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Effect of Liberalized U.S.-Mexico Dry Onion Trade: A Spatial and Intertemporal Equilibrium Analysis

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  • Fuller, Stephen
  • Gillis, Melanie
  • Ziari, Houshmand A.

Abstract

A spatial, intertemporal equilibrium model of the North American dry onion economy is constructed to analyze the impact of liberalized U.S.-Mexico trade. In a free-trade environment, exports of Mexican onions to the U.S. are projected to increase about 50%, while Mexico's share of the U.S. market increases from 8.7 to 12.8%. Farm-level prices in the U.S. are projected to decline 8.9%, while production declines 2.4%. The effect of free trade on U.S. producers is disproportional across regions. Northwest storage onion producers experience the greatest decline in production; however, analysis suggests that improved storage methods may offset a portion of the unfavorable impacts of liberalized trade on these producers. In spite of the unfavorable impact of free trade on U.S. dry onion producers, the industry would not be economically devastated.

Suggested Citation

  • Fuller, Stephen & Gillis, Melanie & Ziari, Houshmand A., 1996. "Effect of Liberalized U.S.-Mexico Dry Onion Trade: A Spatial and Intertemporal Equilibrium Analysis," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 28(1), pages 135-147, July.
    • Handle: RePEc:cup:jagaec:v:28:y:1996:i:01:p:135-147_00
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    Cited by:

    1. Fellin, Luis & Fuller, Stephen & Grant, Warren & Smotek, Connie, 2001. "Measuring Benefits from Inland Waterway Navigation Improvements," Journal of the Transportation Research Forum, Transportation Research Forum, vol. 40(2).
    2. Malaga, Jaime E. & Williams, Gary W. & Fuller, Stephen W., 2001. "US-Mexico fresh vegetable trade: the effects of trade liberalization and economic growth," Agricultural Economics, Blackwell, vol. 26(1), pages 45-55, October.
    3. Cui, Lina, 2010. "Trade Factors Affecting Apple Exports from China to Thailand," 2010 Annual Meeting, February 6-9, 2010, Orlando, Florida 56388, Southern Agricultural Economics Association.

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