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Export taxes, world prices, and poverty in Argentina: A dynamic CGE-microsimulation analysis

  1. Martín Cicowiez  Is a corresponding author
  2. Javier Alejo  Is a corresponding author
  3. Luciano Di Gresia  Is a corresponding author
  4. Sergio Olivieri  Is a corresponding author
  5. Ana Pacheco  Is a corresponding author
  1. CEDLAS-FCE-Universidad Nacional, Argentina
  2. FCE-Universidad Nacional, Argentina
  3. World Bank, USA
Research article
Volume 9(1) Spring 2016
Cite this article as: M. Cicowiez, J. Alejo, L. Di Gresia, S. Olivieri, A. Pacheco; 2016; Export taxes, world prices, and poverty in Argentina: A dynamic CGE-microsimulation analysis; International Journal of Microsimulation; 9(1); 24-54. doi: 10.34196/ijm.00127
2 figures and 11 tables

Figures

Figure 1
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The production side.
Figure 2
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The consumption side.

Tables

Table 1
Argentina MACROSAM 2005 (percent GDP share).
Act Com Fac hhd Gov Row s-i tax TOTAL
Act 196.1 196.1
Com 111.6 60.9 12.3 25.5 20.8 231.0
Fac 82.8 82.8
hhd 79.5 9.8 −1.8 87.5
gov −1.0 28.0 27.0
row 19.4 19.4
s-i 19.1 4.9 −3.2 20.8
tax 1.8 15.5 3.2 7.5 28.0
TOTAL 196.1 231.0 82.8 87.5 27.0 19.4 20.8 28.0

  1. Source: Argentina SAM 2005.

Table 2
Sectoral factor intensities (percent).
sector VA share Labor unskilled Labor semi-skilled Labor skilled capital Nat Res TOTAL
Grains 3.7 6.0 5.3 3.8 56.9 28.0 100.0
Vegetables and fruits 1.0 22.6 19.7 14.1 15.6 28.0 100.0
Other crops 0.8 26.4 22.9 16.5 6.2 28.0 100.0
Livestock, milk and wood 2.8 20.7 18.0 12.9 20.3 28.0 100.0
Other non-agr primary 0.4 29.6 25.8 18.5 26.1 0.0 100.0
Oil 4.1 4.6 5.0 6.1 42.2 42.2 100.0
Mining 0.7 10.3 11.4 13.8 64.5 0.0 100.0
Meat 0.8 29.1 20.1 7.6 43.2 0.0 100.0
Other proc food 2.4 31.0 21.4 8.1 39.4 0.0 100.0
Vegetable oils and fats 0.3 30.5 21.1 8.0 40.5 0.0 100.0
Dairy products 0.4 38.5 26.5 10.0 25.0 0.0 100.0
Sugar 0.2 26.4 18.2 6.9 48.5 0.0 100.0
Beverages and tobacco 1.3 25.1 22.6 8.2 44.1 0.0 100.0
Textiles and apparel 1.6 27.8 18.1 6.4 47.6 0.0 100.0
Other manufacturing 3.6 24.4 23.6 8.4 43.6 0.0 100.0
Petroleum refinery 0.7 12.2 21.2 17.0 49.5 0.0 100.0
Chemical products 2.9 15.4 26.8 21.5 36.3 0.0 100.0
Mineral products 0.6 31.2 20.2 14.0 34.6 0.0 100.0
Metal products 2.5 26.6 20.7 7.7 44.9 0.0 100.0
Machinery and equipment 1.6 21.5 28.6 14.0 35.9 0.0 100.0
vehicles 1.4 21.4 25.7 15.3 37.6 0.0 100.0
services 66.2 18.3 19.5 18.5 43.7 0.0 100.0

