Impact of Money Transfer Pricing on Beneficiaries: an Approach Based on the Dynamic Computable General Equilibrium Model

Abstract

Abstract Achieving the 2030 Agenda of the Sustainable Development Goals is all about eradicating poverty, reducing economic inequality and putting the world on a more sustainable path. As such, the SDGs give us one of the steps to take by reducing tariffs on remittances. Therefore, the overall objective of this study is to assess the future consequences on the income distribution of households in particular and the economy in general as a result of lowering tariffs on remittances. To do so, the methodology chosen is based on the construction of a dynamic computable general equilibrium model (MEGC). The data required for the modelling are taken from the Social accounting matrix (SAM) constructed from the national accounts for the year 2013. The results of the various simulations carried out show, on the one hand, the negative macroeconomic consequences of a tax on remittances on the Ivorian economy and, on the other hand, the simulations of prices on remittances showed an increase in the sums received by the beneficiaries, as well as a significant increase in their well-being and a significant contribution to reducing poverty and inequality in the order of 1.8% and 17% on average per year. JEL Classification: C68, D31, D58, I32, R20.