This paper offers a comprehensive analysis of poverty in India. It shows that regardless of which of the two official poverty lines the authors use, they see a steady decline in poverty in all states and for all social and religious groups.
... Exibir mais + Accelerated growth between fiscal years 20042005 and 2009-2010 also led to an accelerated decline in poverty rates. Moreover, the decline in poverty rates during these years has been sharper for the socially disadvantaged groups relative to upper caste groups so that the authors now observe a narrowing of the gap in the poverty rates between the two sets of social groups. The paper also provides a discussion of the recent controversies in India regarding the choice of poverty lines.
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This paper offers a comprehensive analysis of poverty in India. It shows that regardless of which of the two official poverty lines the authors use, they see a steady decline in poverty in all states and for all social and religious groups.
... Exibir mais + Accelerated growth between fiscal years 20042005 and 2009-2010 also led to an accelerated decline in poverty rates. Moreover, the decline in poverty rates during these years has been sharper for the socially disadvantaged groups relative to upper caste groups so that the authors now observe a narrowing of the gap in the poverty rates between the two sets of social groups. The paper also provides a discussion of the recent controversies in India regarding the choice of poverty lines.
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This paper offers a comprehensive analysis of poverty in India. It shows that no matter which of the two official poverty lines is used, poverty has declined steadily in all states and for all social and religious groups.
... Exibir mais + Accelerated growth between fiscal years 2004-2005 and 2009-2010 led to an accelerated decline in poverty rates. Moreover, the decline in poverty rates during these years was sharper for the socially disadvantaged groups relative to upper caste groups, so that a narrowing of the gap in the poverty rates is observed between the two sets of social groups. The paper also provides a discussion of the recent controversies in India regarding the choice of poverty lines.
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Documento de trabalho sobre pesquisa de políticas WPS6714 DEC 01, 2013
The authors examine the economic case for the South Asia Free Trade Area (SAFTA) Agreement signed on January 6, 2004 by India, Pakistan, Bangladesh, Sri Lanka, Nepal, Bhutan, and the Maldives.
... Exibir mais + They start with a detailed analysis of the preferential trading arrangements in South Asia to look at the region's experience to date and to draw lessons. Specifically, they examine the most effective free trade area in existence-the India-Sri Lanka Free Trade Area-and evaluate the developments under the South Asian Preferential Trade Area (SAPTA). The authors conclude that, considered in isolation, the economic case for SAFTA is weak. When compared with the rest of the world, the region is tiny both in terms of economic size as measured by GDP (and per capita incomes) and the share in world trade. It is argued that these facts make it unlikely that trade diversion would be dominant as a result of SAFTA. This point is reinforced by the presence of high levels of protection in the region and the tendency of the member countries to establish highly restrictive "sectoral exceptions and sensitive lists" and stringent "rules of origin." The authors argue that the SAFTA makes sense only in the context of a much broader strategy of creating a larger preferential trade area in the region that specifically would encompass China and the member nations of the Association of South East Asian Nations. In turn, the case for the latter is strategic: the pursuit of regionalism in the Americas and Europe has created increasing discrimination against Asian exports to those regions, which must inevitably affect the region's terms of trade adversely. An Asian bloc could be a potential instrument of changing incentives for the trade blocs in the Americas and Europe and forcing multilateral freeing of trade. Assuming that the SAFTA Agreement is here to stay, the authors suggest steps to ensure that the Agreement can be made more effective in promoting intra-regional trade, while minimizing the likely trade-diversion costs and maximizing the potential benefits.
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Documento de trabalho sobre pesquisa de políticas WPS3813 JAN 01, 2006
Now that import-substitution policies have failed and been discredited, there has been a shift in favor of interventions on behalf of export interests.
... Exibir mais + The author argues that close scrutiny reveals these arguments to be as flawed as the old arguments for import substitution. Among other things, the author concludes that: 1) Under perfect competition, a country trying to retaliate against a trading partner's export subsidies by instituting its own export subsidies, will only hurt itself. 2) The argument that export subsidies may be useful for neutralizing import tariffs, is spurious. In most practical situations, this is not possible. Removal of tariffs is a far superior policy. 3) In principle, a case can be made for protecting infant export industries in the presence of externalities. But the empirical relevance of externalities remains as illusory for export industries as it was for import-substituting industries. 4) Adverse selection and moral hazard can lead to the thinning of the market for credit insurance, but that is not a case for government intervention. 5) India's experience shows export subsidies to have little impact on exports. Brazil and Mexico's experience shows export subsidies to be a costly instrument of export diversification. 6) Those who argue that pro-export interventions were important in East Asia have not provided convincing evidence of a casual relationship between the interventions and growth.
