2020 ASSA Meeting presentation

Dr Walmsley presented a paper on the impact of trade liberalization on income inequality in Pakistan at the 2020 ASSA Meetings in San Diego. The paper was part of a session hosted by the American Committee on Asian Economic Studies and chaired by Calla Wiemer.

The paper, co-authored with Muhammad Aamir Khan (COMSATS University, Pakistan) and Kakali Mukhopadhyay (McGill University, Canada and Gokhale Institute of Politics and Economics, India), examines the impact of various trade liberalization scenarios on income inequality in Pakistan using the MyGTAP modeling framework. Data on the incomes and consumption patterns of 16 rural and urban households in Pakistan were added and changes in the Gini coefficient calculated to examine the impact of various trade liberalization scenarios on income inequality.

The paper found that in the short run trade liberalization did not necessarily lead to an improvement in income inequality. In cases where income inequality fell, gains in the agricultural sector were key, with the incomes of non-farm and urban households often declining. In the long run, with greater mobility of labor and capital, income equality improved.