Impact analysis of cotton subsidies on poverty: A CGE macro-accounting approach applied to Mali

Dorothee Boccanfuso and Luc Savard

Cahiers de recherche from Departement d'économique de l'École de gestion à l'Université de Sherbrooke

Abstract: In this paper, we construct the first country specific CGE model for Mali with a micro-simulation component to analyze the poverty and inequality changes of removing cotton subsidies in developed countries. We used the macro-accounting approach proposed by Chen and Ravallion (2004). This issue has attracted significant attention as is has contributed to stall the broader trade agenda. Research on the issue has been mainly done with partial equilibrium analysis with a few exceptions. We use the first CGE-micro-simulation model to investigate. A 17 sectors CGE model with almost 5000 households is used to demonstrate that removal of subsidies on cotton will contribute to significant decrease in poverty in Mali. Our results show that combining the cotton subsidies removal to other agricultural subsidies does not attenuate the positive effects observed. We also show that the subsidies removal would marginally contribute to decrease inequality in Mali.

Keywords: computable general equilibrium model; micro-simulation; poverty analysis; income distribution; agricultural subsidies (search for similar items in EconPapers)
JEL-codes: D31 D58 I32 Q17 (search for similar items in EconPapers)
Pages: 29 pages
Date: 2006
New Economics Papers: this item is included in nep-afr, nep-agr, nep-cmp, nep-dev and nep-int
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:shr:wpaper:06-04

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