MPIA-20030 Resource allocation across industrial sectors, poverty and income inequality in Ethiopia: CGE modelling approach


This study investigates the likely impact of systematic resource allocation on different sectors on the Ethiopian economy, income inequality and poverty status of households. We are going to use a 2012 Ethiopian Social Accounting Matrix and 2010 Household Income and Expenditure data. A standard single country STAGE Computable General Equilibrium model will be used. Two different simulations will be considered in this study. The first scenario will be increasing the efficiency of priority industrial activities while protecting them and liberalizing the other commodities. The second option will be increasing the efficiency of the leading labor intensive industrial activities and liberalizing the economy while protecting the labor intensive industries. Such policies options will have a different impact on the welfare, GDP, an average income of households and production of main activities of the economy. The study extends to examine the possible effect of such policy on poverty and income inequality. The study uses an innovative approach to treating group heterogeneity by using arithmetic progression and linear combination of the average growth rates of income of poor and none poor households. The finding will be used as a policy input to identify sectors where resources should be allocated in abundance.


Project leader: Zerayehu Eshete

Project researchers: Solomon Tsehay Feleke | ALEMNESH GEBRESELASSIE | Asmayit Tekeste

Scientific mentors: Lulit Mitik Beyene

Journal publication

No journal publications.

Working Papers

Title Modified Size Comments Recommendations
Resource Allocation across Industrial Sectors, Growth, Poverty, and Income Inequality in Ethiopia: A Macro-Micro Approach 2019-06-20 1.20MB 0 0

Policy Briefs

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Industrial parks as engines for economic growth in Ethiopia 2019-07-30 619.11kB 0 0

Final report

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2018-11-02 952.25kB 0 0


Title Modified Size Comments Recommendations
2017-09-21 351.19kB 0 0

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