Table 1: Macroeconomic SAM, 2004 <u>(billions</u> of lempiras)

||acts|coms|facts|hhld|govnt|row|tax|tar|invst|total|
|---|---|---|---|---|---|---|---|---|---|---|
|acts||260.5||||||||260.5|
|coms|137.2|||116.0|16.7|57.3|||35.6|362.8|
|facts|120.5|||||||||120.5|
|hhld|||120.5||1.4|27.6||||149.5|
|govnt|||||||17.3|4.1||21.4|
|row||89.9||2.2||||||92.1|
|tax|2.8|8.3||6.3||||||17.4|
|tar||4.1||||||||4.1|
|invst||||25.1|3.3|7.2||||35.6|
|total|260.5|362.8|120.5|149.6|21.4|92.1|17.3|4.1|35.6||

_<u>Note:</u>_ <u>The SAM abbreviations stand for the following, from left to right and from top to</u> bottom: activities, commodities, factors, households, government, rest of the world, taxes, import tariffs, and saving-investment. Row totals may differ from column totals due to rounding. _Source:_ Author’s calculations based on IFS, GFS, and BoP data.

in services. We maintain the sectoral disaggregation of Cuesta (2004) for activities/commodities in agriculture, manufacturing, and natural resources (see Table 13 in the Appendix). Since a detailed disaggregation of service sectors is not particularly relevant for the analysis of trade reform scenarios, we aggregate the service sectors into four groups.

Total value added is split into labor and capital components using the shares from Cuesta (2004), who estimates that payments to capital (combined with land, and natural resources) are approximately 28 percent of total value added. Capital payments by sector are calculated in a similar fashion, using the data from Cuesta (2004). In order to decompose labor value added by skill level and sector of employment, we combine information from the 2004 EPHPM and Cuesta (2004). We define unskilled workers as those who completed less than a full cycle of secondary school, skilled workers as having a high school diploma, and tertiary-skilled workers as those with at least some education beyond secondary school. The distribution of labor income in EPHPM across these three skill (education) categories as well as across four broad sectors—agriculture, manufacturing, private services, and public services—is then used to decompose split labor value added. Although the survey allows workers to report nine different sectors of employment, most of the detail is in services, which receive a fairly aggregate treatment in our micro-SAM. Therefore, the only source of the required information is Cuesta (2004), and we split the value added in agriculture, manufacturing, and private services according to the shares calculated from his SAM. It was not possible to use the Cuesta (2004) shares directly (i.e., without calculating the survey shares first) because doing so would make the SAM distribution of value added completely inconsistent with the national accounts.

In order to disaggregate total imports and exports by trading partner and commodity, we use the data from the UN COMTRADE database. For each trading partner, import and export data were obtained at the 2-digit SITC (Standard International Trade Classification) level and then aggregated up to the level of detail of the micro-SAM. Rest-of-world values were obtained as the difference between exports and imports to all trading partners and those to the US, EU, and rest of DR-CAFTA. Tariff data were obtained from UN TRAINS as trade-weighted average tariffs at the same 2-digit SITC level. Data were also collected on import tariffs in Honduras’ trading partners; 5