Structural Model for the Analysis of ‘The Impacts of Import Tariff Changes on Domestic Industrial Production’ in Nigeria (Published)
This study has investigated the ability of import tariff changes to match the relationship between import tariff changes and domestic industrial production in Nigeria. The study used a Static Computable General Equilibrium model of an archetype country to run simulations that indicate the nature of the static effects of import tariff changes on Nigeria. This study identifies four different scenarios to investigate the impacts of the changes in the import tariff rates on domestic industrial production in Nigeria. Scenarios try to get macroeconomic and welfare variables changes after the tariff rate changes compared to the base case scenario 2019 in which the benchmark equilibrium parameters are calibrated. The results shows that the growth of domestic industrial production have direct relationships with import tariff changes. That is, import tariff increase will provide increases in domestic industrial production. On the basis of our findings, this study recommends that, economic policies aiming to establish a level of import substitution seems to be more favourable in Nigeria, therefore, they should be encouraged. Also, a coordinated interplay of monetary and fiscal policies will be required to minimise contemporaneous distortions that arise from trade restrictions.
Keywords: CGE model, Nigeria, domestic industrial production, tariff changes
Implications of Import Tariff Changes on Household Welfare in Nigeria: A CGE Model Approach (Published)
This study investigated the effects of import tariff changes on the household welfare in Nigeria. Methodologically, the study used a static CGE model to run simulations that indicate the nature of the static effects. In the simulations, the study identifies four different scenarios to investigate the impacts of the changes in the import tariff rates. Scenario 1 & 2 focus on tariff rates reductions, whiles scenarios 3 & 4 test the effects of the increase in import tariff rates on household welfare and compared to the base case scenario 2019 in which the benchmark equilibrium parameters are calibrated. The results show that household income and consumption volume have inverse relationships with import tariff changes. The findings obtained from the model suggest that import tariff increase will provide rise in general price level. But household welfare should be a priority of government complementary policy help, therefore social protection policy should put in place for any upward rise of tariff rate.
Keywords: CGE model, Nigeria, household welfare, tariff changes