Kinnunen, JoukoLofgren, HansSulla, VictorMerotto, Dino2013-04-112013-04-112013-02https://hdl.handle.net/10986/13168The economy of Moldova, which has one of the lowest levels of gross national income per capita in the World Bank Europe and Central Asia region, is strongly linked to the outside world, especially to the neighboring countries of the European Union and the Commonwealth of Independent States. This paper analyzes a set of scenarios for Moldova up to 2020, defined to shed light on issues related to an alternative future dominated by goods and services exports as opposed to today's reliance on worker remittances. The analysis is based on a Moldovan version of MAMS (Maquette for Millennium Development Goal Simulations), a CGE (Computable General Equilibrium) model for country strategy analysis. In sum, the impact of increased export demand and productivity growth is more positive when these shocks are directed to manufacturing, a sector more heavily linked to international trade, compared with agriculture. Increased productivity in transport and communications generates faster growth with widely diffused benefits, reaching households in a relatively equitable manner compared with foreign trade-induced growth. A comparison between adverse shocks in two areas, higher energy import prices, and lower remittances, designed to have similar effects on gross domestic product, suggests that a remittance shock leads to less of a poverty increase, related to the fact that remittance-receiving households are not highly vulnerable; among sectors, agriculture is most vulnerable due to heavy energy reliance. Finally, well-targeted transfer schemes may offer an effective tool for diffusing the benefits of economic growth to the whole population, perhaps also contributing to more general acceptance of structural change.en-USCC BY 3.0 IGOACCOUNTINGACCUMULATION OF CAPITALADVERSE SHOCKSAGRICULTUREANNUAL GROWTHASSETSBALANCE OF PAYMENTSBASE YEARBRAIN DRAINBUDGET CONSTRAINTBUDGET CONSTRAINTSCAPITAL ACCOUNTSCAPITAL GAINSCAPITAL STOCKSCOMMODITIESCOMMODITYCOMMODITY MARKETSCOMMUNICATION TECHNOLOGIESCOMPARATIVE ADVANTAGECOMPETITIVENESSCONSUMPTION DECISIONSCONSUMPTION LEVELSCOUNTRY DEVELOPMENTCRISESCURRENT ACCOUNTCURRENT ACCOUNTSDEBTDEMAND CURVEDEMAND CURVESDEMOGRAPHICDEPRECIATIONDEVELOPING COUNTRIESDEVELOPING COUNTRYDEVELOPMENT ECONOMICSDEVELOPMENT POLICYDEVELOPMENT STRATEGYDIRECT INVESTMENTDISPOSABLE INCOMEDOMESTIC BORROWINGDOMESTIC DEMANDDOMESTIC DEMANDSDOMESTIC MARKETDOMESTIC MARKETSDOMESTIC PRICEDOMESTIC PRICE LEVELSDOMESTIC PRICESECONOMIC CRISISECONOMIC DEVELOPMENTECONOMIC DOWNTURNECONOMIC