Trade Policy Reform and the Missing Revenue

Posted: 23 Jun 2008

See all articles by Channing Arndt

Channing Arndt

United Nations - World Institute for Development Economics Research (UNU/WIDER)

Finn Tarp

University of Copenhagen - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: January 2008

Abstract

In many African countries, large discrepancies exist between revenues implied by published tariff rates multiplied by estimated import volumes and actual receipts. We develop a stylised trade model where average and marginal tariff rates diverge and incorporate insights from this model into a computable general equilibrium model of an African economy (Mozambique) to study the implications of trade policy reform. Model simulations indicate that lowering tariff rates and reducing duty-free importation in a manner that maintains official revenue benefit nearly everyone. The main exception is those who benefited from duty-free imports in the base.

Keywords: D58, H26, O55

Suggested Citation

Arndt, Channing and Tarp, Finn, Trade Policy Reform and the Missing Revenue (January 2008). Journal of African Economies, Vol. 17, Issue 1, pp. 131-160, 2008, Available at SSRN: https://ssrn.com/abstract=1149968 or http://dx.doi.org/ejm007

Channing Arndt (Contact Author)

United Nations - World Institute for Development Economics Research (UNU/WIDER) ( email )

Katajanokanlaituri 6 B
Helsinki, FI‐00160
Finland

Finn Tarp

University of Copenhagen - Department of Economics ( email )

Øster Farimagsgade 5
Bygning 26
1353 Copenhagen K.
Denmark

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