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Trade Policy Reform and the Missing Revenue †

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  • Channing Arndt
  • Finn Tarp

Abstract

In many African countries, large discrepancies exist between revenues implied by published tariff rates multiplied by estimated import volumes and actual receipts. We develop a stylised trade model where average and marginal tariff rates diverge and incorporate insights from this model into a computable general equilibrium model of an African economy (Mozambique) to study the implications of trade policy reform. Model simulations indicate that lowering tariff rates and reducing duty-free importation in a manner that maintains official revenue benefit nearly everyone. The main exception is those who benefited from duty-free imports in the base. Copyright 2008 The author 2007. Published by Oxford University Press on behalf of the Centre for the Study of African Economies. All rights reserved. For permissions, please email: journals.permissions@oxfordjournals.org, Oxford University Press.

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  • Channing Arndt & Finn Tarp, 2008. "Trade Policy Reform and the Missing Revenue †," Journal of African Economies, Centre for the Study of African Economies, vol. 17(1), pages 131-160, January.
    • Handle: RePEc:oup:jafrec:v:17:y:2008:i:1:p:131-160
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    Cited by:

    1. Godbertha Kinyondo & Margaret Mabugu, 2008. "The General Equilibrium Effects of a Productivity Increase on the Economy and Gender in South Africa," Working Papers 200801, University of Pretoria, Department of Economics.
    2. International Monetary Fund, 2007. "Republic of Mozambique: Selected Issues," IMF Staff Country Reports 2007/258, International Monetary Fund.
    3. Siddiqui, Rizwana, 2006. "Modelling Gender Dimensions of the Impact Of Economic Reforms in Pakistan," Conference papers 331468, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    4. Rizwana Siddiqui, 2005. "Modelling Gender Dimensions of the Impact of Economic Reforms on Time Allocation among Market, Household, and Leisure Activities in Pakistan," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 44(4), pages 615-639.
    5. World Bank, 2008. "Higher Fuel and Food Prices : Impacts and Responses for Mozambique," World Bank Publications - Reports 18909, The World Bank Group.
    6. Channing Arndt & Rui Benfica & Nelson Maximiano & Antonio M. D. Nucifora & James T. Thurlow, 2008. "Higher fuel and food prices: impacts and responses for Mozambique," Agricultural Economics, International Association of Agricultural Economists, vol. 39(s1), pages 497-511, November.

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