  1. Source: Argentina SAM 2005.

  2. Notes: VA = value added; Nat Res = natural resources.

Table 3
Sectoral structure of trade structure (percent).
Sector Exports (%) (i) Imports (%) (ii) Exp.intensity (iii) Imp. Intensity (iv)
Primary
  Cereals 6.5 0.0 59.2 0.5
  Vegetables and fruit 2.3 0.3 29.8 4.7
  Oil seeds 5.4 0.5 34.0 4.2
  Other crops 0.8 0.5 9.4 4.6
  Livestock, milk and wood 0.5 0.1 1.8 0.2
  Other non-agr primary 0.1 0.2 8.3 9.2
  Mining 3.3 3.0 28.9 23.6
  oil 5.8 0.8 25.2 3.6
Processed food
  Meat 3.8 0.2 18.0 1.1
  Other proc food 5.3 1.4 15.8 4.0
  Vegetable oils and fats 16.7 0.1 87.8 4.6
  Dairy products 1.5 0.1 14.0 0.7
  Sugar 0.3 0.0 19.4 0.2
  Beverages and tobacco 1.2 0.2 7.5 1.0
Other manufactures
  Textiles and apparel 3.6 4.2 17.9 17.7
  Other manufacturing 5.8 9.0 13.8 17.5
  Petroleum refinery 8.6 2.7 38.9 14.6
  Chemical products 8.9 18.9 25.7 38.3
  Mineral products 0.5 0.9 6.1 9.6
  Metal products 7.0 7.0 21.0 18.3
  Machinery and equipment 4.1 33.6 18.6 61.3
  vehicles 7.9 16.3 41.3 55.1
  TOTAL 100.0 100.0 11.8 10.4

  1. Notes:

  2. Exports% = share of each sector in total exports.

  3. Imports% = share of each sector in total imports.

  4. EX intensity = share of exports in production.

  5. IM intensity = share of imports in consumption.

  6. Source: Argentina SAM 2005.

Table 4
CGE-microsimulations scenarios.
Name      Description
base Business as usual scenario
Policy shockx
  Etax-gsav 20% yearly cut in export tax with government savings as the equilibrating variable
  Etax-gcon 20% yearly cut in export tax with government consumption as the equilibrating variable
  Etax-dtax 20% yearly cut in export tax with direct tax rate as the equilibrating varialbe
External shockx
  Wprice-food 25% decrease in world food prices in 2008
  Wprice-oil 25% decrease in world oil prices in 2008
Table 5
Real macro indicators by simulation (annual growth rate 2007–2015).
indicator Base (LCU$) Base (chg%) Policy shocks External shocks
Etax-gsav Etax-gcon Etax-dtax Wp-food Wp-oil
Absorption 5,033 3.9 3.7 4.0 4.0 3.2 3.7
Household consumption 3,263 3.8 3.9 4.1 3.9 3.4 3.8
Government consumption 657 4.1 4.1 2.9 4.1 4.1 4.1
Fixed investment 1,114 3.9 3.1 4.4 4.2 2.2 3.4
Exports 1,365 3.8 4.0 4.4 4.3 3.7 3.8
Imports −1,041 3.8 4.1 4.6 4.5 2.7 3.5
GDP market price 5,358 3.9 3.7 4.0 4.0 3.4 3.8
GDP factor cost 4,434 3.9 3.7 4.0 4.0 3.6 3.8
Real exchange rate 1 0.1 −0.4 −0.4 −0.4 0.9 0.3

  1. Source: Author’s estimates.

Table 6
Unemployment rate by labor type in base year and final year by simulation (%).
2015 (final year)
Labor category 2005 base Etax-gsav Etax-gcon Etax-dtax Wp-food Wp-oil
Urban
  – Unskilled labor 19.1 13.8 14.2 13.9 14.0 14.2 13.8
  – Semi-skilled labor 14.6 10.6 11.0 10.7 10.8 11.0 10.6
  – Skilled labor 5.5 2.8 3.2 2.9 3.0 3.2 2.8
  – Total 15.7 10.9 11.3 11.0 11.1 11.3 10.9
Rural
  – Unskilled labor 13.1 7.4 7.5 7.0 7.2 10.1 7.4
  – Semi-skilled labor 10.0 6.4 6.5 6.0 6.2 9.1 6.4
  – Skilled labor 3.8 2.5 2.5 2.5 2.5 5.0 2.5
  – Total 10.7 6.2 6.3 5.9 6.1 8.9 6.2
National
  – Unskilled labor 18.5 13.2 13.6 13.3 13.3 13.9 13.2
  – Semi-skilled labor 14.4 10.4 10.8 10.5 10.6 10.9 10.4
  – Skilled labor 5.4 2.8 3.2 2.9 2.9 3.3 2.8
  – Total 15.3 10.5 10.9 10.6 10.7 11.1 10.5

