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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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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. Hiau LooiKee & Alessandro Nicita & Marcelo Olarreaga, 2009. "Estimating Trade Restrictiveness Indices," Economic Journal, Royal Economic Society, vol. 119(534), pages 172-199, 01.
  2. Robert C. Feenstra, 1995. "Estimating the Effects of Trade Policy," NBER Working Papers 5051, National Bureau of Economic Research, Inc.
  3. Anderson, Kym & Martin, William J., 2007. "Distortions to Agricultural Incentives in Asia," Agricultural Distortions Working Paper 48557, World Bank.
  4. Johanna L. Croser & Peter J. Lloyd & Kym Anderson, 2010. "How Do Agricultural Policy Restrictions on Global Trade and Welfare Differ Across Commodities?," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 92(3), pages 698-712.
  5. Valenzuela, Ernesto & Wong, Sara & Sandri, Damiano, 2007. "Distortions to Agricultural Incentives in Ecuador," Agricultural Distortions Working Paper 48394, World Bank.
  6. Kee, Hiau Looi & Nicita, Alessandro & Olarreaga, Marcelo, 2004. "Import Demand Elasticities and Trade Distortions," CEPR Discussion Papers 4669, C.E.P.R. Discussion Papers.
  7. 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.
  8. Anderson, Kym & Kurzweil, Marianne & Martin, Will & Sandri, Damiano & Valenzuela, Ernesto, 2008. "Measuring distortions to agricultural incentives, revisited," World Trade Review, Cambridge University Press, vol. 7(04), pages 675-704, October.
  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, December.
  10. Anderson, James E. & Bannister, Geoffrey, 1992. "The trade restrictiveness index : an application to Mexican agriculture," Policy Research Working Paper Series 874, The World Bank.
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Cited by:
  1. Anderson, Kym & Croser, Johanna L. & Lloyd, Peter J, 2009. "How Do Agricultural Policy Restrictions to Global Trade and Welfare Differ Across Commodities?," CEPR Discussion Papers 7230, C.E.P.R. Discussion Papers.
  2. Kym Anderson & Johanna Croser & Damiano Sandri & Ernesto Valenzuela, 2010. "Agricultural Distortion Patterns Since the 1950s: What Needs Explaining?," Centre for International Economic Studies Working Papers 2010-13, University of Adelaide, Centre for International Economic Studies.
  3. Johanna Croser & Kym Anderson, 2010. "Changing Ccontributions of Different Agricultural Policy Instruments to Global Reductions in Trade and Welfare," Centre for International Economic Studies Working Papers 2010-05, University of Adelaide, Centre for International Economic Studies.
  4. Kym Anderson, 2010. "Krueger/Schiff/Valdes Revisited: Agricultural Price and Trade Policy Reform in Developing Countries since 1960," Centre for International Economic Studies Working Papers 2010-04, University of Adelaide, Centre for International Economic Studies.
  5. Anderson, Kym & Croser, Johanna L., 2010. "Novel Indicators of the Trade and Welfare Effects of Agricultural Distortions in OECD Countries," CEPR Discussion Papers 7971, C.E.P.R. Discussion Papers.
  6. Anderson, Kym, 2009. "Political Economy of Distortions to Agricultural Incentives: Introduction and Summary," Agricultural Distortions Working Paper 50306, World Bank.
  7. 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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