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Do Price Uncertainties Affect the Use of Policy Flexibilities? The Selection of Sensitive Products in WTO Agricultural Negotiations

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  • Listorti, Giulia
  • Kempen, Markus
  • Girardin, Jean
  • Kranzlein, Tim
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    Abstract

    In a context in which price uncertainty is likely to increase, expected market trends need to be taken carefully into account while negotiating international trade policy rules. This paper aims at analyzing what is their influence on the use of policy flexibilities in the context of WTO agricultural negotiations. In particular, within the market access pillar, we focus on the selection of sensitive products. Our model, TRIMAG (Tariff Reduction Impact Model for Agriculture), defined at the 8-digit level, optimizes the domestic agricultural value added subject to a maximum number of sensitive tariff lines, accounting for various future international price scenarios. Furthermore, we test the use of alternative options for the implementation of “tariff simplification”. Findings confirm that the future expected development of world and domestic prices plays an important role in the selection of sensitive products, and that tariff simplification doesn’t affect the results, if provisions to ensure the neutrality of the exercise are put in place. Furthermore, TRIMAG can be considered as a tariff aggregation tool that can be linked to agricultural simulation models that operate at a higher level of aggregation.

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    File URL: http://purl.umn.edu/114381
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    Bibliographic Info

    Paper provided by European Association of Agricultural Economists in its series 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland with number 114381.

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    Date of creation: 2011
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    Handle: RePEc:ags:eaae11:114381

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    Related research

    Keywords: WTO agricultural negotiations; market access; sensitive products; International Relations/Trade; F13; Q17;

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    1. Skully, David W., 2001. "Economics Of Tariff-Rate Quota Administration," Technical Bulletins 33576, United States Department of Agriculture, Economic Research Service.
    2. Jean, Sebastien & Laborde, David & Martin, Will, 2010. "Formulas and flexibility in trade negotiations : sensitive agricultural products in the WTO's Doha agenda," Policy Research Working Paper Series 5200, The World Bank.
    3. Baffes, John & Haniotis, Tassos, 2010. "Placing the 2006/08 commodity price boom into perspective," Policy Research Working Paper Series 5371, The World Bank.
    4. Anderson, Kym & Martin, Will, 2005. "Agricultural trade reform and the Doha development agenda," Policy Research Working Paper Series 3607, The World Bank.
    5. Mohamed Hedi Bchir & Sébastien Jean & David Laborde, 2005. "Binding Overhang and Tariff-Cutting Formulas," Working Papers 2005-18, CEPII research center.
    6. Alexandre Gohin, 2008. "La sélection des produits agricoles sensibles : le cas européen," Review of Agricultural and Environmental Studies - Revue d'Etudes en Agriculture et Environnement, INRA Department of Economics, vol. 87(2), pages 49-76.
    7. Christophe Gouel & Cristina Mitaritonna & Maria Priscila Ramos, 2010. "The Art of Exceptions: Sensitive Products in the Doha Negotiations," Working Papers 2010-20, CEPII research center.
    8. Antoine Bouët & Yvan Decreux & Lionel Fontagné & Sébastien Jean & David Laborde, 2004. "A Consistent, Ad-Valorem Equivalent Measure of Applied Protection Across the World: The MAcMap-HS6 Database," Working Papers 2004-22, CEPII research center.
    9. Jason H. Grant & Thomas W. Hertel & Thomas F. Rutherford, 2007. "Dairy Tariff-Quota Liberalization: Contrasting Bilateral and Most Favored Nation Reform Options," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 91(3), pages 673-684.
    10. Maria Priscila Ramos & Jean-Christophe Bureau & Luca Salvatici, 2010. "Trade composition effects of the EU tariff structure: beef imports from Mercosur," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 37(1), pages 1-26, March.
    11. Marie Gabrielle Piketty & Lucie Weissleder & Hildo Meirelles de Souza Filho & Mário Otávio Batalha & Marcel Adenäuer & Arno Becker, 2009. "Assessing agricultural trade policies options with the European Union: a Brazilian perspective," Agricultural Economics, International Association of Agricultural Economists, vol. 40(4), pages 447-457, 07.
    12. Listorti, Giulia & Kempen, Markus & Girardin, Jean & Kranzlein, Tim, 2011. "Evaluating existing policy flexibilities in WTO agricultural negotiations: different criteria for the selection of sensitive products," 122nd Seminar, February 17-18, 2011, Ancona, Italy 98986, European Association of Agricultural Economists.
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