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The Common Agricultural Policy: A Review of Its Operation and Effects on Developing Countries

  • Koester, Ulrich
  • Bale, Malcolm D
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    Policy changes in the European Community (EC)--the world's largest importer and, since 1986, exporter of agricultural commodities--may have significant effects on world markets and developing countries. This article investigates the EC's Common Agricultural Policy (CAP), its history, mode of operation, and the prospects and possibilities for change, to bring out the implications of the policy for developing country exporters and importers. The hypothesis that evolves differs from that of many studies in proposing that an agricultural liberalization in the EC is unlikely to effect any great change in world market prices over the first few years. Developing countries' principal gain from a liberalization of the CAP would derive from increased stability of world market prices, improved access to export markets, and a reduction in the uncertainty currently caused by discretionary measures in the EC. Copyright 1990 by Oxford University Press.

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    Article provided by World Bank Group in its journal World Bank Research Observer.

    Volume (Year): 5 (1990)
    Issue (Month): 1 (January)
    Pages: 95-121

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    Handle: RePEc:oup:wbrobs:v:5:y:1990:i:1:p:95-121
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