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Tariff protection elimination and Common Agricultural Policy reform: implications of changes in methods of import demand modelling

  • Alexandre Gohin
  • Herve Guyomard
  • Chantal Le Mou�l

The study proposes a way for accommodating the traditional Armington assumption to capture the possibility for a country to import imperfect substitutes as well as perfect substitutes for domestically produced goods. When this possibility is incorporated into a modelling framework, then a Common Agricultural Policy elimination scenario, including the setting to zero of import tariffs, would have starker implications than many studies suggest. To illustrate this point, a Computable General Equilibrium (CGE) model of the French economy is used, highlighting agricultural and food sectors. The study analyses the consequences for the French economy of a complete liberalization scenario in the European sector of cereals.

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Article provided by Taylor & Francis Journals in its journal Applied Economics.

Volume (Year): 38 (2006)
Issue (Month): 13 ()
Pages: 1527-1539

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Handle: RePEc:taf:applec:v:38:y:2006:i:13:p:1527-1539
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  1. Rutherford, Thomas F., 1995. "Extension of GAMS for complementarity problems arising in applied economic analysis," Journal of Economic Dynamics and Control, Elsevier, vol. 19(8), pages 1299-1324, November.
  2. Swinbank, Alan, 1999. "CAP Reform and the WTO: Compatibility and Developments," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 26(3), pages 389-407, August.
  3. Morris Morkre & David Tarr, 1995. "Reforming Hungarian agricultural trade policy: A quantitative evaluation," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 131(1), pages 106-131, March.
  4. Harrison, Glenn W. & Rutherford, Thomas F. & Wooton, Ian, 1995. "Liberalizing agriculture in the European union," Journal of Policy Modeling, Elsevier, vol. 17(3), pages 223-255, June.
  5. Hertel, Thomas W & Tsigas, Marinos E, 1991. "General Equilibrium Analysis of Supply Control in U.S. Agriculture," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 18(2), pages 167-91.
  6. Shoven, John B & Whalley, John, 1984. "Applied General-Equilibrium Models of Taxation and International Trade: An Introduction and Survey," Journal of Economic Literature, American Economic Association, vol. 22(3), pages 1007-51, September.
  7. Löfgren, Hans & Robinson, Sherman, 1997. "The Mixed-Complementarity Approach to Specifying Agricultural Supply in Computable General Equilibrium Models," 1997 Conference, August 10-16, 1997, Sacramento, California 197058, International Association of Agricultural Economists.
  8. Anderson, Kym & Hoekman, Bernard & Strutt, Anna, 2001. "Agriculture and the WTO: Next Steps," Review of International Economics, Wiley Blackwell, vol. 9(2), pages 192-214, May.
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