME DISTRIBUTION INCOME GROUPS INCREASING RETURNS INCREASING RETURNS TO SCALE INSURANCE INTERMEDIATE GOODS INTERNATIONAL DEVELOPMENT LIVING STANDARDS MARGINAL COSTS MARKET PRICES METALS MONOPOLISTIC COMPETITION MONOPOLY RENTS MULTINATIONAL FIRMS OIL OPTIMIZATION OUTPUTS PER CAPITA INCOME PRICE CHANGES PRODUCERS PRODUCT DIFFERENTIATION PRODUCTIVITY PRODUCTIVITY GROWTH PROFITABILITY RATE OF RETURN REGULATORY BARRIERS SAFETY SAFETY NETS SAVINGS SECURITIES TARIFF BARRIERS TAX RATES TELECOMMUNICATIONS TOTAL FACTOR PRODUCTIVITY TRADE LIBERALIZATION UNEMPLOYMENT UTILITY FUNCTION UTILITY FUNCTIONS VALUE ADDED WAGES WELFARE EFFECTS WELFARE GAINS WORLD TRADE ORGANIZATION WTO The authors use a computable general equilibrium comparative static model of the Russian economy to assess the impact of accession to the World Trade Organization (WTO) on income distribution and the poor. Their model is innovative in that they incorporate all 55,000 households from the Russian Household Budget Survey as "real" households in the model. This is accomplished because they develop a new algorithm for solving general equilibrium models with a large number of agents. In addition, they include foreign direct investment and Dixit-Stiglitz endogenous productivity effects in their trade and poverty analysis. In the medium term, the authors find that virtually all households gain from Russian WTO accession, with 99.9 percent of the estimated gains falling within a range between 2 and 25 percent increases in household income. They show that their estimates are decisively affected by liberalization of barriers against foreign direct investment in business services sectors and endogenous productivity effects in business services and goods. The authors use their integrated model to assess the error associated with a "top down" approach to micro-simulation. They find that approximation errors introduced by failing to account for income effects in the conventional sequential approach are very small. However, data reconciliation between the national accounts and the household budget survey is important to the results. Despite the estimated gains for virtually all households in the medium term, many households may lose in the short term because of the costs of transition. So, safety nets are crucial for the poorest members of society during the transition. 2012-06-22T22:00:24Z 2012-06-22T22:00:24Z 2005-01 http://documents.worldbank.org/curated/en/2005/01/5601479/poverty-effects-russias-wto-accession-modeling-real-households-endogenous-productivity-effects http://hdl.handle.net/10986/8895 English Policy Research Working Paper; No. 3473 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research Europe and Central Asia Russian Federation
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	ACCOUNTING ASSETS AVERAGE COSTS BASE YEAR BENCHMARK BUSINESS SERVICES CITIES COMMODITIES CONSTANT MARGINAL COSTS CONSTANT RETURNS TO SCALE CONSUMERS CONSUMPTION EXPENDITURES CONTRACT ENFORCEMENT DEMAND CURVE DISPLACED WORKERS DISTRIBUTION OF INCOME DIVIDENDS ECONOMIC ACTIVITY ECONOMIC GEOGRAPHY ECONOMIC GROWTH ECONOMIC PERFORMANCE ECONOMIC POLICIES ECONOMIC THEORY ECONOMICS ECONOMICS LITERATURE ELASTICITY EMPIRICAL EVIDENCE EQUILIBRIUM EQUILIBRIUM PRICES EQUITY ISSUES EQUIVALENT VARIATION EXPORTS EXTERNALITIES EXTERNALITY FOREIGN DIRECT INVESTMENT FOREIGN FIRMS GDP GENDER GENERAL EQUILIBRIUM GENERAL EQUILIBRIUM MODEL GENERAL EQUILIBRIUM MODELS GROWTH RATE HOUSEHOLDS IMPORTS INCOME INCOME DISTRIBUTION INCOME GROUPS INCREASING RETURNS INCREASING RETURNS TO SCALE INSURANCE INTERMEDIATE GOODS INTERNATIONAL DEVELOPMENT LIVING STANDARDS MARGINAL COSTS MARKET PRICES METALS MONOPOLISTIC COMPETITION MONOPOLY RENTS MULTINATIONAL FIRMS OIL OPTIMIZATION OUTPUTS PER CAPITA INCOME PRICE CHANGES PRODUCERS PRODUCT DIFFERENTIATION PRODUCTIVITY PRODUCTIVITY GROWTH PROFITABILITY RATE OF RETURN REGULATORY BARRIERS SAFETY SAFETY NETS SAVINGS SECURITIES TARIFF BARRIERS TAX RATES TELECOMMUNICATIONS TOTAL FACTOR PRODUCTIVITY TRADE LIBERALIZATION UNEMPLOYMENT UTILITY FUNCTION UTILITY FUNCTIONS VALUE ADDED WAGES WELFARE EFFECTS WELFARE GAINS WORLD TRADE ORGANIZATION WTO
