Lowering trade barriers improves income distribution and economic resiliency

Maksym Chepeliev, Maryla Maliszewska, Israel Osorio-Rodarte, Maria Filipa Seara e Pereira and Dominique van der Mensbrugghe
Authors registered in the RePEc Author Service: Israel Osorio Rodarte

Journal of Policy Modeling, 2025, vol. 47, issue 1, 30-48

Abstract: The U.S.-China trade war, COVID-19 pandemic and Russian invasion of Ukraine contributed to calls for greater economic self-sufficiency by exposing gaps in international collaboration and the uncertainty of global supply chains. In this study, we apply a comprehensive global modeling framework to enhance understanding of the potential impacts of fragmentation of global value chains. Supporting the general argument toward economic benefits from open markets our analysis contributes to the policy debate in two important dimensions of this phenomenon—distributional impacts and economic resiliency. We find that tariff liberalization and trade facilitation measures implemented by developing countries could not only reduce between-country inequality but also result in progressive within-country income distribution primarily through lowering food prices, as well as increasing unskilled wages. In addition, using a case study of disruption to Thailand’s electronics industry, we find higher resiliency of developing countries to external shocks in the globalized (as opposed to a localized) world.

Keywords: Economic resiliency; Global value chains; Income distribution; Microsimulation; Computable general equilibrium (search for similar items in EconPapers)
Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0161893824001388
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:jpolmo:v:47:y:2025:i:1:p:30-48

DOI: 10.1016/j.jpolmod.2024.09.004

Access Statistics for this article

Journal of Policy Modeling is currently edited by A. M. Costa

More articles in Journal of Policy Modeling from Elsevier
Bibliographic data for series maintained by Catherine Liu ().