Global reform of trade policy will reduce poverty?

A new working paper published by WorldBank assessed how global reform of trade policy has relation with poverty reduction in Indonesia. The author, Peter Warr from Australian National Universty (ANU), argues the global reform in all commodities is a significant potential source of poverty reduction for Indonesia.

According to Warr, the poor –rural and urban—have a strong interest in global trade policy reform. If Indonesia were to liberalize unilaterally, poverty incidence also would decline but the effect is small. If liberalization is confined to agricultural products, the effects are similar but the declines in poverty incidence within Indonesia are much smaller.

Warr applied a general equilibrium modeling approach to estimate the effects the effects within Indonesia of unilateral and global trade liberalization, including effects on poverty incidence. Warr is one of ANU’s scientist focusing research on economies of Thailand and Indonesia. He become author and editor for three books and more than 100 academic journal articles and book chapter.

Enjoy the WB paper here.