Would Trade Liberalization Help the Poor of Brazil?

This paper addresses the potential effects of world agricultural trade liberalization on poverty and regional income distribution in Brazil, using an inter-regional applied general equilibrium (AGE) and a micro-simulation model of Brazil tailored for income distribution and poverty analysis by using a detailed representation of households. The model distinguishes 10 different labor types and has 270 different household expenditure patterns. Income can originate from 41 different production activities located in 27 different regions in the country. The AGE model communicates to a micro-simulation model that has around 112,000 Brazilian households and 264,000 adults. Poverty and income distribution indices are computed over the entire sample of households and persons, before and after the policy shocks. The simulated trade liberalization scenario causes agriculture to expand considerably and so, given the importance that agriculture still has for the poorest in Brazil, it has positive impacts on poverty in Brazil. The only states which show an increase in the number of poor households are Sao Paulo and Rio de Janeiro, where the bulk of the manufacturing activities in Brazil are concentrated. There is an even more positive impact on inequality. The higher fall in the poverty gap is shown to occur mainly on the poorest household groups, suggesting that the poorest among Brazil's poor will benefit more from global trade liberalization.

Bibliographic Details

Main Authors:	De Souza Ferreira Filho, Joaquim Bento, Horridge, Mark
Format:	Working Paper biblioteca
Language:	English en_US
Published:	World Bank, Washington, DC 2009-06
Subjects:	ACCOUNTING, AGRICULTURAL COMMODITIES, AGRICULTURAL LAND, AGRICULTURAL POLICY, AGRICULTURAL PRICES, AGRICULTURAL PRODUCT, AGRICULTURAL PRODUCTS, AGRICULTURAL SECTOR, AGRICULTURAL WAGES, AVERAGE HOUSEHOLD INCOME, BASE YEAR, CAPITAL RETURNS, CAPITAL STOCK, CAPITAL STOCKS, CHANGES IN POVERTY, COMMODITY, CONSUMER PRICE INDEX, CONSUMERS, DECOMPOSABLE POVERTY, DEMAND CURVES, DEVALUATION, DEVELOPING COUNTRIES, DEVELOPING COUNTRY, DISTRIBUTION OF INCOME, DROUGHT, ECONOMIC GROWTH, ECONOMICS, ELASTICITY, ELASTICITY OF SUBSTITUTION, EMPLOYMENT IN AGRICULTURE, EXCHANGE RATE, EXPORTS, EXPOSURE, EXTERNAL TRADE, EXTREME POVERTY, FAMILY INCOME, FAMILY INCOMES, FAMILY MEMBERS, FARM EMPLOYMENT, FARM PRODUCTS, FINANCIAL INSTITUTIONS, GDP, GDP PER CAPITA, GENERAL EQUILIBRIUM, GENERAL EQUILIBRIUM ANALYSIS, GLOBAL POVERTY, GROWTH RATE, HOUSEHOLD COMPOSITION, HOUSEHOLD CONSUMPTION, HOUSEHOLD INCOME, HOUSEHOLD INCOMES, HOUSEHOLD SURVEY, IMPACT ON POVERTY, INCOME, INCOME DISTRIBUTION, INCOME EFFECT, INCOME GROUP, INCOME GROUPS, INCOME INEQUALITY, INDICATORS OF POVERTY, INEQUALITY, LABOR DEMAND, LABOR FORCE, LABOR MARKET, LABOR MIGRATION, LAND DEMAND, LIVESTOCK PRODUCTION, MACROECONOMIC EFFECTS, MANUFACTURING INDUSTRIES, MARGINAL PRODUCTIVITY, METROPOLITAN REGIONS, MINIMUM WAGE, NATIONAL INCOME, NATIONAL POVERTY, NATURAL RESOURCES, NOMINAL INCOME, OCCUPATIONS, OUTPUTS, PER CAPITA INCOME, PER CAPITA INCOMES, POOR, POOR HOUSEHOLDS, POOR PEOPLE, POOR PERSONS, POORER REGIONS, POSITIVE EFFECTS, POVERTY ALLEVIATION, POVERTY ANALYSIS, POVERTY GAP, POVERTY GAP INDEX, POVERTY INDICATORS, POVERTY LEVELS, POVERTY LINE, POVERTY MEASURES, POVERTY REDUCTION, PRICE DISTORTIONS, PRODUCT MARKETS, REAL GDP, REAL INCOME, REAL WAGES, REDUCTION IN POVERTY, REGIONAL AVERAGE, REGIONAL BREAKDOWN, REGIONAL DIMENSION, REGIONAL INCOME, REGIONAL INDUSTRY, REGIONAL INEQUALITY, REGIONAL MODEL, REGIONAL OUTPUT, REGIONAL POPULATION, REGIONAL POVERTY, REGIONAL TRADE, RENTS, RURAL, RURAL AREAS, RURAL HOUSEHOLD, RURAL HOUSEHOLD INCOME, SCHOOLING, SKILLED WORKERS, STATIC EQUILIBRIUM, SUBSISTENCE, TAX, TAX RATE, TRADE BALANCE, TRADE LIBERALIZATION, TRADE POLICIES, TRADE POLICY, TRADE TAXES, TRANSFER PROGRAMS, UNEMPLOYED, UNEMPLOYMENT, UNEMPLOYMENT RATE, UNSKILLED LABOR, VEGETABLE OILS, VEGETABLES, WAGE DIFFERENTIALS, WORLD TRADE, WTO,
Online Access:	http://documents.worldbank.org/curated/en/117051468015593889/Would-trade-liberalization-help-the-poor-of-Brazil https://hdl.handle.net/10986/28171
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