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Market access and poverty

by on December 2, 2011

The richness of Argentina, with vast fertile lands, highly educated people, cultural weight, and a highly mobile population can be deceiving. Driving through Buenos Aires there are vast differences between the haves and have-nots.

This excellent study (in PDF) helps build a link between national and international trade reform and how they have impacted poverty. The author, Guido Porto, studied the effect of developed nations lowering tariff barriers with Argentina, and Argentina lowering their domestic tariffs for international imports. He found that poverty could be significantly reduced (anywhere from 3-18%) based on increased access to Argentine goods internationally. There would be a lowered effect if Argentina lowered its tariffs to imports, but still significant.

In theory, this would be great. Unfortunately, this will not happen due to many countries unwilling to allow Argentine goods into their markets, simply for fear of competition with domestic producers, or of their perceived bias towards Argentina being unreliable.

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From → Economic Policy

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