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Global Distortions to Agricultural Markets: New Indicators of Trade and Welfare Impacts, 1955 to 2007

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  • Anderson, Kym
  • Croser, Johanna L.
  • Lloyd, Peter J

Abstract

Despite recent reforms, world agricultural markets remain highly distorted by government policies. Traditional indicators of those price distortions can be poor guides to the policies’ economic effects. Recent theoretical literature provides indicators of trade- and welfare-reducing effects of price and trade policies which this paper builds on to develop more-satisfactory indexes. We then exploit a new Agricultural Distortion database to generate estimates of them for developing and high-income countries over the past half century. These better approximations of the trade and welfare effects of sectoral policies are generated without a formal model of global markets or even price elasticity estimates.

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Bibliographic Info

Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 7160.

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Date of creation: Feb 2009
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Handle: RePEc:cpr:ceprdp:7160

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Keywords: agricultural and trade policies; Distorted incentives; trade restrictiveness index;

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References

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  1. Kee, Hiau Looi & Nicita, Alessandro & Olarreaga, Marcelo, 2006. "Estimating trade restrictiveness indices," Policy Research Working Paper Series 3840, The World Bank.
  2. Feenstra, R.C., 1995. "Estimating the Effects of Trade Policy," Papers 95-10, California Davis - Institute of Governmental Affairs.
  3. MacLaren, Donald & Lloyd, Peter J., 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.
  4. Anderson, Kym & Kurzweil, Marianne & Martin, Will & Sandri, Damiano & Valenzuela, Ernesto, 2008. "Measuring Distortions to Agricultural Incentives, Revisited," CEPR Discussion Papers 6924, C.E.P.R. Discussion Papers.
  5. Anderson, James E. & Bannister, Geoffrey, 1992. "The trade restrictiveness index : an application to Mexican agriculture," Policy Research Working Paper Series 874, The World Bank.
  6. Hiau Looi Kee & Alessandro Nicita & Marcelo Olarreaga, 2008. "Import Demand Elasticities and Trade Distortions," The Review of Economics and Statistics, MIT Press, vol. 90(4), pages 666-682, November.
  7. Johanna L. Croser & Peter J. Lloyd & Kym Anderson, 2009. "How Do Agricultural Policy Restrictions to Global Trade and Welfare Differ Across Commodities?," School of Economics Working Papers 2009-12, University of Adelaide, School of Economics.
  8. Valenzuela, Ernesto & Wong, Sara & Sandri, Damiano, 2007. "Distortions to Agricultural Incentives in Ecuador," Agricultural Distortions Working Paper 48394, World Bank.
  9. James E. Anderson & J. Peter Neary, 2005. "Measuring the Restrictiveness of International Trade Policy," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262012200.
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Cited by:
  1. Lloyd, Peter J. & Croser, Johanna L. & Anderson, Kym, 2009. "How do agricultural policy restrictions to global trade and welfare differ across commodities ?," Policy Research Working Paper Series 4864, The World Bank.
  2. Anderson, Kym, 2009. "Political Economy of Distortions to Agricultural Incentives: Introduction and Summary," Agricultural Distortions Working Paper 50306, World Bank.
  3. Anderson, Kym & Croser, Johanna L. & Sandri, Damiano & Valenzuela, Ernesto, 2009. "Agricultural Distortion Patterns Since the 1950s: What Needs Explaining?," Agricultural Distortions Working Paper 50305, World Bank.
  4. Cletus C. Coughlin, 2010. "Measuring international trade policy: a primer on trade restrictiveness indices," Review, Federal Reserve Bank of St. Louis, issue Sep, pages 381-394.

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