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Documento de trabalho sobre pesquisa de políticas WPS2276 JAN 31, 2000
This book contains a series of papers presented at the final conference sponsored by the Trade Expansion Program (TEP). The first chapter provides an overview of some of the lessons learned from the TEP's experience, among others, that trade policy reform is facilitated by the macroeconomic stability, even, though the last one, not necessarily needs a full attainment; that trade policy reform will only prove worthy when foreign exchange mechanisms are properly allocated; that trade reforms induce a self-sustaining behavior due to the credibility of such reforms; that the fiscal impact following trade reforms should be carefully considered, in order for these reforms to be effective and sustainable.
... Exibir mais + The issues addressed in the papers range from rather abstract (What makes trade reforms politically sustainable?) to intensely pragmatic (What is the most practical design for a duty drawback system or a technical assistance program?). Hence, a diversity in interests comes from the cross-fertilization of ideas produced by different perspectives on the subject of trade policy reforms.
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The authors analyze the U.S. demand for Bangladeshi imports for products restricted under the Multifiber Arrangement. Because Bangladesh is only a small supplier of these products and Latin American and Asian countries can supply close substitutes, the authors expected a high elasticity of demand for Bangladeshi imports, and they found consistently high estimates based on statistically significant coefficients.
... Exibir mais + Their finding accords with trade theorists' prejudice that small countries can essentially behave as price takers, but conflicts with the empirical literature view that demand elasticities are low, rarely exceeding 3 and generally between 1 and 2. The authors' analysis differs from the existing literature in three ways: they derive a set of estimation equations from an explicit, utility-maximization model and use the estimated parameters of the utility function to obtain the Marshallian own-price and cross-price elasticities as well as the income elasticity of demand; they take explicit account of U.S. imports from competitors of Bangladesh, relying directly on competitors' prices; and they use highly disaggregated data that make the unit value of exports a better proxy for price than using aggregated export data commonly used in this literature. The authors outline their theoretical model for deriving their estimated equations in Section 1; preliminarily determine who Bangladesh's competitors are in Section 2; and estimate the demand equation derived in Section 1, and derive the price and income elasticities facing Bangladesh in Section 3.
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Documento de trabalho sobre pesquisa de políticas WPS1712 DEC 31, 1996
To shed light on regional integration schemes in North America and Europe (and on the alleged trading bloc in East Asia), the authors explore the nature of bilateral trade relationships.
... Exibir mais + Using the gravity model, they conduct an econometric analysis of trade flows between major trading countries. They estimate bilateral trade flow equations using a data set for 45 countries over 12 years and then use those equations to study the contribution of trading blocs to intra-regionnal trade. Past investigators have estimated the gravity equation using data for total trade, pooling data across countries. The authors estimate separate equations for the exports and imports of 22 countries (nine in East Asia, six in Europe, three in North America, two in South America, and one in Oceania). Using 27 countries outside of North America, East Asia, and the founding members of the European Union (EEC) as the control countries, the authors test for each region's openness to trade with outside countries. They conclude that: 1) results based on individual-country equations differ greatly from those obtained from pooled, cross-country equations. In some cases, this difference is qualitative. Not surprisingly, in virtually all cases the cross-country equation masks large differences among countries. The coefficient asscociated with distance, for example, varies between -4.4 and -0.4 across the authors' equations. In almost every case the coefficient is statistically significant at a confidence level of 99 percent or more; 2) If there is an intra-regional bias in trade, it is more in North America and among the founding members of the European Union than in East Asia. Canada, the United States, and all countries of the EEC show an intra-regional bias in both exports and imports. In East Asia, on the other hand, exports in six out of nine countries have a statistically significant bias away from intra-regional markets; 3) There is little support for the hypothesis that East Asian markets are closed to trade with outside countries; and 4) Contrary to conventional wisdom, controlling for other variables, many countries export less to North America than to countries outside the three regions. Similiarly, countries outside the EEC export more to the EEC than to countries in the control group.
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Documento de trabalho sobre pesquisa de políticas WPS1370 OCT 31, 1994
The authors analyze the welfare effects of regional integration in a model of endogenous protection. They show that introducing preferential trading leads to an increase in protection against countries outside the preferential trading area.