POLICIESECONOMIC POLICYECONOMIC RESEARCHECONOMIC SECTORSECONOMIC STRUCTUREECONOMIC TRANSACTIONSELASTICITYELASTICITY OF SUBSTITUTIONEMPLOYMENT GROWTHEQUILIBRIUMEQUILIBRIUM PRICESEQUIPMENTEXCHANGE RATEEXPENDITUREEXPENDITURESEXPORT MARKETSEXPORT SHAREEXPORT VOLUMESEXPORTSEXTERNAL SHOCKSEXTERNAL TRADEFACTOR DEMANDFACTOR MARKETSFINANCIAL CRISISFINANCIAL FLOWSFINANCIAL INTERMEDIATIONFISCAL POLICYFIXED CAPITALFIXED INVESTMENTFOREIGN CURRENCYFOREIGN DEBTFOREIGN DEBTSFOREIGN EXCHANGEFOREIGN GOVERNMENTFOREIGN INTERESTFOREIGN INTERESTSFOREIGN MARKETSFOREIGN TRADEFREE TRADEFREE TRADE AGREEMENTFULL EMPLOYMENTFUNCTIONAL FORMSFUTURE GROWTHGDPGENERAL EQUILIBRIUMGINI COEFFICIENTGOVERNMENT ACCOUNTSGOVERNMENT BUDGETGOVERNMENT DEBTGOVERNMENT DEBTSGOVERNMENT INVESTMENTGOVERNMENT POLICYGOVERNMENT REVENUESGOVERNMENT SPENDINGGOVERNMENT SUBSIDIESGROSS DOMESTIC PRODUCTGROSS FIXED CAPITAL FORMATIONGROSS NATIONAL INCOMEGROSS NATIONAL SAVINGSGROWTH RATEGROWTH RATESHOME MARKETHOUSEHOLD INCOMEHOUSEHOLD INCOMESHOUSEHOLD SAVINGSIMPACT OF SHOCKSIMPORTIMPORT PRICESIMPORTSINCOMEINCOME GROWTHINCOME INEQUALITYINCOME TAXINCOME TAXESINFORMATION TECHNOLOGYINFRASTRUCTURE INVESTMENTSINTEREST PAYMENTSINTERNATIONAL BANKINTERNATIONAL DEVELOPMENTINTERNATIONAL PRICESINTERNATIONAL TRADEINVESTMENT DEMANDSINVESTMENT FINANCINGINVESTMENT SPENDINGLABOR FORCELABOR FORCE GROWTHLABOR FORCE PARTICIPATIONLABOR MARKETLABOR MARKETSLABOR PRODUCTIVITYMANUFACTURING INDUSTRYMARKET ACCESSMARKET PRICESMARKET SHAREMIDDLE-INCOME COUNTRIESMOBILE PHONEMOBILE PHONESMONETARY FUNDNATIONAL INCOMEOUTPUTOUTPUTSPENSIONSPERSONAL INCOMEPOLICY RESPONSESPOVERTY REDUCTIONPRICE CHANGESPRICE ELASTICITYPRICE LEVELSPRIVATE CAPITALPRIVATE CONSUMPTIONPRIVATE INVESTMENTPRIVATE SAVINGSPRODUCTIVITYPRODUCTIVITY GROWTHPRODUCTIVITY INCREASESPROFIT MAXIMIZATIONPUBLIC INVESTMENTRAPID ECONOMIC GROWTHRAPID GROWTHREAL ESTATEREAL EXCHANGE RATEREAL GROWTH RATESREAL WAGESREGULATORY ENVIRONMENTRELATIVE PRICESREMITTANCEREMITTANCESRETURNSAVINGSSAVINGS RATESMALL COUNTRYSOCIAL BENEFITSSOCIAL PROTECTIONSTOCK CHANGESTRONG DEMANDSTRUCTURAL CHANGESUPPLIERSSUPPLY CURVESUPPLY CURVESSUPPLY SIDESURPLUSSUSTAINABLE DEVELOPMENTTAXTAX CODETAX POLICYTAX RATESTAX REVENUESTELECOMMUNICATIONSTELEPHONE LINESTOTAL EXPORTSTOTAL FACTOR PRODUCTIVITYTOTAL REVENUETRADE BARRIERSTRADE DEFICITTRADE STATISTICSTRADINGTRADING PARTNERSTRANSACTIONTRANSACTION COSTSTRUST FUNDUNCERTAINTIESUNCERTAINTYUNEMPLOYEDUNEMPLOYMENTUNEMPLOYMENT RATEUNSKILLED LABORUPWARD PRESSUREVALUE ADDEDVOLATILITYWAGE GROWTHWAGE INCREASESWAGESWORLD DEVELOPMENT INDICATORSWORLD MARKETWORLD MARKETSWORLD PRICESWorld Bank10.1596/1813-9450-6365