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The Possible Effect of Ethiopian Trade in Service Liberalization on Welfare: A CGE Simulation Exercise

Abstract: 

The study has focused on the possible welfare effect of the service sector liberalization. The qualitative assessment, which is undertaken by evaluation of Ethiopian service sector policy compatibility to GATS principles, indicates that there is no perfect overlap of the two. This indicates existence of adjustment costs on liberalization. The quantitative assessment, on the other hand, has tried to quantify the net welfare effect of the liberalization with different scenarios at macro level using CGE model. The result of the simulations shows that the country derives higher welfare gain from liberalizing its service sector. Moreover, the comparison of service sector liberalization and goods trade liberalization shows that there is higher welfare gain in case of goods trade liberalization than service trade liberalization due to the relatively low protection in service sector than goods sector. Finally, simultaneous liberalization of the service and goods trade also shows higher welfare gain even though the welfare is less than the additive welfare of the separate liberalization of the two sectors

Corporate Author: 
Getnet Alemun & Ethiopian Economic Association/Ethiopian Economic Policy Research Institute
Publisher: 
Ethiopian Economic Association (EEA)
ISBN/ISSN: 
978-99944-54-14-7
Primary Descriptors: 

Liberalization

Secondary Descriptor: 

Services, Barriers

Geographic Descriptors: 
Ethiopia
Cataloge Date: 
02/27/2013
Broad Subject heading: 
Growth and Development
Call Number: 
330.963 PRO 2010
Serial Key Title: 
Proceedings of the Seventh International Conference on the Ethiopian Economy
Publication catagory: 
Content type: 
Volume: 
I
Publication date: 
2013-05-27 23:10:00
Forum or Discussion date: 
2013-02-27 15:02:21
Place of publication: 
Addis Ababa, Ethiopia
Type of material: 
Book
Current frequency: 
Annualy