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Global Income Distribution and Poverty in the Absence of Agricultural Distortions

Author

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  • Bussolo, Maurizio
  • De Hoyos, Rafael
  • Medvedev, Denis
Abstract
This paper assesses the potential impacts of the removal of agriculture trade distortions using a newly developed dataset and methodological approach for evaluating the global poverty and inequality effects of policy reforms. It finds that liberalization of agriculture and food could increase global extreme poverty (US$1 a day) by 0.2 percent and lower moderate poverty (US$2 a day) by 0.3 percent. Beneath these small aggregate changes, most countries witness a substantial reduction in poverty while South Asia-where half of the world's poor reside-experiences an increase in extreme poverty incidence due to high rates of protection afforded to unskilled-intensive agricultural sectors. The distributional changes are likely to be mild, but exhibit a strong regional pattern. Inequality is likely to fall in regions such as Latin America, which are characterized by high initial inequality, and rise in regions like South Asia, characterized by low initial inequality.
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Suggested Citation

  • Bussolo, Maurizio & De Hoyos, Rafael & Medvedev, Denis, 2008. "Global Income Distribution and Poverty in the Absence of Agricultural Distortions," Conference papers 331764, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    • Handle: RePEc:ags:pugtwp:331764
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    File URL: https://ageconsearch.umn.edu/record/331764/files/4005.pdf
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    References listed on IDEAS

    as
    1. Kym Anderson, 2003. "Trade Liberalization, Agriculture, and Poverty in Low-income Countries," WIDER Working Paper Series DP2003-25, World Institute for Development Economic Research (UNU-WIDER).
    2. Chen, Shaohua & Ravallion, Martin, 2003. "Household welfare impacts of China's accession to the World Trade Organization," Policy Research Working Paper Series 3040, The World Bank.
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    6. Bussolo, Maurizio & De Hoyos, Rafael E. & Medvedev, Denis & van der Mensbrugghe, Dominique, 2007. "Global growth and distribution : are China and India reshaping the world?," Policy Research Working Paper Series 4392, The World Bank.
    7. Rodrik, Dani, 1998. "Why Is Trade Reform So Difficult in Africa?," Journal of African Economies, Centre for the Study of African Economies, vol. 7(0), pages 43-69, June.
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    Cited by:

    1. Rafael E. de Hoyos & Denis Medvedev, 2011. "Poverty Effects of Higher Food Prices: A Global Perspective," Review of Development Economics, Wiley Blackwell, vol. 15(3), pages 387-402, August.
    2. Unknown, 2014. "The new EU agricultural policy - continuation or revolution?," Multiannual Program Reports 179498, Institute of Agricultural and Food Economics - National Research Institute (IAFE-NRI).
    3. van der Mensbrugghe, Dominique & Valenzuela, Ernesto & Anderson, Kym, 2009. "Border Price and Export Demand Shocks for Developing Countries from Rest-of-World Trade Liberalization Using the Linkage Model," Agricultural Distortions Working Paper Series 52797, World Bank.

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