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Lobbying Incentives and the Pattern of Protection in Rich and Poor Countries

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Author Info
Anderson, Kym

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Abstract

In seeking to explain why poor countries tend to choose policies that tax agriculture relative to manufacturing while rich countries do the opposite, archetypical parameters for a poor agrarian economy and a rich industrial one are inserted in a computable general equilibrium model to simulate the medium-term effects on income distribution of policies that distort the relative prices of tradables. The model includes a non-tradables sector and intermediate inputs, realistic features that ensure even greater skewness in the distributional effects of protection than simpler models suggest. The magnitude of the results helps explain the tendency for countries to change gradually from taxing to subsidizing agriculture relative to manufacturing as their economies develop. The paper draws out the implications of the analysis for agricultural and trade policy reform in the 1990s.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 789.

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Date of creation: Jun 1993
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Handle: RePEc:cpr:ceprdp:789

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Related research
Keywords: Agricultural Protection; Industrial Protection; Lobbying; Political Economy;

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Find related papers by JEL classification:
F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations

Cited by:
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  1. Tobias Müller & Jean-Marie Grether, 2002. "Long-Run Effects of the Common Agricultural Policy for Switzerland: A Simulation Analysis," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 138(III), pages 271-292, September. [Downloadable!]
  2. Bates, Robert H. & Block, Steven, 2009. "Political Economy of Agricultural Trade Interventions in Africa," Agricultural Distortions Working Paper 50302, World Bank. [Downloadable!]
  3. Anderson, Kym & Hoekman, Bernard, 1999. "Developing Country Agriculture and the New Trade Agenda," CEPR Discussion Papers 2096, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
    Other versions:
  4. Frédéric PUECH, 2002. "Dépenses publiques d’éducation et instabilité politique : une application à la zone franc par un modèle d’Equilibre Général Calculable," Working Papers 200219, CERDI. [Downloadable!]
  5. Kaminski, Bartlomiej, 1999. "The EU factor in the trade policies of Central European countries," Policy Research Working Paper Series 2239, The World Bank. [Downloadable!]
  6. Kym Anderson & Warwick J. McKibbin, 1997. "Reducing Coal Subsidies and Trade Barriers: Their Contribution to Greenhouse Gas Abatement," Economics and Environment Network Working Papers 9703, Australian National University, Economics and Environment Network. [Downloadable!]
    Other versions:
  7. Anderson, Kym & Huang, Jikun & Ianchovichina, Elena, 2004. "Will China's WTO Accession Worsen Rural Poverty?," CEPR Discussion Papers 4196, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
  8. Anderson, Kym, 2008. "Distorted Agricultural Incentives and Economic Development: Asia’s Experience," CEPR Discussion Papers 6914, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
    Other versions:
  9. Gordon Rausser & Gerard Roland, 2008. "Special Interests Versus the Public Interest: The Determination of Policy Instruments," Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series 1057, Department of Agricultural & Resource Economics, UC Berkeley. [Downloadable!]
  10. Rausser, Gordon C. & Roland, Gerard, 2009. "Special Interests versus the Public Interest in Policy Determination," Agricultural Distortions Working Paper 50294, World Bank. [Downloadable!]
  11. 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:
  12. Anderson, Kym & Masters, William A., 2007. "Distortions to Agricultural Incentives in Africa," Agricultural Distortions Working Paper 48554, World Bank. [Downloadable!]
  13. David, Cristina C. & Intal, Ponciano & Balisacan, Arsenio M., 2007. "Distortions to Agricultural Incentives in the Philippines," Agricultural Distortions Working Paper 48477, World Bank. [Downloadable!]
  14. Masters, William A. & Garcia, Andres F., 2009. "Agricultural Price Distortion and Stabilization: Stylized facts and Hypothesis Tests," Agricultural Distortions Working Paper 50301, World Bank. [Downloadable!]
  15. Anderson, Kym & Huang, Jikun & Ianchovichina, Elena, 2003. "Long-run impacts of China's WTO accession on farm-nonfarm income inequality and rural poverty," Policy Research Working Paper Series 3052, The World Bank. [Downloadable!]
  16. Hertel, Thomas W. & Keeney, Roman & Ivanic, Maros & Winters, L. Alan, 2006. "Distributional effects of WTO agricultural reforms in rich and poor countries," Policy Research Working Paper Series 4060, The World Bank. [Downloadable!]
    Other versions:
  17. Dutt, Pushan & Mitra, Devashish, 2009. "Explaining Agricultural Distortion Patterns : The Roles of Ideology, Inequality, Lobbying and Public Finance," Agricultural Distortions Working Paper 50299, World Bank. [Downloadable!]
  18. Anderson, Kym, 2006. "Reducing distortions to agricultural incentives : progress, pitfalls, and prospects," Policy Research Working Paper Series 4092, The World Bank. [Downloadable!]
    Other versions:
  19. Swinnen, Johan F.M., 2008. "The Political Economy of Agricultural Protection: Europe in the 19th and 20th Century," 2008 International Congress, August 26-29, 2008, Ghent, Belgium 43859, European Association of Agricultural Economists. [Downloadable!]
  20. Anderson, Kym & Croser, Johanna & Sandri, Damiano & Valenzuela, Ernesto, 2009. "Agricultural Distortion Patterns Since the 1950s: What Needs Explaining?," Agricultural Distortions Working Paper 50305, World Bank. [Downloadable!]
  21. Olper, Alessandro & Falkowski, Jan & Swinnen, Jo, 2009. "Democracy and Agricultural Protection: Parametric and Semi-parametric Matching Estimates," 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin 49313, Agricultural and Applied Economics Association. [Downloadable!]
  22. Gawande, Kishore & Hoekman, Bernard, 2009. "Why Governments Tax or Subsidize Trade: Evidence from Agriculture," Agricultural Distortions Working Paper 50300, World Bank. [Downloadable!]
  23. Swinnen, Johan F.M., 2009. "Agricultural Protection Growth in Europe, 1870-1969," Agricultural Distortions Working Paper 50296, World Bank. [Downloadable!]
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