... Exibir mais + Moreover, the important Meade result of preferential trading breaks down in the presence of endogenous protection. According to the Meade result, if excess demands exhibit net substitutability, the introduction of preferential trading is welfare-improving. In the presence of endogenous protection, because preferential trading is accompanied by increased protection against nonpartners, its effect on welfare is ambiguous. The authors also compare free trade areas and customs unions. They provide the first formal treatment of the argument that a customs union is a more effective instrument for diluting the power of interest groups than is a free trade area. Under a customs union, the tariff available to one country becomes available to all countries in the union. This introduces a free-rider problem in lobbying and all lobbying takes place in one country. The lobby chooses a lower (common) external tariff under a customs unions than under a free trade area. This means that welfare in the country where lobbying takes place is higher under a customs union than under a free trade area, although the same may not hold true for the other country. The level of the common external tariff declines as the number of members in the union increases. Therefore, the larger the number of partners in a customs union, the more likely it will improve the welfare of member countries. But, because of the free-rider problem, lobbies are likely to resist the enlargement of the customs union.
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Documento de trabalho sobre pesquisa de políticas WPS1261 MAR 31, 1994
The author studies the case for three different approaches to regionalism in East Asia. First, he examines closely the only serious attempt at preferential trading in the region - the Association of Southeast Asian Nations (ASEAN), which has recently announced plans to form the ASEAN Free Trade Area (AFTA).
... Exibir mais + Conclusion: the costs of such subregional schemes far outweigh their expected benefits. Second, he evaluates the case for a formal East Asian trading bloc along the lines of the European Community, and concludes that although the threat of such a bloc may serve some purpose, its actual execution might be difficult, given the diverse levels of protection across different countries in the region, and the possibility of retaliation from the United States through increased protection against East Asian goods. Third, he examines the case for simultaneous, most favored nation-style, nondiscriminatory regionwide liberalization. The author argues that although such a regional approach may be feasible, the case for it is far from airtight. On the one hand, this approach will face less resistance from the United States, and is likely to promote an open world trading system in the long run. On the other hand, in the short run it is likely to be resisted because of the adverse effect on terms of trade in the participating countries.
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Documento de trabalho sobre pesquisa de políticas WPS1209 OCT 31, 1993
Regional integration is on the rise again, despite its apparent failure among developing countries in the past. The authors survey the ambiguous economies of customs unions, emphasizing that the traditional dichotomy between "trade creation" and "trade diversion" is not particularly helpful for policy.
... Exibir mais + In a world with trade restrictions, regional integration presents certain advantages, including enhanced bargaining power and market access. The authors also point out that integration enforces arbitrage in institutions as well as in markets for goods and factors. This kind of arbitrage can lead to improved economic outcomes by making decision-making less sensitive to economically harmful factional interests - especially when regional institutions are designed properly. An empirical evaluation of existing schemes produces no evidence that membership in integration schemes has any effect on growth. Finally, the authors note that recent attempts at regional integration have different starting points and objectives than past efforts - so history is a poor guide to the future of regional integration.
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Documento de trabalho sobre pesquisa de políticas WPS1094 FEB 28, 1993
Regionalism is once again being viewed as a solution to the major international economic problems of our times. Slow progress of the negotiations at the Uruguay Round of the General Agreement on Tariffs and Trade (GATT) has led some economists to conclude that a division of the world into three trading blocs -- Europe, the Americas, and East Asia, is the fastest road to multilateral free trade.
... Exibir mais + They argue that negotiations for free trade are far more likely to succeed when conducted among three parties rather than among 154. For many countries, the proliferation of nontariff barriers in the industrial world has made regional integration an attractive policy option. However, the experience with South-South integration has been discouraging, and some economists claim that any temptation to promote such schemes in the future should be resisted. As for North-North integration, it has been widely successful in Europe. Intraregional trade expanded greatly, but not at the expense of trade with non-partners, which also grew rapidly. And European integration has greatly diminished, if not eliminated, the possibility of future internal conflicts. Looking to the future, North-South integration holds much promise for developing countries. Regional arrangements of this type can solidify past reforms, guarantee future access to a large market, and stimulate growth via increased direct foreign investment, more intense competition and faster technological diffusion.
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After lying dormant for two decades, regional integration is on the rise. Recent initiatives suggest that the world trading system may be moving toward three trading blocs clustered around Japan, the European Community, and the United States.
