Working Paper: CEPR ID: DP4592
Authors: Kym Anderson
Abstract: This is one of ten studies for the Copenhagen Consensus Project that sought to evaluate the most feasible opportunities to improve welfare globally and alleviate poverty in developing countries. It argues that phasing out distortionary government subsidies and barriers to international trade will yield an extraordinarily high benefit/cost ratio. A survey is provided of recent estimates, using global economy wide simulation models, of the benefits of doing that via the current Doha round of multilateral trade negotiations. Even if adjustment costs are several times as large as suggested by available estimates, the benefit-cost ratio from seizing this opportunity exceeds 20. That is much higher than the rewards from regional or bilateral trade agreements or from providing preferential access for least-developed countries? exports to high-income countries. Such reform would simultaneously contribute to alleviating several of the other key challenges reflected in the United Nations? Millennium Development Goals.
Keywords: Doha Development Agenda; Subsidy Reduction; Trade Policy Reform
JEL Codes: F02; F13; F15; F17
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| reducing government subsidies (H23) | economic benefits (D61) |
| reducing trade barriers (F13) | economic benefits (D61) |
| reducing trade barriers (F13) | poverty alleviation (I32) |
| trade liberalization (F13) | economic impacts on developing countries (F63) |
| reducing trade barriers (F13) | efficient resource allocation (D61) |
| efficient resource allocation (D61) | alleviating international challenges (F51) |
| trade reform (F13) | direct poverty alleviation (I32) |