Effects of tariff liberalization on the global forest sector: application of the GTAP model

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This study investigated the effects of tariff liberalization on the global forest sector by using a computable general equilibrium model, based on the standard Global Trade Analysis Project (GTAP) model and its database, version 5. Tariff liberalization would generally cause only small changes in the terms of trade, real GDP, and the consumption and prices of forest products in most countries. National welfare would increase substantially in Indonesia by more than one billion US dollars in the long run. The prices of forest products would decrease in most countries. The effects of tariff liberalization would also be small on production with few exceptions, for example Indonesia and Malaysia. The major impact of tariff liberalization would be on trade of the developing countries in South America and Asia. Some of the changes in exports or imports of forest products could be more than 50%.

Keywords: computable general equilibrium model; forest sector; national welfare; tariff liberalization; trade

Document Type: Research Article

DOI: http://dx.doi.org/10.1505/ifor.2005.7.3.218

Affiliations: 1: Lecturer, Department of International Trade, Jin-Wen Institute of Technology, Taipei, Taiwan. 2: Associate Professor, Department of Finance, Shih Hsin University, No. 1 Lane 17 Sec.1 Mu-Cha Rd. Taipei, Taiwan. 3: Professor, Department of Public Finance, Jin-Wen Institute of Technology, 99 An-Chung Rd. Sindian City, Taipei, Taiwan 231.

Publication date: September 1, 2005

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