... Exibir mais + Some view this development as a move toward a less fragmented world trading system; others, as a threat to multilateralism. For a typical developing country, the issue is whether to enter into a regional integration arrangement or to choose unilateral trade liberalization. Two questions must be asked: Is a preferential approach likely to enhance economic efficiency? And are substantial benefits attainable more easily through regionalism or through unilateral trade liberalization? The authors address these issues first by reviewing past and recent regional integration arrangements. They note that recent arrangements are occurring in a more liberal trading environment than those in the past, and that developing countries are now seeking integration with developed country partners (for example, Mexico and the United States). So the context is different from past arrangements, when regional integration was viewed as an extension of import-substitution industrialization at the regional level. In a discussion of the welfare economics of preferential trading arrangements, they show that a preferential approach to trade liberalization may not increase welfare. For a small country, unilateral trade liberalization will be superior to a preferential approach unless the world divides into trading blocs with mutually high barriers - in which case, a preferential approach ensures market access. In a discussion of the welfare economics of trading blocs, they note that the move to a few trading blocs may make a cooperative solution more likely - at the same time increasing the rewards of noncooperative behavior if bargaining fails. With an empirical evaluation, the authors show that - after controlling for differences in investment - countries that integrated grew no faster than their comparator group. But human capital contributes significantly to growth, suggesting benefits from regional integration arrangements that emphasize cooperation. And there is evidence of catch-up, suggesting benefits for the least-developed members of the new wave of arrangements that emphasize North-South membership. In short, regional integration arrangements are more likely to be a stepping stone toward a freer world trading system if GATT rules are strengthened, and if developing countries enter into arrangements with developed rather than other developing countries.
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Documento de trabalho sobre pesquisa de políticas WPS985 OCT 31, 1992
de Melo, Jaime; Montenegro, Claudio; Panagariya, Arvind
Regionalism is once again being viewed as a solution to the major international economic problems of our times. Slow progress of the negotiations at the Uruguay Round of the General Agreement on Tariffs and Trade (GATT) has led some economists to conclude that a division of the world into three trading blocs -- Europe, the Americas, and East Asia, is the fastest road to multilateral free trade.
... Exibir mais + They argue that negotiations for free trade are far more likely to succeed when conducted among three parties rather than among 154. For many countries, the proliferation of nontariff barriers in the industrial world has made regional integration an attractive policy option. However, the experience with South-South integration has been discouraging, and some economists claim that any temptation to promote such schemes in the future should be resisted. As for North-North integration, it has been widely successful in Europe. Intraregional trade expanded greatly, but not at the expense of trade with non-partners, which also grew rapidly. And European integration has greatly diminished, if not eliminated, the possibility of future internal conflicts. Looking to the future, North-South integration holds much promise for developing countries. Regional arrangements of this type can solidify past reforms, guarantee future access to a large market, and stimulate growth via increased direct foreign investment, more intense competition and faster technological diffusion.
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Publicação 11477 JUL 06, 1992
De Melo, Jaime; Panagariya, Arvind Inglês,
Disclosed
This paper provides an analytic discussion of China's complex foreign trade regime and suggests policy reforms. The paper pays special attention to the implementation of national trade policies at provincial and city levels.
... Exibir mais + This is important for understanding developments in China's external sector because, during the 1980s, provinces began to enjoy a high degree of autonomy. The author draws specific examples at provincial and city levels form Jiangsu Province and Wuxi City. Jiangsu is one of the fastest growing provinces in China; it has also experienced a rapid growth in exports during the past 10 years. The paper provides a brief history of the developments in China's foreign trade regime. It discusses the major institutions responsible for China's foreign trade and outlines trade policies.
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Documento de trabalho sobre pesquisa de políticas WPS801 NOV 30, 1991
The authors are particularly interested in evaluating the concern that efficiency or policy-induced changes in the supply of exports of primary commodities, such as cocoa, coffee, and tea, may lead to such a large decline in the prices of those commodities that export revenues and incomes of the exporting countries actually decline.
... Exibir mais + This paper focuses on the implications of quantitative restrictions. It compares the implications of optimal Nash quotas and taxes when two or more countries compete against each other in the world market and finds that the outcome under taxes is less restrictive than under quotas but that the countries' profits are higher under quotas than under taxes. In simulations undertaken for the world cocoa market, it finds that for most countries optimal Nash taxes yield lower profits than the initial taxes or quotas. It also finds that even if countries choose taxes or quotas optimally, growth in a country can lead to a decline in the combined real income of the exporting countries. The simulations also cast doubt on the hypothesis that a market with five or more players can be regarded as roughly perfectly competitive.
