Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

This paper provides a forward-looking view of trade and its relevance for Lesotho's medium- and long-term development. It does this through computable general equilibrium analysis of potential impacts based on specific trade-related scenarios. The scenarios include the potential loss of American Growth and Opportunities Act preferences and preference erosion against competitors through, for example, a United States-Vietnam Free Trade Area. An immediate loss of American Growth and Opportunities Act preferences would have a significant economic impact that far exceeds that of a potential future United States-Vietnam Free Trade Area. If these preferences were suspended in 2018, Lesotho would face a loss of 1 percent in income by 2020, relative to the baseline, and exports of textiles and apparel would drop by 16 percent. The computable general equilibrium simulations stress the need to strengthen efforts to support structural transformation leading to diversification of export products and markets, improving backward and forward linkages, and lowering trade costs. The simulations also indicate that trade facilitation measures leading to an average decrease in trade costs of 2 percent per year would eliminate the negative consequences of the loss of American Growth and Opportunities Act preferences in terms of the loss of income. The changing external environment is likely to offer new opportunities to Lesotho's export industries in the medium term, including through regional integration under the Continental Free Trade Area.

AGOA --- American Growth and Opportunities Act --- CGE Model --- Computable General Equilibrium Model --- International Economics and Trade --- Trade Policy --- Trade Preferences

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

Access to infrastructure supports economic development through both capital accumulation and structural transformation. This paper investigates the links between investments in electricity, Internet, and road infrastructure, in isolation and bundled, and economic development in the Horn of Africa, a region that includes countries with different levels of infrastructure and economic development. Using data on the expansion of the road, electricity, and Internet networks over the past two decades, it provides reduced-form estimates of the impacts of infrastructure investments on the sectoral composition of employment. Bundled infrastructure investments cause different patterns of structural transformation than isolated infrastructure investments. The impact of bundled road and electricity investments on reducing the sectoral employment share in agriculture is found to be 2.5 times larger than the impact of roads alone. The paper then uses a spatial general equilibrium model to quantify the impacts of future regional Transport investments, bundled with electricity and trade facilitation measures, on economic development in countries in the Horn of Africa.

Electricity --- General Equilibrium Model --- Infrastructure --- Infrastructure Economics --- Infrastructure Economics and Finance --- Infrastructure Investment --- Internet Access --- Road Infrastructure --- Roads and Highways --- Structural Transformation --- Transport --- Transport Corridor

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

Should the China-U.S. trade agreement prompt relief because it averts a damaging trade war or concern because selective preferential access for the United States to China's markets breaks multilateral rules against discrimination? The answer depends on how China implements the agreement. Simulations from a computable general equilibrium model suggest that the United States and China would be better off under this "managed trade" agreement than if the trade war had escalated. However, compared with the policy status quo, the deal will make everyone worse off except the United States and its input-supplying neighbor, Mexico. Real incomes in the rest of world would decline by 0.16 percent and in China by 0.38 percent because of trade diversion. China can reverse those losses if, instead of granting the United States privileged entry, it opens its market for all trading partners. Global income would be 0.6 percent higher than under the managed trade scenario, and China's income would be nearly 0.5 percent higher. By creating a stronger incentive for China to open its markets to all, an exercise in bilateral mercantilism has the potential to become an instrument for multilateral liberalization.

Access to Markets --- Bilateral Mercantilism --- Computable General Equilibrium Model --- International Economics and Trade --- International Trade and Trade Rules --- Managed Trade --- Preferential Access --- Preferential Trade Agreement --- Trade Diversion --- Trade Liberalization --- Trade Policy --- Trade War

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

The overall impacts on the Brazilian economy of reducing CO2 emissions from energy use and industrial processes can be assessed using a recursive dynamic general equilibrium model and a hypothetical carbon tax. The study projects that in 2040 under a business-as-usual scenario, CO2 emissions from energy use and industrial processes would be almost three times as high as in 2010 and would account for more than half of total national CO2 emissions. Current policy aims to reduce deforestation by 70 percent by 2017 and emissions intensity of the overall economy by 36-39 percent by 2020. If policy is implemented as planned and continued to 2040, CO2 emissions from energy use and industrial processes would not have to be cut until 2035 as reductions of emissions through controlling deforestation would be enough to meet emission targets. The study also finds evidence that supports the double dividend hypothesis: using revenue from a hypothetical carbon tax to finance a cut in labor income tax significantly lowers the gross domestic product impacts of the carbon tax. Using carbon tax revenue to subsidize wind power can effectively increase the output of wind power in the country, although the impact of the tax on gross domestic product would be somewhat increased.

Climate Change Economics --- Climate change mitigation --- Climate Change Mitigation and Green House Gases --- Computable General Equilibrium Model --- Energy --- Energy and Environment --- Energy Production and Transportation --- Environment --- Environment and Energy Efficiency --- Low carbon economic growth --- Brazil

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

This paper explores the economic impacts of preferential trade agreements, focusing on the provisions they contain, beyond phasing out tariffs. Clustering 278 preferential trade agreements based on 906 provisions grouped into 18 policy areas, three clusters are obtained for which a trade elasticity to preferential trade agreement is estimated using structural gravity. A series of full general equilibrium counterfactual situations for endowment economies is simulated, revealing the economic impacts of deepening existing trade agreements and signing new ones-that is, the intensive and extensive margins of preferential trade agreements. The paper illustrates the method with a general deepening of existing preferential trade agreements worldwide. Focusing on the examples of the Latin America and the Caribbean and East Asia and Pacific regions, the paper shows that deepening preferential trade agreements leads to higher trade and welfare effects than signing new ones.

Deep Integration --- Deep Trade Agreement --- General Equilibrium Model --- International Economics and Trade --- International Trade and Trade Rules --- Preferential Trade Agreements --- Structural Gravity --- Trade and Regional Integration --- Trade Liberalization --- Trade Policy