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A CGE Analysis of the Harbinson Proposal: Outcomes for the EU25

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Author Info
Philippidis, George
Hubbard, L.J.
Renwick, Alan
Abstract

In this study, we employ the Harbinson proposal and July Framework to compare a ‘likely’ Doha scenario with an ‘inclusive’ baseline. The key aim is to assess the impacts across EU member states. More specifically, we (i) employ the latest version 6 of the GTAP database, (ii) explicitly model CAP mechanisms (e.g., quotas, decoupled payments, set-aside, CAP budget etc.) to more accurately assess the asymmetric trade led welfare effects on selected EU member states, and (iii) introduce binding overhangs into domestic support, export subsidies and more importantly market access commitments. Whilst the EU regions benefit from the multilateral reform proposals, the gains are weakened considerably by the tariff binding overhangs, where the EU25 only gain ten per cent of their potential trade led welfare gain from the proposals. On this basis, a more positive stance must be applied if the Doha Reforms are to yield a meaningful outcome for all.

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Paper provided by Scottish Agricultural College, Land Economy Research Group in its series Working Papers with number 45992.

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Date of creation: May 2006
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Handle: RePEc:ags:saclwp:45992

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  1. Hertel, Thomas W., 1994. "The 'procompetitive' effects of trade policy reform in a small, open economy," Journal of International Economics, Elsevier, vol. 36(3-4), pages 391-411, May. [Downloadable!] (restricted)
  2. Markus Lips & Peter Rieder, 2005. "Abolition of Raw Milk Quota in the European Union: A CGE Analysis at the Member Country Level," Journal of Agricultural Economics, Blackwell Publishing, vol. 56(1), pages 1-17. [Downloadable!] (restricted)
  3. Hart, Chad E. & Beghin, John C., 2006. "Rethinking Agricultural Domestic Support under the World Trade Organization," Staff General Research Papers 12510, Iowa State University, Department of Economics.
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  4. Alan Swinbank, 2005. "Developments in the Doha Round and WTO dispute settlement: some implications for EU agricultural policy," European Review of Agricultural Economics, Oxford University Press for the Foundation for the European Review of Agricultural Economics, vol. 32(4), pages 551-561, December.
  5. McDougall, Robert, 2000. "A New Regional Household Demand System for GTAP," GTAP Working Papers 404, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University. [Downloadable!]
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  6. McCorriston, Steve & MacLaren, Donald, 2005. "Trade and Welfare Effects of State Trading Enterprises," 2005 International Congress, August 23-27, 2005, Copenhagen, Denmark 24523, European Association of Agricultural Economists. [Downloadable!]
  7. Giovanni Anania & Jean-Christophe Bureau, 2005. "The negotiations on agriculture in the Doha Development Agenda Round: current status and future prospects," European Review of Agricultural Economics, Oxford University Press for the Foundation for the European Review of Agricultural Economics, vol. 32(4), pages 539-574, December.
  8. Bach, Christian Friis & Ken Pearson, 1996. "Implementing Quotas in GTAP Using GEMPACK or How to Linearize an Inequality," GTAP Technical Papers 307, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University. [Downloadable!]
  9. Dixit, Avinash K & Stiglitz, Joseph E, 1977. "Monopolistic Competition and Optimum Product Diversity," American Economic Review, American Economic Association, vol. 67(3), pages 297-308, June. [Downloadable!] (restricted)
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  10. Elbehri, Aziz & Ken Pearson, 2000. "Implementing Bilateral Tariff Rate Quotas in GTAP using GEMPACK," GTAP Technical Papers 475, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University. [Downloadable!]
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