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Revealed Comparative Advantage and Half-A-Century Competitiveness of Canadian Agriculture: A Case Study of Wheat, Beef and Pork Sectors

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  • Sarker, Rakhal
  • Ratnesena, Shashini
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    Abstract

    While the competitiveness of the Canadian agri-food sector attracted significant research attention since the mid 1980s, no study has measured competitiveness using longitudinal data and determined empirically the drivers of competitiveness. This article contributes to the competitiveness literature by measuring the international competitiveness of wheat, beef and pork sectors in Canada using data from 1961 to 2011 and by determining the drivers of competitiveness. Our results demonstrate that Canada enjoys competitiveness in the wheat sector but not in the beef or pork sectors. Empirical results also suggest that the competitiveness of the Canadian wheat sector can be enhanced if the cost seed in Canada relative to that in the United States is lower. Similarly, if the relative labour cost of meat processing is lower, the competitiveness of both beef and pork sectors in Canada will be enhanced. Exchange rates are important drivers of international competitiveness of beef and pork sectors in Canada. The decoupled farm policies in Canada do not have a significant impact on the competitiveness of wheat and pork sectors in Canada. Our empirical results also highlight cases of significant policy failures in Canada.

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    Bibliographic Info

    Paper provided by Canadian Agricultural Trade Policy Research Network in its series Working Papers with number 165675.

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    Date of creation: Mar 2014
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    Handle: RePEc:ags:catpwp:165675

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    Keywords: Competitiveness; Measurement; Normalized Revealed Comparative Advantage; Wheat; beef and pork sectors; Drivers of Competitiveness; Agribusiness; Agricultural and Food Policy; International Relations/Trade;

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