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Distortions to Agricultural Incentives in Australia Since World War II

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Author Info
Anderson, Kym
Lloyd, Peter J
Maclaren, Donald

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Abstract

Australia’s lacklustre economic growth performance in the first four decades following World War II was in part due to an anti-trade, anti-primary sector bias in government assistance policies. This paper provides new annual estimates of the extent of those biases since 1946 and their gradual phase-out during the past two decades. In doing so it reveals that the timing of the sectoral assistance cuts was such as sometimes to improve but sometimes to worsen the distortions to incentives faced by farmers. Also, the changes increased the variation of assistance rates within agriculture during the 1950s and 1960s, reducing the welfare contribution of those programs in that period. While the assistance pattern within agriculture appears not to have been strongly biased against exporters, its reform has coincided with a substantial increase in export orientation of many farm industries. The overall pattern for Australia is contrasted with that revealed by comparable new estimates for other high-income countries.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 6436.

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Date of creation: Aug 2007
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Handle: RePEc:cpr:ceprdp:6436

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Related research
Keywords: agricultural assistance; Distorted incentives; manufacturing protection; trade policy reform;

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Find related papers by JEL classification:
F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
F14 - International Economics - - Trade - - - Country and Industry Studies of Trade
Q17 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agriculture in International Trade
Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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  6. Melitz, Marc J, 2002. "The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity," CEPR Discussion Papers 3381, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
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  7. David Card & Richard B. Freeman, 2002. "What Have Two Decades of British Economic Reform Delivered?," NBER Working Papers 8801, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  8. Alan V. Deardorff, 1984. "An Exposition and Exploration of Krueger's Trade Model," Canadian Journal of Economics, Canadian Economics Association, vol. 17(4), pages 731-46, November. [Downloadable!] (restricted)
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  12. Dean Parham, 2004. "Sources of Australia's Productivity Revival," The Economic Record, The Economic Society of Australia, vol. 80(249), pages 239-257, 06. [Downloadable!] (restricted)
  13. Anderson, Kym & Lattimore, Ralph & Lloyd, Peter & MacLaren, Donald, 2007. "Distortions to Agricultural Incentives in Australia and New Zealand," 2007 Conference (51st), February 13-16, 2007, Queenstown, New Zealand 10407, Australian Agricultural and Resource Economics Society. [Downloadable!]
    Other versions:
  14. Harris, S.F., 1964. "Some Measures Of Levels Of Protection In Australia'S Rural Industries," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 8(02), December. [Downloadable!]
  15. McKay, D.H., 1967. "The Small-Farm Problem In Australia," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 11(02), December. [Downloadable!]
  16. Warr, Peter G., 1978. "The Case Against Tariff Compensation," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 22(02-03). [Downloadable!]
  17. Honma, Masayoshi & Hayami, Yujiro, 2007. "Distortions to Agricultural Incentives in Korea and Taiwan," Agricultural Distortions Working Paper 48479, World Bank. [Downloadable!]
  18. Kym Anderson & Ernesto Valenzuela, 2007. "Do Global Trade Distortions Still Harm Developing Country Farmers?," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 143(1), pages 108-139, April. [Downloadable!] (restricted)
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  19. Lloyd, P.J., 1975. "Tariff Compensation: An Undesirable Policy," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 19(03), December. [Downloadable!]
  20. Anderson, Kym, 1999. "The WTO Agenda for the New Millennium," The Economic Record, The Economic Society of Australia, vol. 75(228), pages 77-88, March.
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  22. Kym Anderson & Will Martin & Dominique van der Mensbrugghe, 2006. "Distortions to World Trade: Impacts on Agricultural Markets and Farm Incomes," Review of Agricultural Economics, American Agricultural Economics Association, vol. 28(2), pages 168-194, 06. [Downloadable!] (restricted)
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Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Kym Anderson & James Giesecke & Ernesto Valenzuela, 2008. "How would global trade liberalization affect rural and regional incomes in Australia?," Centre of Policy Studies/IMPACT Centre Working Papers g-176, Monash University, Centre of Policy Studies/IMPACT Centre. [Downloadable!]
  2. MacLaren, Donald & Lloyd, Peter, 2008. "Measuring assistance to the agricultural industry in Australia using a Production Assistance Index," 2008 Conference (52nd), February 5-8, 2008, Canberra, Australia 6033, Australian Agricultural and Resource Economics Society. [Downloadable!]
  3. Anderson, Kym & Kurzweil, Marianne & Martin, Will & Sandri, Damiano & Valenzuela, Ernesto, 2008. "Measuring distortions to agricultural incentives, revisited," Policy Research Working Paper Series 4612, The World Bank. [Downloadable!]
    Other versions:
  4. Anderson, Kym, 2009. "Political Economy of Distortions to Agricultural Incentives: Introduction and Summary," Agricultural Distortions Working Paper 50306, World Bank. [Downloadable!]
  5. Anderson, Kym & Lattimore, Ralph & Lloyd, Peter & MacLaren, Donald, 2008. "Distortions to Agricultural Incentives in Australia and New Zealand," Agricultural Distortions Working Paper 48387, World Bank. [Downloadable!]
    Other versions:
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