spellingShingle	ACCOUNTING ASSETS AVERAGE COSTS BASE YEAR BENCHMARK BUSINESS SERVICES CITIES COMMODITIES CONSTANT MARGINAL COSTS CONSTANT RETURNS TO SCALE CONSUMERS CONSUMPTION EXPENDITURES CONTRACT ENFORCEMENT DEMAND CURVE DISPLACED WORKERS DISTRIBUTION OF INCOME DIVIDENDS ECONOMIC ACTIVITY ECONOMIC GEOGRAPHY ECONOMIC GROWTH ECONOMIC PERFORMANCE ECONOMIC POLICIES ECONOMIC THEORY ECONOMICS ECONOMICS LITERATURE ELASTICITY EMPIRICAL EVIDENCE EQUILIBRIUM EQUILIBRIUM PRICES EQUITY ISSUES EQUIVALENT VARIATION EXPORTS EXTERNALITIES EXTERNALITY FOREIGN DIRECT INVESTMENT FOREIGN FIRMS GDP GENDER GENERAL EQUILIBRIUM GENERAL EQUILIBRIUM MODEL GENERAL EQUILIBRIUM MODELS GROWTH RATE HOUSEHOLDS IMPORTS INCOME INCOME DISTRIBUTION INCOME GROUPS INCREASING RETURNS INCREASING RETURNS TO SCALE INSURANCE INTERMEDIATE GOODS INTERNATIONAL DEVELOPMENT LIVING STANDARDS MARGINAL COSTS MARKET PRICES METALS MONOPOLISTIC COMPETITION MONOPOLY RENTS MULTINATIONAL FIRMS OIL OPTIMIZATION OUTPUTS PER CAPITA INCOME PRICE CHANGES PRODUCERS PRODUCT DIFFERENTIATION PRODUCTIVITY PRODUCTIVITY GROWTH PROFITABILITY RATE OF RETURN REGULATORY BARRIERS SAFETY SAFETY NETS SAVINGS SECURITIES TARIFF BARRIERS TAX RATES TELECOMMUNICATIONS TOTAL FACTOR PRODUCTIVITY TRADE LIBERALIZATION UNEMPLOYMENT UTILITY FUNCTION UTILITY FUNCTIONS VALUE ADDED WAGES WELFARE EFFECTS WELFARE GAINS WORLD TRADE ORGANIZATION WTO Rutherford, Thomas Tarr, David Shepotylo, Oleksandr Poverty Effects of Russia's WTO Accession : Modeling "Real" Households and Endogenous Productivity Effects
geographic_facet	Europe and Central Asia Russian Federation
relation	Policy Research Working Paper; No. 3473
description	The authors use a computable general equilibrium comparative static model of the Russian economy to assess the impact of accession to the World Trade Organization (WTO) on income distribution and the poor. Their model is innovative in that they incorporate all 55,000 households from the Russian Household Budget Survey as "real" households in the model. This is accomplished because they develop a new algorithm for solving general equilibrium models with a large number of agents. In addition, they include foreign direct investment and Dixit-Stiglitz endogenous productivity effects in their trade and poverty analysis. In the medium term, the authors find that virtually all households gain from Russian WTO accession, with 99.9 percent of the estimated gains falling within a range between 2 and 25 percent increases in household income. They show that their estimates are decisively affected by liberalization of barriers against foreign direct investment in business services sectors and endogenous productivity effects in business services and goods. The authors use their integrated model to assess the error associated with a "top down" approach to micro-simulation. They find that approximation errors introduced by failing to account for income effects in the conventional sequential approach are very small. However, data reconciliation between the national accounts and the household budget survey is important to the results. Despite the estimated gains for virtually all households in the medium term, many households may lose in the short term because of the costs of transition. So, safety nets are crucial for the poorest members of society during the transition.
format	Publications & Research :: Policy Research Working Paper
author	Rutherford, Thomas Tarr, David Shepotylo, Oleksandr
author_facet	Rutherford, Thomas Tarr, David Shepotylo, Oleksandr
author_sort	Rutherford, Thomas
title	Poverty Effects of Russia's WTO Accession : Modeling "Real" Households and Endogenous Productivity Effects
title_short	Poverty Effects of Russia's WTO Accession : Modeling "Real" Households and Endogenous Productivity Effects
title_full	Poverty Effects of Russia's WTO Accession : Modeling "Real" Households and Endogenous Productivity Effects
title_fullStr	Poverty Effects of Russia's WTO Accession : Modeling "Real" Households and Endogenous Productivity Effects
title_full_unstemmed	Poverty Effects of Russia's WTO Accession : Modeling "Real" Households and Endogenous Productivity Effects
title_sort	poverty effects of russia's wto accession : modeling "real" households and endogenous productivity effects
publisher	World Bank, Washington, DC
publishDate	2012
url	http://documents.worldbank.org/curated/en/2005/01/5601479/poverty-effects-russias-wto-accession-modeling-real-households-endogenous-productivity-effects http://hdl.handle.net/10986/8895
_version_	1764406942097211392

Poverty Effects of Russia's WTO Accession : Modeling "Real" Households and Endogenous Productivity Effects

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