Effects of trade liberalization on Taiwan: A computable general equilibrium analysis

Ji Chou, Yun Peng Chu, Shiu Tung Wang

Research output: Contribution to journalArticle

2 Citations (Scopus)

Abstract

Joining the GATT has been established as one of the most important economic and political targets of the Taiwan government. However, the effects of this action are difficult to establish. Because of the openness of Taiwan's domestic market there could be serious changes in the production structure and income distribution, especially in the relative status of the agricultural and nonagricultural sectors, of protected and unprotected sectors, and also of producers and consumers. The possible high cost of this move on society has caused its necessity to be questioned. In order to clear up the controversy surrounding this issue, this paper, uses a CGE model to analyse the possible effects of this policy change. Following proposals from the Final Draft of the Uruguay Round, we use tariff and nontariff barriers, aggregate measurement of support (AMS), and export quota in our model as policy tools. We omit liberalization in the service sector, because of quantification difficulties. Our analysis includes the impacts on resource allocation, production structure, income distribution and consumers' welfare.

Original languageEnglish
Pages (from-to)169-186
Number of pages18
JournalAsian Economic Journal
Volume11
Issue number2
Publication statusPublished - Jun 1997
Externally publishedYes

ASJC Scopus subject areas

  • Geography, Planning and Development
  • Development

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