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Border Price Changes and Domestic Welfare in the Presence of Subsidised Exports

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  • Tyers, Rod
  • Falvey, Rod

Abstract

Export subsidies have been prominent in the recent trade dispute between the United States and the European Community. Implicit in this dispute is the notion that each party expects to gain from unilateral liberalization by the other. In this paper, it is first established analytically that increases in export prices can have ambiguous net welfare effects when at least some exports are subsidized. It is shown that the extent to which border price changes are transmitted to domestic markets is a key determinant of the direction and magnitude of net welfare effects. Copyright 1989 by Royal Economic Society.

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Bibliographic Info

Article provided by Oxford University Press in its journal Oxford Economic Papers.

Volume (Year): 41 (1989)
Issue (Month): 2 (April)
Pages: 434-51

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Handle: RePEc:oup:oxecpp:v:41:y:1989:i:2:p:434-51

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Cited by:
  1. Salazar P. Brandao, Antonio & Martin, Will, 1993. "Implications of agricultural trade liberalization for the developing countries," Policy Research Working Paper Series 1116, The World Bank.
  2. James E. Anderson, 1997. "The Uruguay Round and Welfare in Some Distorted Agricultural Economies," Boston College Working Papers in Economics 360, Boston College Department of Economics.
  3. Ingco, Merlinda D., 1997. "Has agricultural trade liberalization improved welfare in the least-developed countries? Yes," Policy Research Working Paper Series 1748, The World Bank.

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