  1. Source: Author’s estimates.

Table 7
Fiscal indicators.
2015 (final year)
Labor category 2005 base Etax-gsav Etax-gcon Etax-dtax Wp-food Wp-oil
Gov consumption (share GDP) 12.3 12.3 12.4 11.0 12.2 12.9 12.4
Gov savings (share GDP) 4.9 4.9 3.2 4.9 4.9 3.5 4.3
Tax revenue(share GDP) 28.0 28.0 26.6 26.7 27.9 27.8 27.8
  – Export tax 2.3 2.1 0.4 0.4 0.4 1.7 2.0
  – Tariffs 0.7 0.8 0.7 0.8 0.8 0.8 0.8
  – Value added tax 6.9 6.9 6.9 6.9 6.9 6.9 6.8
  – Other indirect taxes 7.3 7.4 7.6 7.6 7.6 7.5 7.2
  – Direct taxes 10.8 10.9 11.0 11.0 12.2 10.9 10.9

  1. Source: Author’s estimates.

Table 8
Sectoral results by simulation (annual growth rate 2007–2015).
Indicator Base (LCU$) Base (chg %) Policy shocks External shocks
Etax-gsav Etax-gcon Etax-dtax Wp-food Wp-oil
GDP primary 596 2.9 3.1 3.3 3.3 1.9 2.6
GDP non-primary 3,837 4.1 3.8 4.1 4.1 3.8 4.0
Exports primary 320 2.1 4.5 4.7 4.8 1.2 2.1
Imports primary 47 4.3 6.2 6.6 6.5 3.4 3.9
Exports non-primary 1,045 4.2 3.9 4.3 4.2 4.3 4.2
Imports non-primary 994 3.7 4.0 4.5 4.4 2.6 3.5

  1. Source: Author’s estimates.

Table 9
Microsimulation results – changes in poverty (*) Official moderate poverty rate (change in percentage points).
Policy shocks External shocks
Microsimulation effect Etax-gsav Etax-gcon Etax-dtax Wp-food Wp-oil
Pop 0.05 0.00 0.01 0.06 0.00
Pop + act −0.05 0.00 −0.02 −0.03 0.01
Pop+ act + uerat 0.03 0.06 −0.01 0.06 0.01
Pop + act + uerat + sec −0.01 −0.03 0.07 −0.04 0.00
Pop + act + uerat + sec + w1 0.04 −0.05 0.00 0.05 −0.08
Pop + act + uerat + sec + w1 + w2 0.59 0.10 0.20 0.68 0.08
Pop + act + uerat + sec + w1 + w2 + cap 0.00 −0.02 −0.01 0.04 0.00
Pop + act + uerat + sec + w1 + w2 + cap + pl 1.16 1.62 1.42 −3.91 0.20
TOTAL 1.81 1.68 1.66 −3.09 0.23

  1. Source: Author’s estimates.

  2. (*)

    other poverty indicators are available from the authors upon request.

  3. Notes: pop = population; act = participation rate; uerat = unemployment rate; sec = sector structure employment; w1 = relative wages; w2 = average wage; cap = non-labor incomes; pl=poverty line.

