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Trade Distortion Indexes and Applied General Equilibrium Models: The Case of the Common Agricoltural Policy

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  • Luca Salvatici

Abstract

In this paper, we build on the insights of the Trade Restrictiveness Index (TRI) approach by computing uniform tariff equivalents for the European Union primary sector using the Global Trade Analysis Project model and its associated data base. The main contribution of the paper is to extend and adapt the definition of the TRI, in order to make it consistent with the structure of a multi-regional Applied General Equilibrium model. In this perspective, we define a “modified TRI†based on the direct welfare evaluation (rather than on the Balance of trade function) and extend its definition in order to take into account the terms of trade impact. Finally, an empirical application of the index is provided with reference to two policy scenarios: the liberalization of the Common Agricultural Policy and the implementation of the “Agenda 2000†reform.

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Bibliographic Info

Paper provided by University of Rome La Sapienza, Department of Public Economics in its series Working Papers with number 45.

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Length: 32
Date of creation: Nov 2001
Date of revision:
Handle: RePEc:sap:wpaper:wp45

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Related research

Keywords: international agricultural trade; tariffs and tariff factors; welfare analysis; computable general equilibrium models.;

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References

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  1. Salvatici, Luca & Carter, Colin A. & Sumner, Daniel A., 1997. "The Trade Restrictiveness Index: The Potential Contribution To Agricultural Policy Analysis," 1997 Annual meeting, July 27-30, Toronto, Canada 21028, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
  2. W. Jill Harrison & K.R. Pearson, 1994. "Computing Solutions for Large General Equilibrium Models Using GEMPACK," Centre of Policy Studies/IMPACT Centre Working Papers ip-64, Victoria University, Centre of Policy Studies/IMPACT Centre.
  3. O'Rourke, Kevin H., 1997. "Measuring protection: a cautionary tale," Journal of Development Economics, Elsevier, vol. 53(1), pages 169-183, June.
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Cited by:
  1. Bureau Jean-Christophe & Salvatici Luca, 2004. "WTO Negotiations on Market Access in Agriculture: a Comparison of Alternative Tariff Cut Proposals for the EU and the US," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 4(1), pages 1-35, March.
  2. Salvatici, Luca & Cipollina, Maria, 2006. "Measuring Protection: Mission Impossible?," Working Papers 18876, TRADEAG - Agricultural Trade Agreements.
  3. Bureau, Jean-Christophe & Salvatici, Luca, 2002. "WTO Negotiations on Market Access in Agriculture: A Comparison of Alternative Tariff Cut Scenarios for the EU and the US," 2002 International Congress, August 28-31, 2002, Zaragoza, Spain 24883, European Association of Agricultural Economists.

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