The authors wish to thank participants at the CESifo 2009 Global Economy conference and at the ETSG 2009 meeting for valuable comments and suggestions. Financial support from the Danish Social Science Research Council is gratefully acknowledged.
Reducing Tariffs According to WTO Accession Rules: The Case of Vietnam
Version of Record online: 16 APR 2012
© 2012 Blackwell Publishing Ltd
Review of Development Economics
Volume 16, Issue 2, pages 331–341, May 2012
How to Cite
Fosse, H. B. and Raimondos-Møller, P. (2012), Reducing Tariffs According to WTO Accession Rules: The Case of Vietnam. Review of Development Economics, 16: 331–341. doi: 10.1111/j.1467-9361.2012.00665.x
- Issue online: 16 APR 2012
- Version of Record online: 16 APR 2012
When Vietnam joined the World Trade Organization (WTO) in 2007 it was granted an accession period up to 2014. During this period tariffs would have to fall according to the accession agreement. This paper evaluates this 2007–2014 trade liberalization by building an applied general equilibrium model and calibrating it to the Vietnamese data. The model pays careful attention to the fact that Vietnam has many state-owned enterprises. The model simulations show that the WTO tariff reductions will reduce overall welfare. Moreover, the biggest loss will take place among the poor rural households in Vietnam. This paper proposes other tariff reforms that will both raise overall welfare and reduce income inequality.