Fiscal policies and increased trade openness: Poverty impacts in Ecuador

We use a combined micro-simulation and computable general equilibrium model of the Ecuadorian economy to measure the impact on poverty of changes in fiscal policy in response to trade openness in Ecuador. This study is part of a growing branch of the empirical economics literature that seeks to examine the effects on poverty in countries that have opened their markets to global competition. We also study fiscal policies that the Government could use to compensate for tariff revenue loss. Analysing the impact of changes in trade and fiscal policies on poverty is a very important issue for a country such as Ecuador —a dollarized economy where poverty rates are high, particularly in the rural sector.

Sustainable Development Goals:

Industry, Innovation and Infrastructure

Peace, Justice and Strong Institutions