Citation
Discussion Paper Details
Please find the details for DP8594 in an easy to copy and paste format below:
Full Details | Bibliographic Reference
Full Details
Title: Pro-poor trade policy in Sub-Saharan Africa
Author(s): Alessandro Nicita, Marcelo Olarreaga and Guido Porto
Publication Date: October 2011
Keyword(s): Poverty, Sub-Saharan Africa, Trade policy and Wage elasticities
Programme Area(s): International Trade and Regional Economics
Abstract: The objective of this paper is to estimate the potential pro-poor bias in the existing structure of protection in six countries in Sub-Saharan Africa (SSA) (i.e., whether it redistributes income from rich to poor households). We also explore the extent to which the barriers faced by SSA exporters to the rest of the world are biased in favor of poor or rich households. To this end, we start with a simple agricultural household production model and propose an extension to include adjustments in labor income associated with changes in unskilled and skilled wages. We then build indicators that capture the differences in welfare changes across income levels associated with the elimination of SSA's own trade protection, as well as trade protection on SSA's export bundle by the rest of the world. Results suggest that SSA's own trade policy is biased in favor of poor households. In contrast, the trade policies of SSA's trading partners tend to be biased in favor of SSA's rich households, especially when ad-valorem equivalents of non tariff measures (NTMs) are taken into account.
For full details and related downloads, please visit: https://cepr.org/active/publications/discussion_papers/dp.php?dpno=8594
Bibliographic Reference
Nicita, A, Olarreaga, M and Porto, G. 2011. 'Pro-poor trade policy in Sub-Saharan Africa'. London, Centre for Economic Policy Research. https://cepr.org/active/publications/discussion_papers/dp.php?dpno=8594