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The effects on intraregional agricultural trade of ending NAFTA's market access provisions

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  • Jayson Beckman
  • Steven Zahniser

Abstract

This paper explores the possible effects on agriculture of ending the market access provisions of the North American Free Trade Agreement (NAFTA). This paper considers two hypothetical scenarios: one revolving around a fallback to most‐favored‐nation (MFN) tariff rates and the other considering the additional effect of increased transaction costs in intraregional trade. Results from a computable general equilibrium model indicate that applying MFN tariff rates to U.S.–Canada and U.S.–Mexico agricultural trade would lead to a 14.43% reduction in these trade flows, while a scenario also featuring higher transaction costs would bring an even larger reduction (21.25%). In both scenarios, almost every agricultural product experiences a reduction in bilateral trade, with U.S. agricultural exports to Mexico undergoing some of the largest proportionate decreases. Many sectors within North American agriculture would have lower output, including fruit and nuts, vegetables, oilseeds and vegetable oils, and processed foods in Canada; fruit, vegetables, and beef in Mexico; and poultry meat, pork, beef, and dairy products in the United States. Cet article explore les effets possibles sur l'agriculture de la fin des dispositions relatives à l'accès aux marchés de l'Accord de libre‐échange nord‐américain (ALENA). L'article examine deux scénarios hypothétiques: l'un s'articule autour d'un repli sur les taux de droits de la nation la plus favorisée (NPF) et l'autre, prend en compte l'effet supplémentaire de l'augmentation des coûts de transaction dans les échanges intrarégionaux. Les résultats d'un modèle d’équilibre général calculable indiquent que l'application des taux de droits NPF au commerce agricole États‐Unis‐Canada et États‐Unis‐Mexique entraînerait une réduction de 14,43% des flux commerciaux, tandis qu'un scénario comportant des coûts de transaction plus élevés indique une réduction des flux commerciaux encore plus grande de 21,25%. Dans les deux scénarios, presque tous les produits agricoles subissent une réduction des échanges bilatéraux, avec les exportations agricoles américaines vers le Mexique subissant parmi les réductions proportionnelles les plus grandes. Plusieurs secteurs de l'agriculture nord‐américaine produiraient moins avec l'abandon de l'ALENA, incluant les secteurs des fruits, des noix, des légumes, des oléagineux, les huiles végétales et les aliments transformés au Canada; Les secteurs des fruits, des légumes et du bœuf au Mexique; et les secteurs de la viande de volaille, du porc, du bœuf et des produits laitiers aux États‐Unis.

Suggested Citation

  • Jayson Beckman & Steven Zahniser, 2018. "The effects on intraregional agricultural trade of ending NAFTA's market access provisions," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 66(4), pages 599-612, December.
  • Handle: RePEc:bla:canjag:v:66:y:2018:i:4:p:599-612
    DOI: 10.1111/cjag.12188
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    References listed on IDEAS

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    2. Ziming Bai & Chenyang Liu & Hongye Wang & Cuixia Li, 2023. "Evolution Characteristics and Influencing Factors of Global Dairy Trade," Sustainability, MDPI, vol. 15(2), pages 1-20, January.

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