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Documento de trabalho sobre pesquisa de políticas WPS756 AUG 31, 1991
During the 1980s the Bank aggressively promoted greater uniformity in tariffs in developing countries. The Bank's structural adjustment and trade reform programs have often recommended abolition of quantitative import restrictions and increased uniformity in tariffs.
... Exibir mais + This report is a formal analysis of some political economy arguments for uniform tariffs. The authors present three models in which unifrom tariff rules may be adopted as a way of minimizing the welfare costs of endogenously determined tariffs. In the first two models, tariffs are demand determined : the government is essentially unable to resist the lobbying pressure. In the third model, tariffs are supply determined in the sense that they result from the government's preference for certain sectors over others. After examining the three models, the authors conclude that in each case it is possible for a uniform tariff regime to yield higher welfare than a regime in which tariffs can diverge across sectors.
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Documento de trabalho sobre pesquisa de políticas WPS681 MAY 31, 1991
It has been argued that if several developing countries expand exports, they are likely to experience a decline in their terms of trade, export revenues, and real incomes.
... Exibir mais + The general case for this export pessimism has lost much of its force, but remains very much alive for some specific countries and commodities - particularly the export of cocoa, coffee, and tea, which exhibit low price elasticity. The authors of this paper systematically analyze this issue for cocoa, a commodity for which many African countries have a large share in world exports. Their concern is chiefly with the problems that arise from low price elasticity of demand in the world market and their implications for trade policy. They find that increasing productivity in one African country through new investments would benefit that country - but the other African countries would lose. On the whole, the African countries would gain, however, so the gains to the country with expanded output would dominate the losses for the other countries. The return on the new investments for Africa as a whole would be positive - although significantly lower than returns for the country in which the new investments were made. This paper examines how real incomes and tax and export revenues compare under existing taxes. It analyzes the impact of export expansion on real income, export and tax revenues, and compares the effects of export expansion by African countries with that by non-African countries.
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Documento de trabalho sobre pesquisa de políticas WPS537 NOV 30, 1990
This paper analyzes the welfare effects of raising tariffs on inputs, complemented by duty drawbacks on exports, in a small open economy. The main findings of the paper are as follows.
... Exibir mais + First, a tariff on the input unaccompanied by duty drawbacks on exports works like a production tax at different rates on goods using the input. The effect of such a tariff on welfare is ambiguous in general even if the tariffs on final imports are lowered so as to maintain a constant revenue. Second, a tariff on the input accompanied by a duty drawback on exports is equivalent to a production tax on the final import and a consumption tax on the export using the input. A small change of this type improves welfare unambigously provided the export and import goods using the input are substitutes in both production and consumption. This result holds even if the policy change leads to a contraction of exportables not using the input. Finally, the effect of a large tariff on the input accompanied by a duty drawback on exports is ambiguous in general but a presumption can be established in favor of a favorable effect. The last two results are reinforced by the presence of a revenue constraint.
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Documento de trabalho sobre pesquisa de políticas WPS336 MAY 31, 1990
In the course of trade-policy reforms, countries must confront at least two important questions with respect to tariffs. First, what is the optimal structure of tariffs?
... Exibir mais + In particular, is it optimal to tax all imports at a uniform rate? Second, should intermediate inputs be subject to import duties and if so is there a role for duty drawbacks on exports? This paper seeks to answer these important questions based on intuitive arguments, supported by literature and simple diagrams. The author argues that the introduction of tariffs on intermediate inputs complemented by duty drawbacks is welfare-improving. He further argues that if the objective is to protect the import-competing sector, uniform tariffs will minimize the distortion in production but not in consumption. If the objective is revenue, uniform tariffs will in general fail to minimize distortion in either production or consumption. The existence of smuggling, imperfect competition, and economies of scale weaken the case for uniform tariffs. The principal justification for uniform tariffs is their transparency, administrative simplicity, and relatively low level of unproductive profit-seeking activities. The author concludes that considerations of efficiency conflict with considerations of political economy. Ultimately the issue calls for more systematic empirical study.
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Documento de trabalho sobre pesquisa de políticas WPS353 FEB 28, 1990
