Can Trade Help Poor People? The Role of Trade, Trade Policy and Market Access in Tanzania

18 Pages Posted: 11 May 2007

See all articles by Burcu Duygan-Bump

Burcu Duygan-Bump

Board of Governors of the Federal Reserve System

Jesse B. Bump

World Bank

Abstract

Many development economists prescribe trade as a poverty-reducing formula. But how is this elixir supposed to work? This article contributes to the lively debate on this topic with household evidence from Tanzania - a poor country even within sub-Saharan Africa, the poorest region. About 81% of the poor work in agriculture, which accounts for 88% of the export bundle. The article describes existing poverty and then evaluates the poverty-reduction potential of trade, trade policy and market access. The article extends the analysis by simulating tariff changes and four switching scenarios that swap some poor households into trade-related sectors, such as cash cropping or tourism, to project national poverty reductions of up to 5.6% and household income increases of up to 21.5%.

Suggested Citation

Duygan-Bump, Burcu and Bump, Jesse B., Can Trade Help Poor People? The Role of Trade, Trade Policy and Market Access in Tanzania. Development Policy Review, Vol. 25, No. 3, pp. 293-310, May 2007, Available at SSRN: https://ssrn.com/abstract=984703 or http://dx.doi.org/10.1111/j.1467-7679.2007.00371.x

Burcu Duygan-Bump (Contact Author)

Board of Governors of the Federal Reserve System ( email )

20th Street and Constitution Avenue NW
Washington, DC 20551
United States
2029124663 (Phone)

Jesse B. Bump

World Bank ( email )

1818 H Street, NW
Washington, DC 20433
United States

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