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Agricultural Interest Groups and the North American Free Trade Agreement

In: The Political Economy of American Trade Policy

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  • David Orden

Abstract

This paper evaluates the influence of diverse U.S. agricultural interest groups on the North American Free Trade Agreement (NAFTA). Under NAFTA, licenses and quotas that restricted agricultural trade between Mexico and the United States were converted to tariffs in January 1994 and all tariffs are to be phased out over adjustment periods of up to 15 years. The agricultural provisions of the 1988 Canada-U.S. FTA, which left quantitative barriers intact for dairy, poultry and other sectors, remain in effect for bilateral Canadian- U.S. trade. NAFTA received support from export-oriented U.S. producers of most grains, oilseeds, livestock, and some horticultural products. Opposition was expressed by wheat producers, seeking leverage on Canadian export-pricing issues, and protected sugar, peanut, and winter fruit and vegetable producers. The opposition was not addressed in the side agreements negotiated by the Clinton administration but the agricultural commodity groups were able to bargain for accommodations in the subsequent legislative debate. Final concessions protect U.S. sugar from Mexican competition, provide some transition protection to winter fruits and vegetables, and ensnarl the United States in disputes about Canadian exports of wheat and peanut butter. With these concessions, NAFTA results in essentially no reform of entrenched domestic agricultural support programs in the United States (or Canada) during the lengthy tariff phase-out periods.

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This chapter was published in:

  • Anne O. Krueger, 1996. "The Political Economy of American Trade Policy," NBER Books, National Bureau of Economic Research, Inc, number krue96-1.
    This item is provided by National Bureau of Economic Research, Inc in its series NBER Chapters with number 8709.

    Handle: RePEc:nbr:nberch:8709

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    1. Anne O. Krueger, 1993. "Free Trade Agreements as Protectionist Devices: Rules of Origin," NBER Working Papers 4352, National Bureau of Economic Research, Inc.
    2. Thomas Grennes & Barry Krissoff, 1993. "Agricultural Trade in a North American Free Trade Agreement," The World Economy, Wiley Blackwell, vol. 16(4), pages 483-502, 07.
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    Cited by:
    1. John Gilbert & Reza Oladi, 2011. "Net Campaign Contributions, Agricultural Interests, and Votes on Liberalizing Trade with China," Working Papers 2011-02, Utah State University, Department of Economics.
    2. Rodrik, Dani, 1994. "What does the Political Economy Literature on Trade Policy (Not) Tell Us That We Ought to Know?," CEPR Discussion Papers 1039, C.E.P.R. Discussion Papers.
    3. Lawley, Chad, 2013. "Protectionism versus risk in screening for invasive species," Journal of Environmental Economics and Management, Elsevier, vol. 65(3), pages 438-451.
    4. Ker, Alan P., 2000. "Modeling Technical Trade Barriers Under Uncertainty," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 25(01), July.
    5. Browne, William P. & Schweikhardt, David B. & Bonnen, James T., 2000. "Chance Governs All: The Fragmented, Frustating State Of Agricultural Trade Policy In The United States," Staff Papers 11769, Michigan State University, Department of Agricultural, Food, and Resource Economics.
    6. Meilke, Karl D. & Sarker, Rakhal, 1995. "National Administered Protection Agencies: Their Role in the Post-Uruguay Round World," 1995: Understanding Technical Barriers to Agricultural Trade Conference, December 1995, Tucson, Arizona, International Agricultural Trade Research Consortium 50714, International Agricultural Trade Research Consortium.
    7. Roberts, Donna & Orden, David, 1995. "Determinants of Technical Barriers to Trade: The Case of US Phytosanitary Restrictions on Mexican Avocados, 1972-1995," 1995: Understanding Technical Barriers to Agricultural Trade Conference, December 1995, Tucson, Arizona, International Agricultural Trade Research Consortium 50709, International Agricultural Trade Research Consortium.

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