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World Tariff Liberalization in Agriculture: An Assessment Following a Global CGE Trade Model for EU15 Regions

Author

Listed:
  • Gabriele Standardi

    (Fondazione Eni Enrico Mattei)

  • Federico Perali

    (University of Verona, Department of Economic Sciences)

  • Luca Pieroni

    (University of Perugia, Department of Economics, Finance and Statistics)

Abstract

This paper aims at modeling a global CGE trade model for the EU15 subnational regions. This model is used to assess production reallocation across sectors in each EU15 region, assuming a scenario in which world tariff liberalization is implemented in the agricultural sector. The model is parsimonious in terms of data, focusing on unskilled and skilled labor as the source of heterogeneity across regions. A stylized model is built to interpret trade policy effects. Results show decreases in agricultural production in the EU15 of about 0.93%. All regions reduce agriculture but show different magnitudes in the relative changes of production. Large reallocation effects are observed between manufactures and services, some regions specializing in the former and others in the latter. In addition, the introduction of labor mobility within the EU15 and the EU27 causes strong amplification effects in manufactures and services.

Suggested Citation

  • Gabriele Standardi & Federico Perali & Luca Pieroni, 2014. "World Tariff Liberalization in Agriculture: An Assessment Following a Global CGE Trade Model for EU15 Regions," Working Papers 2014.25, Fondazione Eni Enrico Mattei.
  • Handle: RePEc:fem:femwpa:2014.25
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    References listed on IDEAS

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    More about this item

    Keywords

    CGE modeling; International trade; Agriculture;

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
    • Q17 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agriculture in International Trade

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