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Distortions to agricultural incentives in Australia since world war II

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Author Info
Anderson, Kym
Lloyd, Peter
MacLaren, Donald

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Abstract

Australia's lackluster economic growth performance in the first four decades following World War II was in part due to an anti-trade, anti-primary sector bias in government assistance policies. This paper provides new annual estimates of the extent of those biases since 1946 and their gradual phase-out during the past two decades. In doing so it reveals that the timing of the sector assistance cuts was such as sometimes to improve but sometimes to worsen the distortions to incentives faced by farmers. The changes increased the variation of assistance rates within agriculture during the 1950s and 1960s, reducing the welfare contribution of those programs in that period. Although the assistance pattern within agriculture appears not to have been strongly biased against exporters, its reform has coincided with a substantial increase in the export orientation of many farm industries. The overall pattern for Australia is contrasted with that revealed by comparable new estimates for other high-income countries.

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Paper provided by The World Bank in its series Policy Research Working Paper Series with number 4471.

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Date of creation: 01 Jan 2008
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Handle: RePEc:wbk:wbrwps:4471

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Related research
Keywords: Economic Theory&Research; Rural Development Knowledge&Information Systems; Emerging Markets; Banks&Banking Reform; Labor Policies;

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This paper has been announced in the following NEP Reports: References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Dean Parham, 2004. "Sources of Australia's Productivity Revival," The Economic Record, The Economic Society of Australia, vol. 80(249), pages 239-257, 06. [Downloadable!] (restricted)
  2. Anonymous, 2006. "Rural Water Use and the Environment: The Role of Market Mechanisms," Commissioned Studies 8020, Productivity Commission. [Downloadable!]
  3. Stephan Pfaffenzeller & Paul Newbold & Anthony Rayner, 2007. "A Short Note on Updating the Grilli and Yang Commodity Price Index," World Bank Economic Review, Oxford University Press, vol. 21(1), pages 151-163.
  4. Anderson, Kym & James, Sarah, 1998. "On the Need for More Economic Assessment of Quarantine/SPS Policies," CEPR Discussion Papers 1934, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
  5. Anderson, Kym & Lattimore, Ralph & Lloyd, Peter & MacLaren, Donald, 2007. "Distortions to Agricultural Incentives in Australia and New Zealand," 2007 Conference (51st), February 13-16, 2007, Queenstown, New Zealand 10407, Australian Agricultural and Resource Economics Society. [Downloadable!]
    Other versions:
  6. Leamer, Edward E, 1987. "Paths of Development in the Three-Factor, n-Good General Equilibrium Model," Journal of Political Economy, University of Chicago Press, vol. 95(5), pages 961-99, October. [Downloadable!] (restricted)
  7. Harris, S.F., 1964. "Some Measures Of Levels Of Protection In Australia'S Rural Industries," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 8(02), December. [Downloadable!]
  8. Kelvin Balcombe & Hristos Doucouliagos & Iain Fraser, 2007. "Input usage, output mix and industry deregulation: an analysis of the Australian dairy manufacturing industry *," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society and Blackwell Publishing Asia Pty Ltd., vol. 51(2), pages 137-156, 06. [Downloadable!] (restricted)
  9. McKay, D.H., 1967. "The Small-Farm Problem In Australia," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 11(02), December. [Downloadable!]
  10. Warr, Peter G., 1978. "The Case Against Tariff Compensation," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 22(02-03). [Downloadable!]
  11. Melitz, Marc J, 2002. "The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity," CEPR Discussion Papers 3381, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
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  12. David Card & Richard B. Freeman, 2002. "What Have Two Decades of British Economic Reform Delivered?," NBER Working Papers 8801, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  13. Honma, Masayoshi & Hayami, Yujiro, 2007. "Distortions to Agricultural Incentives in Korea and Taiwan," Agricultural Distortions Working Paper 48479, World Bank. [Downloadable!]
  14. Kym Anderson & Ernesto Valenzuela, 2007. "Do Global Trade Distortions Still Harm Developing Country Farmers?," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 143(1), pages 108-139, April. [Downloadable!] (restricted)
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  15. Alan V. Deardorff, 1984. "An Exposition and Exploration of Krueger's Trade Model," Canadian Journal of Economics, Canadian Economics Association, vol. 17(4), pages 731-46, November. [Downloadable!] (restricted)
  16. Lloyd, P.J., 1975. "Tariff Compensation: An Undesirable Policy," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 19(03), December. [Downloadable!]
  17. Anderson, Kym, 1999. "The WTO Agenda for the New Millennium," The Economic Record, The Economic Society of Australia, vol. 75(228), pages 77-88, March.
  18. Richard Baldwin, 2005. "Heterogeneous Firms and Trade: Testable and Untestable Properties of the Melitz Model," NBER Working Papers 11471, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  19. Kym Anderson & Will Martin & Dominique van der Mensbrugghe, 2006. "Distortions to World Trade: Impacts on Agricultural Markets and Farm Incomes," Review of Agricultural Economics, American Agricultural Economics Association, vol. 28(2), pages 168-194, 06. [Downloadable!] (restricted)
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  20. Kym Anderson & Lee Ann Jackson, 2005. "GM crop technology and trade restraints: economic implications for Australia and New Zealand *," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society and Blackwell Publishing Asia Pty Ltd., vol. 49(3), pages 263-281, 09. [Downloadable!] (restricted)
  21. repec:rus:hseeco:122439 is not listed on IDEAS
  22. Snape, R H, 1984. "Australia's Relations with GATT," The Economic Record, The Economic Society of Australia, vol. 60(168), pages 16-27, March.
Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Kym Anderson & James Giesecke & Ernesto Valenzuela, 2008. "How would global trade liberalization affect rural and regional incomes in Australia?," Centre of Policy Studies/IMPACT Centre Working Papers g-176, Monash University, Centre of Policy Studies/IMPACT Centre. [Downloadable!]
  2. 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:
  3. MacLaren, Donald & Lloyd, Peter, 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. [Downloadable!]
  4. Anderson, Kym & Kurzweil, Marianne & Martin, Will & Sandri, Damiano & Valenzuela, Ernesto, 2008. "Measuring distortions to agricultural incentives, revisited," Policy Research Working Paper Series 4612, The World Bank. [Downloadable!]
    Other versions:
  5. Anderson, Kym, 2009. "Political Economy of Distortions to Agricultural Incentives: Introduction and Summary," Agricultural Distortions Working Paper 50306, World Bank. [Downloadable!]
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