Table A2
Export tax rates and tariffs rates (%).
Export tax Tariffs
Sector (i) (ii)
Primary
  Cereals 14.5 2.4
  Vegetables and fruits 7.3 3.6
  Oil seeds 20.0 2.3
  Other crops 7.3 2.8
  Livestock, milk and wool 10.9 1.9
  Other non agr primary 3.6 1.5
  Mining 3.6 0.4
  oil 32.7
Processed food
  Meat 10.9 4.0
  Other proc food 3.6 4.8
  Vegetable oils and fats 17.4 3.8
  Dairy products 3.6 5.6
  Sugar 3.6 6.7
  Beverages and tobacco 3.6 7.0
Other manufactures
  Textiles and apparel 3.6 6.4
  Other manufacturing 3.6 5.2
  Petroleum refinery 3.6 0.1
  Chemical products 3.6 2.8
  Mineral products 3.6 4.2
  Metal products 3.6 4.2
  Machinery and equipment 3.6 4.7
  vehicules 3.6 9.0

  1. Source: Argentina SAM 2005.

Table A2
Real macro indicators by simulation and year (growth rate).
Indicator Scenario 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Absorption base 5,033 8.0 7.9 6.5 4.0 3.5 3.5 3.5 3.5 3.5 3.4
Household consumption base 3,263 8.0 8.0 6.4 3.9 3.4 3.4 3.4 3.4 3.4 3.4
Government consumption base 657 8.1 7.9 6.9 4.2 3.7 3.7 3.6 3.6 3.6 3.6
Fixed investment base 1,114 7.9 7.8 6.6 4.0 3.5 3.5 3.5 3.5 3.5 3.5
Exports base 1,365 7.8 7.7 6.5 3.8 3.3 3.3 3.3 3.3 3.3 3.3
Imports base −1,041 7.8 7.7 6.5 3.8 3.3 3.3 3.3 3.3 3.3 3.3
GDP market price base 5,358 8.0 7.9 6.5 4.0 3.5 3.5 3.5 3.4 3.4 3.4
GDP factor cost base 4,434 8.0 8.0 6.5 4.0 3.5 3.5 3.5 3.5 3.5 3.5
Real exchange rate base 1 0.2 0.5 −0.3 0.1 0.1 0.2 0.2 0.2 0.2 0.1
Absorption etax-gsav 5,033 8.0 7.9 6.6 3.9 3.4 3.3 3.2 3.2 3.2 3.2
Household consumption etax-gsav 3,263 8.0 8.0 6.8 4.2 3.6 3.5 3.4 3.3 3.3 3.2
Government consumption etax-gsav 657 8.1 7.9 6.9 4.2 3.7 3.7 3.6 3.6 3.6 3.6
Fixed investment etax-gsav 1,114 7.9 7.8 5.8 3.1 2.6 2.6 2.6 2.6 2.6 2.7
Exports etax-gsav 1,365 7.8 7.7 7.2 4.3 3.7 3.6 3.5 3.4 3.3 3.3
Imports etax-gsav −1,041 7.8 7.7 7.4 4.5 3.8 3.7 3.5 3.4 3.3 3.3
GDP market price etax-gsav 5,358 8.0 7.9 6.6 3.9 3.4 3.3 3.3 3.2 3.2 3.2
GDP factor cost etax-gsav 4,434 8.0 8.0 6.4 3.9 3.3 3.3 3.3 3.2 3.2 3.2
Real exchange rate etax-gsav 1 0.2 0.5 −1.1 −0.6 −0.5 −0.4 −0.3 −0.3 −0.2 −0.2
Absorption etax-gcon 5,033 8.0 7.9 6.6 4.1 3.6 3.6 3.6 3.6 3.6 3.6
Household consumption etax-gcon 3,263 8.0 8.0 6.8 4.3 3.8 3.7 3.7 3.6 3.6 3.6
Government consumption etax-gcon 657 8.1 7.9 4.4 2.1 2.0 2.3 2.7 2.9 3.1 3.3
