Federation was the beginning of a new era of the Australian trade policy with the introduction of free trade between states and the adoption of a common external tariff against imports. During the early years under the new Commonwealth government, revenue raising was the prime purpose of import dudes and protection to domestic industries was a secondary issue. The 1908 Lyne tariff was the first significant step towards a protectionist Australian tariff since federation. The second and more important tariff increase was the 1921 Green tariff when the Commonwealth decided to provide protection to industries which emerged during World War I. The establishment of the Tariff Board was another important policy decision of the year. There were number of tariff increases during the 1920s on the advice of the Tariff Board. While manufacturers were receiving protection, there was a growing dissatisfaction among the primary producers because they believed that the higher costs imposed on the Australian economy by tariffs were finally borne out by the farming sector. The policy of protection in Australia in the 1930s was to ensure that a significant change in income distribution would occur in favour of wage earners. However, the attitude toward such need has gradually diminished over last three decades. Hence it may be questioned whether the strong historical public support for protectionism in Australia distracted policy makers' attention from more efficient trade policy alternatives (Anderson and Garnaut, 1987, p.31). The purpose of this paper is to provide a quantitative assessment of this trade policy debate of the 1930s Australia. This is achieved by comparing the impact of a tax on wool exports with that of a uniform increase in tariffs on imports. We use a computable general equilibrium (CGE) model of the Australian economy in the 1930s Australia to derive the empirical results. A computable general equilibrium (CGE) model of the Australian economy in the 1930s is used to analyse the effects of protection to manufacturing and the impact of a tax on wool exports at macroeconomic and sectoral levels. The results lend support to the proposition that the policy of protection would have resulted in a higher national income and welfare for the inter-war Australian economy. This is the effect of improved terms of trade due to tariffs and the wage earners seemed to have benefited from that trade policy. The findings however reject the hypothesis that a tax on wool exports would have been a better substitute for a uniform tariff on all imports.

The Philippines has experienced deforestation all throughout the last century. Some scholars attribute it to excessive timber trade others to population growth. The population argument, which is in the centre of most environment-related issue, is valid from 1980s onwards in the case of the Philippines. Population was not an issue in the first half of the 20th century neither in the years before that, however, timber trade was. The Philippines became the single biggest exporter of logs in 1969, while population stood at around 36.7 million. The paper attempts to show using a computable general equilibrium (CGE) framework the relative contribution of population growth and foreign trade policies on deforestation in the case of the Philippines. A static CGE model based on ORANI with an appended sub-forestry model is employed in the analysis. The results show that (domestic) population per se would not significantly increase deforestation. Whilst, export taxes are ineffective tools in reducing deforestation, trade liberalisation policies are beneficial to the economy as a whole.

The Australian Government introduced a carbon tax from 1 July 2012. The then opposition party leader, now Prime Minister, introduced legislation to repeal the tax. Amongst the many issues being debated is that of the incidence of the tax. In this study, we explore household consumption and income changes arising from a A$23 carbon price employing a computable general equilibrium model (entitled A3E-G). The model has been calibrated using a social accounting matrix database of Australia with 10 household income groups. This carbon price generates A$6.39 billion revenue while reducing Australia's carbon emissions by 11%. The empirical evidence suggests household level impacts range from proportional to mildly progressive tax incidence. In this study, we propose four revenue recycling options to overcome any undesirable distributional effects from the carbon price. Results indicate that revenue recycling through income tax reductions and uniform lump sum transfers improves post tax income levels and welfare towards middle and high income groups. A nonuniform lump sum transferring option favors low income households. Uniform reductions in commodity tax rates are not found to be welfare improving but we find positive impacts on export competitiveness from this option.

Contracting parties to the Agreement on South Asian Free Trade Area (SAFTA) are committed to trade liberalization within a fixed time frame. Most contracting parties have kept agriculture out of their tariff liberalization commitments. A key question therefore is: should agriculture receive dispensation given the sector's important contribution to South Asia's economic structure? An enhanced multi-household framework within a multi-country computable general equilibrium (CGE) approach was used to assess the impacts on trade flows, government fiscal revenues and income distribution among households in countries that are contracting parties to SAFTA, assuming full trade liberalization and trade liberalization with the protection of the agricultural sector. The results indicate that, although both policies would facilitate economic growth and lead to a reduction in income disparity among household groups in all South Asian countries, the overall welfare gains would be greater under full trade liberalization. Hence, the removal of agricultural sector tariffs should be an important consideration in future SAFTA discussions; such a step would be a principal means for strengthening intraregional trade.

