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Modeling the Interplay between Sanitary and Phytosanitary Measures and Tariff-rate Quotas under Partial Trade Liberalization

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  • Jayson Beckman
  • Shawn Arita

Abstract

Non-tariff measures, particularly sanitary and phytosanitary measures and tariff-rate quotas, are two critical policy barriers that impede agricultural trade. Unlike simple tariffs, both measures contain non-linear effects and binding conditions that make their treatment in modeling trade liberalization challenging. In addition, the coexistence of these measures carries important interactive effects that restrict trade. This study investigates these joint effects by developing a conceptual framework that considers different partial liberalization scenarios. Our framework points to three cases that may arise: (a) binding tariff-rate quota, non-prohibitive sanitary and phytosanitary measure; (b) non-binding tariff-rate quota, non-prohibitive sanitary and phytosanitary measure; and (c) non-binding tariff-rate quota, prohibitive sanitary and phytosanitary measure. We then use a Computable General Equilibrium model to examine partial trade liberalization scenarios for these cases, using the ongoing Transatlantic Trade and Investment Partnership negotiations as our motivation. Our simulations provide a more nuanced analysis of complex trade liberalization and demonstrate the importance of modeling the interplay between these different types of barriers.

Suggested Citation

  • Jayson Beckman & Shawn Arita, 2017. "Modeling the Interplay between Sanitary and Phytosanitary Measures and Tariff-rate Quotas under Partial Trade Liberalization," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 99(4), pages 1078-1095.
    • Handle: RePEc:oup:ajagec:v:99:y:2017:i:4:p:1078-1095.
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    File URL: http://hdl.handle.net/10.1093/ajae/aaw056
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    Citations

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    Cited by:

    1. Beckman, Jayson & Gale, Fred & Morgan, Stephen & Sabala, Ethan & Ufer, Danielle & Valcu-Lisman, Adriana & Zeng, Wendy & Arita, Shawn, 2022. "China's Import Potential for Beef, Corn, Pork, and Wheat," Amber Waves:The Economics of Food, Farming, Natural Resources, and Rural America, United States Department of Agriculture, Economic Research Service, vol. 2020(Economic ), August.
    2. Kelvin Balcombe & Dylan Bradley & Iain Fraser, 2021. "Do Consumers Really Care? An Economic Analysis of Consumer Attitudes Towards Food Produced Using Prohibited Production Methods," Journal of Agricultural Economics, Wiley Blackwell, vol. 72(2), pages 452-469, June.
    3. Beckman, Jayson & Ivanic, Maros & Jelliffe, Jeremy L & Baquedano, Felix G & Scott, Sara G, 2020. "Economic and Food Security Impacts of Agricultural Input Reduction Under the European Union Green Deal’s Farm to Fork and Biodiversity Strategies," Economic Brief 327231, United States Department of Agriculture, Economic Research Service.
    4. Otgun, Hanifi (University of Nebraska Lincoln) & Beghin, John (University of Nebraska Lincoln) & Maximiliano, Fernando (StoneX), 2023. "The Bitter Taste of Brazil’s Temporary Import Ban on Robusta Coffee," Staff Papers 338799, University of Nebraska-Lincoln, Department of Agricultural Economics.
    5. Beckman, Jayson & Gale, Fred & Lee, Tani, 2021. "Agricultural Market Access Under Tariff-Rate Quotas," Agricultural Economic Reports 308595, United States Department of Agriculture, Economic Research Service.
    6. Banda, Chikumbutso & Kalaba, Mmatlou, 2021. "The Effects of Asymmetric Regulatory Measures on North-South Trade: A Case of South African Beef Exports to the European Union," 2021 Conference, August 17-31, 2021, Virtual 315849, International Association of Agricultural Economists.
    7. Jayson Beckman & Maros Ivanic & Jeremy Jelliffe, 2022. "Market impacts of Farm to Fork: Reducing agricultural input usage," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 44(4), pages 1995-2013, December.
    8. Jafari, Yaghoob & Britz, Wolfgang & Guimbard, Houssein & Beckman, Jayson, 2021. "Properly capturing tariff rate quotas for trade policy analysis in computable general equilibrium models," Economic Modelling, Elsevier, vol. 104(C).
    9. Beckman, Jayson & Ivanic, Maros & Shaik, Saleem, 2022. "How Bilateral Trade Deals Get in the Way of Multilateral Agreements," Conference papers 333437, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    10. Ahn, Soojung & Steinbach, Sandro, 2022. "COVID-19 Trade Actions and Their Impact on the Agricultural and Food Sector," 2023 Allied Social Sciences Association (ASSA) Annual Meeting, January 6-8, 2023, New Orleans, Louisiana 316789, Agricultural and Applied Economics Association.
    11. Jayson Beckman & Maros Ivanic & Jeremy Jelliffe & Shawn Arita, 2022. "Adopt or not adopt? Mirror clauses and the European Green Deal," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 44(4), pages 2014-2033, December.
    12. Jayson Beckman & Amanda M. Countryman, 2021. "The Importance of Agriculture in the Economy: Impacts from COVID‐19," American Journal of Agricultural Economics, John Wiley & Sons, vol. 103(5), pages 1595-1611, October.
    13. Soojung Ahn & Sandro Steinbach, 2023. "The impact of COVID‐19 trade measures on agricultural and food trade," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 45(2), pages 911-927, June.
    14. Ahn, Soojung & Steinbach, Sandro, 2022. "COVID-19 Trade Actions and Their Impact on the Agricultural and Food Sector," 2022 Allied Social Sciences Association (ASSA) Annual Meeting (Virtual), January 7-9, 2022 316789, Agricultural and Applied Economics Association.
    15. Kelvin Balcombe & Dylan Bradley & Iain Fraser, 2020. "The Economic Analysis of Consumer Attitudes Towards Food Produced Using Prohibited Production Methods: Do Consumers Really Care?," Studies in Economics 2004, School of Economics, University of Kent.
    16. Adhikari, Shweta & Poudel, Dikshit & Munisamy, Gopinath, 2023. "Policy Effects on Global Palm Oil Trade: A Gravity Model Approach," 2023 Annual Meeting, July 23-25, Washington D.C. 335475, Agricultural and Applied Economics Association.

    More about this item

    Keywords

    CGE (computable general equilbrium); gravity model; agricultural trade; NTM (non-tariff measure); SPS (sanitary and phytosanitary); trade; TTIP (trans-atlantic trade and investment partnership); TRQ (tariff-rate quota);
    All these keywords.

    JEL classification:

    • Q17 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agriculture in International Trade

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