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Trade Liberalisation and Poverty in Bangladesh: A General Equilibrium Approach

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  • Nahar, Bodrun
  • Siriwardana, Mahinda

Abstract

This paper uses a computable general equilibrium (CGE) model to investigate the impact on poverty of trade liberalisation in Bangladesh. The simulation results show that the complete removal of tariffs favours export oriented sectors in the economy. With trade liberalisation, rural and urban areas experience an overall reduction in poverty in the short run. However, a marginal increase in the poverty gap and poverty severity for urban areas is projected, implying that the poor become poorer in urban areas. Moreover, poverty incidences vary among various socio-economic groups. In the short run, poverty incidence increases for rural landless and urban illiterate and low-educated household groups. In contrast, the long run results highlight that trade liberalisation reduces absolute poverty for all groups both in rural and urban areas.

Suggested Citation

  • Nahar, Bodrun & Siriwardana, Mahinda, 2009. "Trade Liberalisation and Poverty in Bangladesh: A General Equilibrium Approach," 2009 Conference (53rd), February 11-13, 2009, Cairns, Australia 47629, Australian Agricultural and Resource Economics Society.
    • Handle: RePEc:ags:aare09:47629
    DOI: 10.22004/ag.econ.47629
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    Cited by:

    1. Fatima, Amber & Shahbaz, Muhammad & Islam, Faridul, 2012. "Nexus of Trade, Investment and Poverty: Evidence from Pakistan," Bangladesh Development Studies, Bangladesh Institute of Development Studies (BIDS), vol. 35(2), pages 87-108, June.
    2. Khan, Muhammad Aamir, 2017. "Regional Trade and Economic Development: Options for Pakistan," Conference papers 332899, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.

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    Keywords

    International Relations/Trade; Food Security and Poverty;

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