Assessment of the distributive impact of national trade reforms in Brazil

JOURNAL OF ECONOMIC INEQUALITY on line first.on line first (2012).
http://works.bepress.com/cgi/viewcontent.cgi?article=1062&context=maximo_rossi

Fernando Borraz, Universidad de la Republica
Daniel Ferres, Universidad de Montevideo
Maximo Rossi, Universidad del Uruguay - Departamento de Economía (dECON)

Abstract

This paper quantifies the distributional and poverty effects of trade liberalization in Brazil using household survey data. We estimate the consumption and labor impact of Mercosur trade reform following the methodology suggested by Porto (J Int Econ 70:140–160, 2006) and Nicita (J Dev Econ 89(1):19–27, 2009). Results show that trade liberalization had a pro-poor effect in Brazil. This result is largely explained by two major observations: the fact that consumption good prices decreased after Brazil entered Mercosur and a close to zero labor income effect. We find that poverty decreased after national trade liberalization (both for women and men). Additionally, we obtained no significant inequality effects after national trade reforms.

Suggested Citation

Fernando Borraz, Daniel Ferres, and Maximo Rossi. "Assessment of the distributive impact of national trade reforms in Brazil" JOURNAL OF ECONOMIC INEQUALITY on line first.on line first (2012).