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The Doha Talks and the Bargaining Surplus in Agriculture

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  • Furtan, William Hartley
  • Guzel, A.
  • Karantininis, Kostas

Abstract

The Doha Round has been slow to achieve a reduction in the level of agricultural protection. This remains the case notwithstanding the substantial economic benefits that would arise from a more liberal agricultural trading regime. We provide one explanation for this slowness using a simple bargaining model. We demonstrate that the bargaining countries received a substantial fiscal gain from reducing government expenditures in the run-up to the Uruguay Round. This fiscal pressure was sufficient to block rent seekers who wanted farm payments to continue. Since the Uruguay Round these fiscal constraints have been reduced and the same pressure to reach a bargain and control rent-seeking behaviour is not present in the Doha Round.

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Bibliographic Info

Article provided by Estey Centre for Law and Economics in International Trade in its journal Estey Centre Journal of International Law and Trade Policy.

Volume (Year): 08 (2007)
Issue (Month): 2 ()
Pages:

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Handle: RePEc:ags:ecjilt:7706

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Related research

Keywords: Doha Round; rent seeking; bargaining; International Relations/Trade;

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  1. Carsten Daugbjerg & Alan Swinbank, 2007. "The Politics of CAP Reform: Trade Negotiations, Institutional Settings and Blame Avoidance," Journal of Common Market Studies, Wiley Blackwell, vol. 45, pages 1-22, 03.
  2. Peter Nedergaard, 2006. "Market Failures and Government Failures: A Theoretical Model of the Common Agricultural Policy," Public Choice, Springer, vol. 127(3), pages 385-405, June.
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