Incidence theory and the shifting of protection across sectors: The South Asian experience

Document Type

Article

Publication Title

Applied Economics

Publication Date

1-20-2003

Abstract

Using the theoretical framework of a simple general equilibrium model, this paper examines whether strategies aimed at protecting or promoting manufacturing industries indirectly taxed the agricultural and service sectors. A panel data set consisting of five South Asian countries over a 26 year time period is employed in the analysis. Three different estimation procedures are used to account for factors that are country specific and those that are common to all countries. The results indicate that the agricultural sector indirectly felt the brunt of the net protection provided to manufactures due to the 'shifting of protection' across sectors. The service sector, on the other hand, indirectly benefited from the general equilibrium spillover effects.

Volume

35

Issue

2

First Page

125

Last Page

132

DOI

10.1080/0003684022000015892

ISSN

00036846

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