Fixed investment etax-gcon 1,114 7.9 7.8 7.3 4.6 4.0 4.0 3.9 3.8 3.8 3.8
Exports etax-gcon 1,365 7.8 7.7 7.4 4.6 4.0 4.0 3.9 3.8 3.8 3.7
Imports etax-gcon −1,041 7.8 7.7 7.6 4.8 4.2 4.1 4.0 4.0 3.9 3.8
GDP market price etax-gcon 5,358 8.0 7.9 6.6 4.1 3.6 3.6 3.6 3.6 3.6 3.6
GDP factor cost etax-gcon 4,434 8.0 8.0 6.5 4.0 3.6 3.6 3.6 3.6 3.6 3.6
Real exchange rate etax-gcon 1 0.2 0.5 −1.0 −0.5 −0.5 −0.4 −0.3 −0.3 −0.2 −0.2
Absorption etax-dtax 5,033 8.0 7.9 6.6 4.1 3.6 3.6 3.5 3.5 3.5 3.5
Household consumption etax-dtax 3,263 8.0 8.0 6.4 4.0 3.5 3.5 3.5 3.5 3.5 3.5
Government consumption etax-dtax 657 8.1 7.9 6.9 4.2 3.7 3.7 3.6 3.6 3.6 3.6
Fixed investment etax-dtax 1,114 7.9 7.8 7.0 4.3 3.8 3.7 3.7 3.7 3.7 3.6
Exports etax-dtax 1,365 7.8 7.7 7.3 4.5 3.9 3.9 3.8 3.7 3.7 3.6
Imports etax-dtax −1,041 7.8 7.7 7.5 4.7 4.1 4.0 3.9 3.9 3.8 3.7
GDP market price etax-dtax 5,358 8.0 7.9 6.6 4.1 3.5 3.5 3.5 3.5 3.5 3.5
GDP factor cost etax-dtax 4,434 8.0 8.0 6.5 4.0 3.5 3.5 3.5 3.5 3.5 3.5
Real exchange rate etax-dtax 1 0.2 0.5 −1.1 −0.6 −0.5 −0.4 −0.3 −0.3 −0.2 −0.2
Absorption wp-food 5,033 8.0 7.9 4.1 3.5 3.0 3.0 3.0 3.0 3.0 3.1
Household consumption wp-food 3,263 8.0 8.0 5.2 3.5 3.0 3.1 3.1 3.1 3.1 3.1
Government consumption wp-food 657 8.1 7.9 6.9 4.2 3.7 3.7 3.6 3.6 3.6 3.6
Fixed investment wp-food 1,114 7.9 7.8 −0.6 2.9 2.4 2.5 2.5 2.5 2.5 2.6
Exports wp-food 1,365 7.8 7.7 10.0 3.1 2.6 2.7 2.7 2.7 2.8 2.8
Imports wp-food −1,041 7.8 7.7 1.0 3.3 2.8 2.8 2.8 2.9 2.9 2.9
GDP market price wp-food 5,358 8.0 7.9 6.2 3.4 2.9 3.0 3.0 3.0 3.0 3.0
GDP factor cost wp-food 4,434 8.0 8.0 6.8 3.5 3.0 3.0 3.0 3.1 3.1 3.1
Real exchange rate wp-food 1 0.2 0.5 7.3 0.1 0.1 0.1 0.1 0.1 0.1 0.1
Absorption wp-oil 5,033 8.0 7.9 5.9 3.8 3.3 3.3 3.3 3.3 3.3 3.3
Household consumption wp-oil 3,263 8.0 8.0 6.4 3.8 3.3 3.3 3.3 3.3 3.3 3.3
Government consumption wp-oil 657 8.1 7.9 6.9 4.2 3.7 3.7 3.6 3.6 3.6 3.6
Fixed investment wp-oil 1,114 7.9 7.8 4.1 3.7 3.2 3.2 3.2 3.2 3.2 3.3
Exports wp-oil 1,365 7.8 7.7 8.0 3.6 3.1 3.1 3.1 3.1 3.1 3.1
Imports wp-oil −1,041 7.8 7.7 5.2 3.7 3.2 3.2 3.2 3.2 3.2 3.2
GDP market price wp-oil 5,358 8.0 7.9 6.6 3.8 3.3 3.3 3.3 3.3 3.3 3.3
GDP factor cost wp-oil 4,434 8.0 8.0 6.6 3.8 3.3 3.3 3.4 3.4 3.4 3.4
Real exchange rate wp-oil 1 0.2 0.5 1.7 0.1 0.1 0.1 0.1 0.1 0.1 0.1

  1. Source: Author’s estimates.

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