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Dynamic modelling of agricultural policies: the role of expectation schemes

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  • Femenia, Fabienne
  • Alexandre, Gohin

Abstract

The highly disputed effects of agricultural trade liberalisation are mostly simulated with static models. Our main objective in this paper is to evaluate the robustness of the static simulation results to the consistent modelling of dynamic behaviours and to the linked specification of price/return expectations. Focusing on a complete trade liberalisation scenario of arable crop markets by developed countries, we find that available static results are quite robust to dynamic specifications and to most expectation schemes. Endogenous market fluctuations due to expectation errors may appear following trade liberalisation. These fluctuations are nevertheless limited by the many feedback effects revealed by our general equilibrium framework.

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File URL: http://purl.umn.edu/51665
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Paper provided by International Association of Agricultural Economists in its series 2009 Conference, August 16-22, 2009, Beijing, China with number 51665.

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Date of creation: 2009
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Handle: RePEc:ags:iaae09:51665
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Keywords: Agricultural policy; Dynamics; Endogenous fluctuations; Expectation errors; Agricultural and Food Policy; Risk and Uncertainty;

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Cited by:

  1. Femenia, Fabienne, 2012. "Should private storage be subsidized to stabilize agricultural markets after price support schemes are removed?:," IFPRI discussion papers 1205, International Food Policy Research Institute (IFPRI).
  2. Femenia, Fabienne, 2011. "To Subsidize or Not to Subsidize Private Storage? Evaluation of the Effects of Private Storage Subsidies as an Instrument to Stabilize Agricultural Markets After CAP Reforms," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114360, European Association of Agricultural Economists.
  3. Femenia, Fabienne, 2010. "Impacts of Stockholding Behaviour on Agricultural Market Volatility: A Dynamic Computable General Equilibrium Approach," Journal of International Agricultural Trade and Development, Journal of International Agricultural Trade and Development, vol. 59(3).

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