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Comparative Advantage and Competitiveness of Wheat Crop in Pakistan

Author

Listed:
  • Sofia Anwar

    (University of Agriculture, Faisalabad, Pakistan.)

  • Zakir Hussain

    (University of Agriculture, Faisalabad, Pakistan.)

  • M. Siddique Javed

    (University of Agriculture, Faisalabad, Pakistan.)

Abstract

This study was conducted to analyze the comparative advantage and competitiveness of wheat crop and its implications for resource allocation towards competing crops. The extent of policy distortion and agricultural protection was also determined by the study. The data were collected from APCom on cost of production of wheat cropover the three year period (2001-2003). Two main provinces contributing towards wheat production i.e. Punjab and Sindh were selected as the sample. This data were then averaged to obtain a national scenario. The cropbudgets were prepared initially in financial terms and later on economic prices were utilized to evaluate the comparative advantage and competitiveness of the wheat crop. The Policy Analysis Matrix (PAM) was selected as the analytical framework. The policy distortions were measured through Nominal Protection Coefficient (NPC) and Effective Protection Coefficient (EPC). The Domestic Resource Cost ratio (DRC) was selected as a measuring tool for comparative advantage. Keeping in view the importance of wheat in the economy, the analysis was conducted in two price regimes i.e. import and exportparity prices. The analysis results showed that at import parity price Pakistan has a comparative advantage in the production of wheat only as an importsubstitution crop. At export parity price, Pakistan is not competitive inthe world wheat market and has no comparative advantage in wheat production.

Suggested Citation

  • Sofia Anwar & Zakir Hussain & M. Siddique Javed, 2005. "Comparative Advantage and Competitiveness of Wheat Crop in Pakistan," Lahore Journal of Economics, Department of Economics, The Lahore School of Economics, vol. 10(2), pages 101-110, Jul-Dec.
    • Handle: RePEc:lje:journl:v:10:y:2005:i:2:p:101-110
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    References listed on IDEAS

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    1. Gerald C. Nelson & Martin Panggabean, 1991. "The Costs of Indonesian Sugar Policy: A Policy Analysis Matrix Approach," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 73(3), pages 703-712.
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    Cited by:

    1. Munir, Kashif & Sultan, Maryam, 2016. "Export Performance with Border Sharing Countries: An Assessment of Pakistan," MPRA Paper 69535, University Library of Munich, Germany.

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