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Assessing the potential cost of a failed Doha round

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  • Antoine Bouet

    (IFPRI - International Food Policy Research Institute - aaa, Larefi - Laboratoire d'analyse et de recherche en économie et finance internationales - Université Montesquieu - Bordeaux IV : EA2954)

Abstract

This study offers new conclusions on the economic cost of a failed Doha Development Agenda (DDA). We assess potential outcome of the Doha Round as well as four protectionist scenarios using the MIRAGE Computable General Equilibrium (CGE) model. In a scenario where applied tariffs of World Trade Organization (WTO) economies would go up to currently bound tariff rates, world trade would decrease by 7.7 % and world welfare by US$353 billion. The economic cost of a failed DDA is here evaluated by the difference between a cooperative scenario (DDA) and a protectionist one (US$412 billion in terms of welfare). Another point of view is to compare a resort to protectionism when the DDA is implemented with a resort to protectionism when the DDA is not implemented. The findings show that this trade agreement could prevent the potential reduction of US$809 billion of trade and, therefore, acts as an efficient multilateral 'preventive' scheme against the adverse consequences of trade "beggar-thy-neighbor" policies.

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Bibliographic Info

Paper provided by HAL in its series Working Papers with number hal-00637583.

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Date of creation: 07 Jan 2010
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Handle: RePEc:hal:wpaper:hal-00637583

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Keywords: trade negotiations; CGE modeling; bound duties; domestic support;

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References

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  1. Yvan Decreux & Lionel Fontagné, 2006. "A Quantitative Assessment of the Outcome of the Doha Development Agenda," Working Papers 2006-10, CEPII research center.
  2. Kym Anderson & Will Martin, 2005. "Agricultural Trade Reform and the Doha Development Agenda," The World Economy, Wiley Blackwell, vol. 28(9), pages 1301-1327, 09.
  3. Jean, Sebastien & Laborde, David & Martin, Will, 2008. "Choosing sensitive agricultural products in trade negotiations:," IFPRI discussion papers 788, International Food Policy Research Institute (IFPRI).
  4. Antoine Bouët & Yvan Decreux & Lionel Fontagné & Sébastien Jean & David Laborde, 2008. "Assessing applied protection across the world," Working Papers 26327, Institut National de la Recherche Agronomique, France.
  5. Bairoch, Paul, 1995. "Economics and World History," University of Chicago Press Economics Books, University of Chicago Press, edition 1, number 9780226034638, February.
  6. Yvan Decreux & Hugo Valin, 2007. "MIRAGE, Updated Version of the Model for Trade Policy Analysis: Focus on Agriculture and Dynamics," Working Papers 2007-15, CEPII research center.
  7. Will Martin & Patrick Messerlin, 2007. "Why is it so difficult? Trade liberalization under the Doha Agenda," Oxford Review of Economic Policy, Oxford University Press, vol. 23(3), pages 347-366, Autumn.
  8. Sébastien Jean & David Laborde & Will Martin, 2005. "Consequences of Alternative Formulas for Agricultural Tariff Cuts," Working Papers 2005-15, CEPII research center.
  9. Gary Clyde Hufbauer & Jeffrey J. Schott, 2009. "Buy American: Bad for Jobs, Worse for Reputation," Policy Briefs PB09-2, Peterson Institute for International Economics.
  10. Bouet, Antoine & Decreux, Yvan & Fontagne, Lionel & Jean, Sebastien & Laborde, David, 2005. "A Consistent Picture of Applied Protection Across the World," Working Papers 18859, TRADEAG - Agricultural Trade Agreements.
  11. Houssein Guimbard & David Laborde Debucquet & Cristina Mitaritonna, 2009. "A Picture of Tariff Protection Across the World in 2004 MAcMap-HS6, Version 2," Working Papers 2009-22, CEPII research center.
  12. Jakob B. Madsen, 2001. "Trade Barriers and the Collapse of World Trade During the Great Depression," Southern Economic Journal, Southern Economic Association, vol. 67(4), pages 848-868, April.
  13. Antoine Bou�t & Simon Mevel & David Orden, 2007. "More or Less Ambition in the Doha Round: Winners and Losers from Trade Liberalisation with a Development Perspective," The World Economy, Wiley Blackwell, vol. 30(8), pages 1253-1280, 08.
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Citations

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Cited by:
  1. Anderson, Kym & Martin, Will & van der Mensbrugghe, Dominique, 2012. "Estimating effects of price-distorting policies using alternative distortions databases," CEPR Discussion Papers 9083, C.E.P.R. Discussion Papers.
  2. Yvan Decreux & Lionel Fontagné, 2013. "What Did Happen in the DDA? Quantifying the Role of Negotiation Modalities," Working Papers 2013-38, CEPII research center.
  3. Christophe Gouel & Cristina Mitaritonna & Maria Priscila Ramos, 2010. "The Art of Exceptions: Sensitive Products in the Doha Negotiations," Working Papers 2010-20, CEPII research center.
  4. Gouel, Christophe, 2013. "Food price volatility and domestic stabilization policies in developing countries," Policy Research Working Paper Series 6393, The World Bank.
  5. repec:laf:wpaper:201003 is not listed on IDEAS
  6. repec:laf:wpaper:201002 is not listed on IDEAS
  7. Bouet, Antoine & Laborde Debucquet, David, 2010. "Eight years of Doha trade talks," IFPRI discussion papers 997, International Food Policy Research Institute (IFPRI).
  8. Bouet, Antoine & Laborde, David, 2010. "Eight Years of Doha Trade Talks: Where Do We Stand?," eJADE: electronic Journal of Agricultural and Development Economics, Food and Agriculture Organization, Agricultural and Development Economics Division, vol. 11(2).
  9. Matthews, Alan, 2013. "DOHA Negotiations on Agriculture and Future of the WTO Multilateral Trade System," 135th Seminar, August 28-30, 2013, Belgrade, Serbia 160370, European Association of Agricultural Economists.
  10. Antoine Bouet & Guillaume Gruere, 2010. "Refining opportunity cost estimates of not adopting GM cotton : An application in seven sub-saharan african countries," Working Papers hal-00637587, HAL.
  11. Hertel, Thomas, 2013. "Global Applied General Equilibrium Analysis Using the Global Trade Analysis Project Framework," Handbook of Computable General Equilibrium Modeling, Elsevier.
  12. Popa, Diana, 2011. "Runda Doha: început fără sfârşit
    [Doha Round: the endless beginning]
    ," MPRA Paper 28764, University Library of Munich, Germany, revised 09 Feb 2011.

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