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A Computable General Equilibrium Micro-Simulation Analysis of the Impact of Trade Policies on Poverty in Zimbabwe

Author

Listed:
  • Margaret Chitiga

    (Department of Economics, University of Pretoria)

  • Ramos Mabugu

    (Centre for Environmental Economics and Policy in Africa, Department of Agricultural Economics, University of Pretoria)

  • Tonia Kandiero

    (National Treasury)

Abstract

The paper uses a micro-simulation computable general equilibrium (CGE) model to study the impact on poverty of a complete removal of tariffs in Zimbabwe. The model incorporates 14006 households derived from the 1995 Poverty Assessment Study Survey. This paper’s novelty is that it is one among a small group of papers that incorporates individual households in the CGE model as opposed to having representative households. Using individual households allows for a comprehensive analysis of poverty. The complete removal of tariffs favours exporting sectors. Poverty falls in the economy while inequality hardly changes. The results differ between rural and urban areas.

Suggested Citation

  • Margaret Chitiga & Ramos Mabugu & Tonia Kandiero, 2007. "A Computable General Equilibrium Micro-Simulation Analysis of the Impact of Trade Policies on Poverty in Zimbabwe," Working Papers 200715, University of Pretoria, Department of Economics.
    • Handle: RePEc:pre:wpaper:200715
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    Cited by:

    1. Ole Boysen & Alan Matthews, 2008. "The Impact of Developed Country Agricultural Trade Liberalization on Poverty: A Survey," Working Papers hal-03416399, HAL.
    2. Kebede, Sindu & Fekadu, Belay & Aredo, Dejene, 2011. "Trade Liberalization and Poverty: A Macro-Micro Analysis in Ethiopia," Proceedings of the German Development Economics Conference, Berlin 2011 44, Verein für Socialpolitik, Research Committee Development Economics.
    3. Chala, Zelalem T. & Norton, George W. & Grant, Jason H., 2010. "Economic Significance of Specific Export Promotion on Poverty Reduction and Inter- Industry Growth of Ethiopia," 2010 Annual Meeting, July 25-27, 2010, Denver, Colorado 61739, Agricultural and Applied Economics Association.
    4. Rana Hendy & Chahir Zaki, 2013. "Assessing the Effects of Trade Liberalization on Wage Inequalities in Egypt: A Microsimulation Analysis," The International Trade Journal, Taylor & Francis Journals, vol. 27(1), pages 63-104, March.
    5. Ayoki, Milton, 2013. "Pursuing a pro-poor trade liberalization agenda: Regionalism, multilateralism and poverty in Uganda," MPRA Paper 83547, University Library of Munich, Germany.
    6. David Mhlanga & Steven Henry Dunga & Tankiso Moloi, 2020. "Financial Inclusion and Poverty Alleviation among Smallholder Farmers in Zimbabwe," Eurasian Journal of Economics and Finance, Eurasian Publications, vol. 8(3), pages 168-182.
    7. Acharya, Sanjaya & Cohen, Solomon, 2008. "Trade liberalisation and household welfare in Nepal," Journal of Policy Modeling, Elsevier, vol. 30(6), pages 1057-1060.
    8. Mahofa, Godfrey, 2007. "Economic Analysis of Factors Affecting Cotton Production In Zimbabwe," Research Theses 134490, Collaborative Masters Program in Agricultural and Applied Economics.
    9. Julius Mukarati & Itumeleng P. Mongale & Godswill Makombe, 2020. "Land redistribution and the South African economy," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 66(1), pages 46-54.
    10. Ayoki, Milton, 2013. "Computable General Equilibrium Micro Simulation Analysis of the Impact of Trade Policies on Poverty in Uganda," MPRA Paper 78876, University Library of Munich, Germany.
    11. Ramos Mabugu & Margaret Chitiga, 2009. "Liberalising Trade In South Africa: A Survey Of Computable General Equilibrium Studies," South African Journal of Economics, Economic Society of South Africa, vol. 77(3), pages 445-464, September.
    12. Binjian, Binjian & Sakamoto, Hiroshi, 2013. "Market Reform and Income Distribution in China : A CGE–Microsimulation Approach," AGI Working Paper Series 2013-13, Asian Growth Research Institute.
    13. Acharya, Sanjaya, 2011. "Making unilateral trade liberalisation beneficial to the poor," Socio-Economic Planning Sciences, Elsevier, vol. 45(2), pages 60-71, June.
    14. Ayoki, Milton, 2013. "Trade Policies and Poverty in Uganda: A Computable General Equilibrium Micro Simulation Analysis," MPRA Paper 80327, University Library of Munich, Germany.
    15. Ziaur Rahman, 2014. "The impact of trade liberalization on poverty reduction in Bangladesh: A computable general equilibrium (CGE) analysis," Asian Journal of Empirical Research, Asian Economic and Social Society, vol. 4(4), pages 240-253, April.

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    More about this item

    Keywords

    Computable General Equilibrium; Trade Liberalisation; Micro-simulation; Poverty; Inequality;
    All these keywords.

    JEL classification:

    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty

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