South Asia consists of seven economies (India, Sri Lanka, Pakistan, Bangladesh, the Maldives, Nepal and Bhutan) that have been recognised as the South Asian Association for Regional Cooperation (SAARC) in terms of their attempt to enhance trade and investment. Australia has been given the observer status in SAARC. Australia has experienced a significant growth in trade with South Asia in recent years. For example, India has become the 4th largest export destination for Australia in 2009. An FTA between Australia and SAARC countries would enable both Australia and South Asia to strengthen further this trade and to benefit by taking full advantage of each other's relative competitive strength. This can be achieved by removing barriers to trade and investment on a bilateral basis which impose additional costs to producers and consumers. In this paper we analyse the prospects for forming an FTA between Australia and SAARC countries. We use the Global Trade Analysis Project (GTAP) model to evaluate benefits and costs for both parties of an FTA. While the analysis mainly focuses on macroeconomic and sectoral performance under an FTA, it also highlights the potential welfare gains, trade creation and trade diversion issues that are important to policy makers.

This study focuses on economic effects of arable land fallow system and land-use change in China using a dynamic single-country, multi-regional computable general equilibrium model. Land supply is adjusted endogenously in our model. Land use in each of 31 provinces is tracked by a land-use change module, which is calibrated with satellite data. Our results reveal that the expansion of real output can be attributed to the increase in capital stock as a result of the growth of investment due to the imposition of the arable land fallow system in China. And the growth of investment is caused by the release of labor from agriculture The reduced supply of arable land in agricultural land contraction regions is partially offset by the increasing arable land in agricultural land expansion regions. Rural households benefit more than urban households from the arable land fallow policy due to relatively higher income and lower rural CPI.

Mega events such as the World Financial Crisis in 2008 have tremendous negative economic effects, particularly on tourism. This study employs recent Singaporean tourism survey data, the updated Singaporean input-output tables, and a Computable General Equilibrium (CGE) model to gauge the negative effects of the 2008 World Financial Crisis on Singapore and to simulate the effects of selected policy responses. The CGE simulation results demonstrate that at the macro level, although almost all variables are negatively affected, exports benefit greatly. At the industry level, a negative tourism shock impacts severely on the tourism-related sectors, impacts only slightly on sectors weakly linked to tourism, but tourism-competing sectors expand. In commodity market, prices and outputs decrease for most products but real household consumption and exports increase. In the labor market, low skilled workers are harshly affected, but some occupational groups benefit at the expense of others. The simulation results also suggest that, in response to an event like the 2008 World Financial Crisis, a slightly decrease in the GST rate is more effective than a significant increase in the tourism tax rate.

This chapter evaluates the economic impacts of SAFTA relative to alternative trade policies to determine which policies best deliver increased welfare to citizens, thereby helping to alleviate income disparities and poverty in the region. The study does so with a particular emphasis on the income inequality and poverty effects of trade liberalisation in South Asia on households in Sri Lanka. A static multi-country computable general equilibrium model for South Asia (SAMGEM) is formulated by incorporating a multiple household framework into the Global Trade Analysis Project (GTAP) model. A nonparametric extended representative household agent approach is used to estimate the income inequality and poverty effects of trade liberalisation in South Asia by using micro-household survey data. The findings revealed that amongst the different trade policy options considered, unilateral trade liberalisation ensures the highest welfare to all South Asian members followed by the customs union (with the exception of Sri Lanka) and the SAFTA. The poverty and income equality analysis for the Sri Lankan economy suggests that poverty is predominant in the rural and the estate sectors and Sri Lanka can achieve a significant progress towards poverty reduction as a result of implementing trade reforms.

The paper employs a computable general equilibrium (CGE) model with an environmentally-extended Social Accounting Matrix (SAM) to simulate the effects of a carbon tax of $23 per tonne of carbon dioxide on different economic agents, with and without a compensation policy. According to the simulation results, the carbon tax can cut emissions effectively, but will cause a mild economic contraction. The proposed compensation plan has little impact on emission cuts while significantly mitigating the negative effect of a carbon tax on the economy. The effect on various employment occupations is mildly negative, ranging from -0.6% to -1.7%, with production and transport workers worst affected.

This paper examines the environmental and economic effects of six (European Union, Switzerland, Norway, New Zealand, South Korea and Kazakhstan) domestic national Emissions Trading Schemes (ETSs). We have extended the analysis to an international ETS among these schemes since their governments have shown an ambition to obtain a linked market and have been carrying out negotiations for many years towards that goal. We incorporated non-CO2 emissions into the GTAP-E model database and extended the model to estimate the impact of domestic ETSs and an international ETS. Our analysis provides detailed projections regarding emissions permits allocation and emissions fluctuations. The results indicate that emissions trading volumes are very small in both domestic and international ETS scenarios since Norway, Switzerland, New Zealand and Kazakhstan economies are very small compared with the European Union and South Korea. In addition, the results in the international ETS scenario do not differ greatly from domestic trading scenario. However, results indicate that emissions abatement takes place with the lowest cost through an international ETS setting.