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Welfare Analysis of the U.S.-Mexican Tomato Suspension Agreement

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  • Kosse, Elijah
  • Devadoss, Stephen

Abstract

This study develops a three-county trade model of the United States, Mexico, and Canada to analyze the effects of the 2013 Suspension Agreement on prices, production, consumption, trade flows, and welfare in each country due to the U.S. minimum import price on Mexican tomatoes. While only the United States and Mexico are signatories to the agreement, Canada was also included since the U.S. minimum price distorts prices across the region. Three tomato categories—field, greenhouse, and cherry & grape—are studied since each has a distinct minimum price. The overall welfare effects are positive for Mexico and Canada, but negative for the United States.

Suggested Citation

  • Kosse, Elijah & Devadoss, Stephen, 2016. "Welfare Analysis of the U.S.-Mexican Tomato Suspension Agreement," 2017 Annual Meeting, February 4-7, 2017, Mobile, Alabama 252726, Southern Agricultural Economics Association.
  • Handle: RePEc:ags:saea17:252726
    DOI: 10.22004/ag.econ.252726
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    References listed on IDEAS

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    1. Johnecheck, Wendy A. & Wilde, Parke E. & Caswell, Julie A., 2010. "Market and Welfare Impacts of COOL on the U.S.-Mexican Tomato Trade," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 35(3), pages 1-19, December.
    2. Baylis, Katherine R., 2003. "Dispatches From The Tomato Wars: Spillover Effects Of Trade Barriers," Working Papers 15850, University of British Columbia, Food and Resource Economics.
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    4. Calvin, Linda & Barrios, Veronica, 1999. "Marketing Winter Vegetables From Mexico," Journal of Food Distribution Research, Food Distribution Research Society, vol. 30(1), pages 1-13, March.
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    6. Kathy Baylis & Jeffrey M. Perloff, 2010. "Trade diversion from tomato suspension agreements," Canadian Journal of Economics, Canadian Economics Association, vol. 43(1), pages 127-151, February.
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    8. Padilla-Bernal, Luz E. & Thilmany, Dawn D., 2000. "Mexican-U.S. Fresh Tomato Trade: An Analysis Of Volume, Prices And Transaction Costs," 2000 Annual Meeting, June 29-July 1, 2000, Vancouver, British Columbia 36445, Western Agricultural Economics Association.
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    Cited by:

    1. Colin A. Carter & Tina L. Saitone & K. Aleks Schaefer, 2019. "Managed trade: The USMexico sugar suspension agreements," Canadian Journal of Economics, Canadian Economics Association, vol. 52(3), pages 1195-1222, August.

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