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Distortions to Global Agricultural Markets: What Next?

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  • Kym Anderson

    ()
    (School of Economics, University of Adelaide)

Abstract

A decline in governmental distortions to agricultural and other trade since the 1980s has contributed to economic growth and poverty alleviation globally. But new modeling results suggest that has taken the world only three-fifths of the way towards freeing merchandise trade, and that farm policies are responsible for 70 percent of the global welfare cost of remaining distortions to goods markets as of 2004. Meanwhile, new drivers are affecting the mean and variance of world prices of farm products, including biofuel mandates and subsidies, climate change mitigation policies and adaptation, water institution and policy developments, difficulties in concluding a multilateral Doha Round agricultural agreement at the WTO, and policies relating to transgenic foods. This paper reviews trends and fluctuations in past distortions to agricultural incentives, speculates on how they might evolve in coming decades alongside other market developments, and draws out implications for Australia.

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File URL: http://www.adelaide.edu.au/cies/publications/present/CIES_DP1010.pdf
File Function: First version, 2010
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Bibliographic Info

Paper provided by University of Adelaide, Centre for International Economic Studies in its series Centre for International Economic Studies Working Papers with number 2010-10.

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Length: 34 pages
Date of creation: Mar 2010
Date of revision:
Handle: RePEc:adl:cieswp:2010-10

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Keywords: Distorted incentives; agricultural and trade policy reforms; Asia-Pacific region;

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