Modeling Services Liberalization : The Case of Tanzania
This paper employs a 52-sector, small, open-economy computable general equilibrium model of the Tanzanian economy to assess the impact of the liberalization of regulatory barriers against foreign and domestic business service providers in Tanzania....
| Main Authors: | , , |
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| Language: | English |
| Published: |
Washington, DC: World Bank
2012
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/2008/12/10134708/modeling-services-liberalization-case-tanzania http://hdl.handle.net/10986/6331 |
| Summary: | This paper employs a 52-sector, small,
open-economy computable general equilibrium model of the
Tanzanian economy to assess the impact of the liberalization
of regulatory barriers against foreign and domestic business
service providers in Tanzania. The model incorporates
productivity effects in both goods and services markets
endogenously, through a Dixit-Stiglitz framework. It
summarizes policy notes on the key business service sectors
that were prepared for this work, and estimates the ad
valorem equivalent of barriers to foreign direct investment
based on these policy notes and detailed questionnaires
completed by specialists in Tanzania. The authors estimate
that Tanzania will gain about 5.3 percent of the value of
Tanzanian consumption in the medium run (or about 4.8
percent of gross domestic product) from a full reform
package that also includes uniform tariffs. The estimated
gains increase to about 16 percent of consumption in the
long-run, steady-state model, where the impact on the
accumulation of capital from an improvement in the
productivity of capital is taken into account. Decomposition
exercises reveal that the largest gains to Tanzania will
derive from liberalization of costly regulatory barriers
that are non-discriminatory in their impacts between
Tanzanian and multinational service providers. |
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