Gains from Trade: Implications for Labour Market Adjustment and Poverty Reduction in Africa |
| |
| Authors: | Augustin Kwasi Fosu Andrew Mold |
| |
| Institution: | 1. Augustin Fosu, Deputy Director, United Nations University, World Institute for Development Economics Research (UNU‐WIDER), Helsinki, Finland;2. e‐mail: fosu@wider,unu.edu. Andrew Mold, UN Economic Commission for Latin America and the Caribbean (UN‐ECLAC), Santiago, Chile;3. e‐mail: amold@cepal.org. Neither institution nor the UN is responsible for the views expressed here. The authors are grateful to an anonymous referee and the editors, as well as to participants at the UNU‐WIDER Project Conference, ‘The Impact of Globalization on the World's Poor’, held in Johannesburg, South Africa, 1–2 December 2005, for their helpful and insightful comments on earlier drafts of this article. |
| |
| Abstract: | Abstract: This paper reassesses the gains from trade for sub‐Saharan Africa, and draws their implications for labour market adjustment and poverty reduction. It reviews previous studies on multilateral liberalization, focusing on the findings from Computable General Equilibrium (CGE) models with relevance to African economies. The implications of these findings for poverty reduction are discussed. Our own CGE exercise supports the hypothesis that African countries cannot expect substantial gains from further multilateral liberalization. Moreover, given the sharp contraction of import‐competing sectors in response to trade liberalization in many African economies, coupled with insufficient compensation through labour market adjustments in other sectors, this study suggests that the ultimate impact on poverty reduction is likely to be small or even negative. |
| |
| Keywords: | |
|
|
