Niimi, YokoBussolo, Maurizio2012-03-302012-03-302009World Development0305750Xhttps://hdl.handle.net/10986/5475This paper provides an ex-ante assessment of the poverty and income distribution impacts of the Central American Free Trade Area agreement on Nicaragua. A general equilibrium macro model is used to simulate trade reform scenarios and estimate their price effects, while a micro module maps these price changes into real income changes at the individual household level. The final impact on poverty is not too large, but its dispersion across households is significant and should be considered when designing compensatory policies. A main policy message is that Nicaragua should consider enlarging its own liberalization to countries other than the United States to boost trade-induced poverty reductions.ENPersonal Income, Wealth, and Their Distributions D310Economic Integration F150Trade and Labor Market Interactions F160Measurement and Analysis of Poverty I320Economic Development: Human ResourcesHuman DevelopmentIncome DistributionMigration O150International Linkages to DevelopmentRole of International Organizations O190Development Planning and Policy: Trade PolicyFactor MovementForeign Exchange Policy O240Journal ArticleWorld Bank