Agriculture in the Age of Globalization
This paper aims at analyzing the asymmetries in the process of globalization and its differentiated outcomes on (i) developed and less developed countries, and (ii) on LDC agriculture. The consequences of these asymmetries are reflected in the dramatic changes in world agricultural trade an unprecedented growth of agricultural trade in real terms and a dramatic change in its composition which is increasingly moving away from bulk commodities towards high-value, processed consumer-ready agricultural goods. The impacts of these changes on LDC agriculture have been quite differentiated, with most countries experiencing a worsening of their agricultural trade balance. This change of the LDC trade position is counterintuitive if we still think of agricultural trade as a comparative-advantage-based trade, i.e. based on cost competition. It seems instead that the change in the composition of agricultural trade is the epiphenomenon of a fundamental change in the rules of the game, which are increasingly based on the reputation of agricultural products and imply a quality-based competition. Unfortunately, the implications for LDC agriculture do not seem encouraging. The intrinsic poverty of these economies, with the implied burden in terms of missing assets to compete under the new rules of the game and some adverse globalization-induced changes in LDCs macro fundamentals, are crucial handicaps that work against the development of LDC agriculture. Furthermore, the underlying forces driving globalization (increasing returns to scale, research, development of new products, etc.) undermine the traditional role of agriculture as engine of growth. The analysis carried out in this paper represents one more piece of evidence that the effects of globalization are asymmetric and that development success requires selective and phased integration with world markets. Without the required investments in terms of infrastructure, institutions, human and social capital, LDC agriculture will hardly be able to claim the expected benefits of globalization.
|Date of creation:||2006|
|Date of revision:|
|Contact details of provider:|| Web page: http://www.iaae-agecon.org/|
More information through EDIRC
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.:
- Baier, Scott L. & Bergstrand, Jeffrey H., 2001. "The growth of world trade: tariffs, transport costs, and income similarity," Journal of International Economics, Elsevier, vol. 53(1), pages 1-27, February.
- Tony Warren & Gary Clyde Hufbauer & Erika Wada, 2002.
"Benefits of Price Convergence: Speculative Calculations, The,"
Peterson Institute Press: Policy Analyses in International Economics,
Peterson Institute for International Economics, number pa65, February.
- Warren, Tony & Gary Clyde Hufbauer & Erika Wada, 2002. "Benefits of Price Convergence: Speculative Calculations, The," Peterson Institute Press: All Books, Peterson Institute for International Economics, number pa65.
- Robert C. Feenstra, 1998.
"Integration of Trade and Disintegration of Production in the Global Economy,"
Journal of Economic Perspectives,
American Economic Association, vol. 12(4), pages 31-50, Fall.
- Robert Feenstra, 2003. "Integration Of Trade And Disintegration Of Production In The Global Economy," Working Papers 986, University of California, Davis, Department of Economics.
- Robert C. Feenstra, . "Integration Of Trade And Disintegration Of Production In The Global Economy," Department of Economics 98-06, California Davis - Department of Economics.
- Thomas W. Hertel & Zhi Wang & Wusheng Yu, 1998.
"Understanding the Determinants of Structural Change in World Food Markets,"
American Journal of Agricultural Economics,
Agricultural and Applied Economics Association, vol. 80(5), pages 1051-1061.
- Coyle, William T. & Mark Gehlhar & Thomas W. Hertel & Zhi Wang & Wusheng Yu, 1998. "Understanding the Determinants of structural Change in World Food Markets," GTAP Working Papers 260, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University.
- Leon, Javier & Soto, Raimundo, 1995.
"Structural breaks and long-run trends in commodity prices,"
Policy Research Working Paper Series
1406, The World Bank.
- Javier Le�N & Raimundo Soto, 1997. "Structural Breaks And Long-Run Trends In Commodity Prices," Journal of International Development, John Wiley & Sons, Ltd., vol. 9(3), pages 347-366.
- David C. Parsley & Shang-Jin Wei, 2001.
"Limiting Currency Volatility to Stimulate Goods Market Integration; A Price-Based Approach,"
IMF Working Papers
01/197, International Monetary Fund.
- David C. Parsley & Shang-Jin Wei, 2001. "Limiting Currency Volatility to Stimulate Goods Market Integration: A Price Based Approach," NBER Working Papers 8468, National Bureau of Economic Research, Inc.
- Parsley, David & Wei, Shang-Jin, 2001. "Limiting Currency Volatility to Stimulate Goods Market Integration: a Price-Based Approach," CEPR Discussion Papers 2958, C.E.P.R. Discussion Papers.
- Yasuyuki Sawada & Pan A. Yotopoulos, 2006. "Growth and Poverty Reduction Under Globalization: The Systematic Impact of Exchange Rate Misalignment," Discussion Papers 06-014, Stanford Institute for Economic Policy Research.
- Dehn, Jan, 2000. "Commodity price uncertainty in developing countries," Policy Research Working Paper Series 2426, The World Bank.
- Pingali, P. L. & Traxler, G., 2002. "Changing locus of agricultural research: will the poor benefit from biotechnology and privatization trends?," Food Policy, Elsevier, vol. 27(3), pages 223-238, June.
- Jan Dehn, 2000. "Commodity price uncertainty in developing countries," CSAE Working Paper Series 2000-12, Centre for the Study of African Economies, University of Oxford.
- Kolleen Rask & Norman Rask, 2004. "Transition Economies and Globalization: Food System Asymmetries on the Path to Free Markets," Working Papers 0410, College of the Holy Cross, Department of Economics.
When requesting a correction, please mention this item's handle: RePEc:ags:iaae06:25253. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search)
If references are entirely missing, you can add them using this form.