Macroeconomic impacts of export commodity price subsidy in Papua New Guinea
A macroeconometric simulation study is undertaken to evaluate the impacts of a price subsidy for tree crops in Papua New Guinea (PNG). The price subsidy had favourable impacts on tree crop export income, aggregate demand, private consumption, and investment and employment. It increased imports, the budget deficit, and the demand for money and adversely affected the fiscal balance, inflation and interest rates, the BOP position and macroeconomic stability. The price subsidy contributed favourably to internal balance but adversely affected external balance. It worked against many of the policy objectives and made macroeconomic management difficult. With the introduction of the price subsidy, the government violated the commitments made under the Uruguay Round Agreement on Agriculture and PNG’s Structural Adjustment Program.
Year of publication: |
2001
|
---|---|
Authors: | Kannapiran, Chinna A. |
Published in: |
Australian Journal of Agricultural and Resource Economics. - Australian Agricultural and Resource Economics Society - AARES. - Vol. 45.2001, 3
|
Publisher: |
Australian Agricultural and Resource Economics Society - AARES |
Keywords: | International Relations/Trade |
Saved in:
freely available
Saved in favorites
Similar items by person
-
Determinants of private sector investment in Papua New Guinea : an error correction model analysis
Kannapiran, Chinna A., (2001)
-
Kannapiran, Chinna A., (2001)
-
Inflation targeting policy in Papua New Guinea : an econometric model analysis
Kannapiran, Chinna A., (2000)
- More ...