Poverty Implications of Agricultural and Non-Agricultural Price Distortions in Pakistan

Using recent estimates of industry assistance rates, the effects of trade liberalization in the rest of the world and in Pakistan alone are analyzed using a global and a Pakistan computable general equilibrium (CGE) model under two tax replacement...

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Bibliographic Details
Main Authors:	Cororaton, Caesar B., Orden, David
Format:	Working Paper
Language:	English en_US
Published:	World Bank, Washington, DC 2017
Subjects:	ACCOUNTING AGRICULTURAL COMMODITIES AGRICULTURAL COMMODITY AGRICULTURAL LIBERALIZATION AGRICULTURAL OUTPUT AGRICULTURAL PRICE AGRICULTURAL PRICES AGRICULTURAL PRODUCTION AGRICULTURAL PRODUCTS AGRICULTURAL SECTOR AGRICULTURAL WORKERS AGRICULTURE BORDER PRICE BUDGET IMPLICATION CAPITAL ACCUMULATION COMMERCE COMMODITIES COMMODITY COMMODITY PRICE COMMODITY PRICES COMPETITIVENESS CONSUMER PRICE CONSUMER PRICE INDEX CONSUMER PRICES CONSUMERS CONSUMPTION INCREASES DECLINING WAGES DEMAND CURVE DEMAND ELASTICITY DEMAND FUNCTION DEVELOPING COUNTRIES DEVELOPMENT ECONOMICS DISPOSABLE INCOME DIVIDEND DIVIDEND INCOME DIVIDENDS DOMESTIC INFLATION DOMESTIC MARKET DOMESTIC MARKETS DOMESTIC PRICE DOMESTIC PRICES DROUGHT DYNAMIC ANALYSIS ECONOMIC MODELS ECONOMIC STRUCTURE ELASTICITY ELASTICITY OF SUBSTITUTION EQUILIBRIUM PRICES ESTIMATES OF POVERTY EXCHANGE RATE EXPENDITURE EXPORT MARKET EXPORT SECTORS EXPORTS FACTOR PRICES FACTORS OF PRODUCTION FARM ACTIVITIES FARM HOUSEHOLDS FARM PRODUCTIVITY FARM PRODUCTS FARMERS FINANCING REQUIREMENT FISCAL BURDEN FIXED EXCHANGE RATE FOOD POLICY FOREIGN DIRECT INVESTMENTS FOREIGN EXCHANGE FOREIGN TRADE GLOBAL POVERTY GLOBAL TRADE GOVERNMENT BUDGET GOVERNMENT FUNDS GOVERNMENT INTERVENTION GOVERNMENT INVOLVEMENT GOVERNMENT REVENUE GROSS VALUE HOUSEHOLD CONSUMPTION HOUSEHOLD INCOME HOUSEHOLD INCOMES HOUSEHOLD SAVINGS HOUSEHOLD WELFARE INCIDENCE OF POVERTY INCOME INCOME EFFECTS INCOME INEQUALITY INCOME REDISTRIBUTION INCOME TAX INCOME TAXES INCOMES INDUSTRIALIZATION INEQUALITY INFLATION IRRIGATION LABOR MARKET LAND HOLDINGS LANDHOLDINGS LANDOWNERS LIBERALIZATIONS LOCAL CURRENCY MANUFACTURING INDUSTRIES MARKET PRICES MARKETING MONOPOLY NATIONAL INCOME NATIONAL POVERTY NATIONAL POVERTY LINE NOMINAL INCOME POLITICAL ECONOMY POOR POOR HOUSEHOLD POOR HOUSEHOLDS POVERTY GAP POVERTY IMPACT POVERTY INCIDENCE POVERTY INDEX POVERTY INDICATORS POVERTY INDICES POVERTY LINES POVERTY MEASURES POVERTY RATES POVERTY REDUCTION POVERTY SEVERITY PRICE CHANGE PRICE CHANGES PRICE DISTORTIONS PRICE INCREASES PRICE LEVELS PRICING POLICIES PRODUCTION FUNCTION PRODUCTION STRUCTURE RATE OF RETURN RATE OF RETURN TO CAPITAL RATES OF RETURN REAL EXCHANGE RATE REAL GDP REAL INCOME REMITTANCES RETURNS RURAL RURAL AREA RURAL AREAS RURAL DEVELOPMENT RURAL GROWTH RURAL HOUSEHOLDS RURAL POOR RURAL POVERTY RURAL POVERTY INCIDENCE SALE SALES SAVINGS SKILLED WORKERS SMALL FARMS SUBSTITUTES SUPPLY CURVE SUPPLY ELASTICITY SUPPLY FUNCTION SUSTAINABLE DEVELOPMENT TARIFF REVENUE TAX TAX POLICY TAX RATE TAX STRUCTURE TAXATION TRADE LIBERALIZATION TRADE POLICIES TRADE SECTOR TRADE SECTORS TRADE TAX TRADE TAXES TRUST FUNDS VALUE ADDED WAGE RATES WAGES WORKERS EXPERIENCE WORLD MARKET WORLD TRADE WTO
Online Access:	http://documents.worldbank.org/curated/en/171911468156902227/Poverty-implications-of-agricultural-and-non-agricultural-price-distortions-in-Pakistan http://hdl.handle.net/10986/28179

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Summary:	Using recent estimates of industry assistance rates, the effects of trade liberalization in the rest of the world and in Pakistan alone are analyzed using a global and a Pakistan computable general equilibrium (CGE) model under two tax replacement schemes: a direct income tax and an indirect tax replacement. The results indicate that the distributional and poverty effects in Pakistan of a unilateral liberalization of all traded goods are significantly greater than the effects of trade liberalization in the rest of the world. There is relatively higher increase in real income and larger decline in poverty incidence in poor households both in rural and urban areas. The effects of agricultural trade liberalization alone in both the rest of the world and in Pakistan are considerably smaller than those from trade liberalization involving all goods. In both the agricultural and all-goods trade liberalization scenarios involving direct income tax replacement, real household income is raised and the poverty incidence is lowered at varied rates across all household groups except for the urban non-poor. When an indirect tax replacement is used, where the burden of replacing tariff revenue is shared by all household groups depending on their consumption structure, there is reduction in household income for most of the groups and less reduction of poverty.

Poverty Implications of Agricultural and Non-Agricultural Price Distortions in Pakistan

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