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The potential cost of a Failed Doha Round

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  • Antoine Bouët

    (IFPRI - International Food Policy Research Institute [Washington] - CGIAR - Consultative Group on International Agricultural Research [CGIAR], CATT - Centre d'Analyse Théorique et de Traitement des données économiques - UPPA - Université de Pau et des Pays de l'Adour)

  • David Laborde

    (CATT - Centre d'Analyse Théorique et de Traitement des données économiques - UPPA - Université de Pau et des Pays de l'Adour)

Abstract

This study offers new conclusions on the economic cost of a failed Doha Round. The first section is devoted to an analysis of how trade policies evolve in the long and medium runs. We show that even under normal economic conditions, policymakers modify tariffs to cope with the evolution of world markets. We then use the MIRAGE Computable General Equilibrium model to assess the potential outcome of the Doha Round, and then examine four protectionist scenarios. Under a scenario where applied tariffs of major economies increase up to the currently bound tariff rates, we find that world trade decreases by 7.7 percent and world welfare drops by US353 bn. We then compare a resort to protectionism when the Doha Development Agenda (DDA) is implemented versus a resort to protectionism when the DDA is not implemented. We find that this trade agreement could prevent the potential loss of US 809 bn of trade, and could therefore act as an efficient multilateral insurance scheme against the adverse consequences of "beggar-thy-neighbor" trade policies.

Suggested Citation

  • Antoine Bouët & David Laborde, 2009. "The potential cost of a Failed Doha Round," Working papers of CATT hal-01885165, HAL.
    • Handle: RePEc:hal:wpcatt:hal-01885165
    Note: View the original document on HAL open archive server: https://hal-univ-pau.archives-ouvertes.fr/hal-01885165
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    Cited by:

    1. Willenbockel, Dirk, 2009. "From overhang to hangover: consequences of protectionist responses to the global crisis for low-income countries," MPRA Paper 16100, University Library of Munich, Germany.
    2. Patrick Messerlin & Erik Van Der Marel, 2009. "'Leading with Services': The Dynamics of Transatlantic Negotiations in Services," Sciences Po publications info:hdl:2441/5l6uh8ogmqi, Sciences Po.
    3. Sebastian Saez, 2009. "Managing Trade Policy During the Economic Crisis," World Bank Publications - Reports 11113, The World Bank Group.
    4. Patrick Messerlin, 2009. "The world trade regime, the WTO and large scale crises: Perspectives after the Pittsburg G20 Summit," Sciences Po publications info:hdl:2441/5l6uh8ogmqi, Sciences Po.
    5. Patrick Messerlin, 2010. "The Doha Round," SciencePo Working papers Main hal-00972939, HAL.
    6. Sulser, T. B., 2009. "Green and blue water accounting in the Limpopo and Nile basins: implications for food and agricultural policy," IWMI Working Papers H042476, International Water Management Institute.
    7. Popa, Diana, 2011. "Runda Doha: început fără sfârşit [Doha Round: the endless beginning]," MPRA Paper 28764, University Library of Munich, Germany, revised 09 Feb 2011.
    8. United Nations ESCAP (ed.), 2011. "Asia-Pacific Trade and Investment Report 2011: Post-crisis trade and investment opportunities," STUDIES IN TRADE AND INVESTMENT, United Nations Economic and Social Commission for Asia and the Pacific (ESCAP), number aptir2596, April.
    9. Decreux, Yvan & Fontagné, Lionel, 2011. "Economic Impact of Potential Outcome of the DDA," Conference papers 332090, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    10. Métivier, Jeanne & Bacchetta, Marc & Bekkers, Eddy & Koopman, Robert Bernard, 2023. "International trade cooperation's impact on the world economy," WTO Staff Working Papers ERSD-2023-02, World Trade Organization (WTO), Economic Research and Statistics Division.
    11. repec:spo:wpecon:info:hdl:2441/5l6uh8ogmqildh09h2q4n8g45 is not listed on IDEAS
    12. repec:hal:spmain:info:hdl:2441/5l6uh8ogmqildh09h2q4jah34 is not listed on IDEAS
    13. Bouët, Antoine & Laborde Debucquet, David, 2017. "Why is the Doha Development agenda failing? And what can be done? A computable general equilibrium-game theoretical approach :," IFPRI book chapters, in: Bouët, Antoine & Laborde Debucquet, David (ed.), Agriculture, development, and the global trading system: 2000– 2015, chapter 3, International Food Policy Research Institute (IFPRI).
    14. Métivier, Jeanne & Bacchetta, Marc & Bekkers, Eddy & Koopman, Robert, 2023. "International trade cooperation’s impact on the world economy," Journal of Policy Modeling, Elsevier, vol. 45(4), pages 713-744.
    15. Wang, Qian, 2010. "Sources of Economic Fluctuations in East Asia from 1980 to 2006—Analysis Based on Panel VAR," Conference papers 331922, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    16. Patrick Messerlin, 2009. "The world trade regime, the WTO and large scale crises: Perspectives after the Pittsburg G20 Summit," SciencePo Working papers Main hal-01053280, HAL.
    17. Patrick Messerlin, 2009. "The world trade regime, the WTO and large scale crises: Perspectives after the Pittsburg G20 Summit," Post-Print hal-01053280, HAL.
    18. Patrick A. Messerlin, 2011. "World trade regime, World Trade Organization and large-schale crises," STUDIES IN TRADE AND INVESTMENT, in: Trade-led growth: A sound strategy for Asia, chapter 2, United Nations Economic and Social Commission for Asia and the Pacific (ESCAP).
    19. Diana Popa, 2012. "The Collapse of the Doha Round and a Possible Completion of Negotiations," Romanian Economic Journal, Department of International Business and Economics from the Academy of Economic Studies Bucharest, vol. 15(43), pages 165-188, March.
    20. repec:hal:spmain:info:hdl:2441/5l6uh8ogmqildh09h2q4n8g45 is not listed on IDEAS
    21. repec:hal:wpspec:info:hdl:2441/5l6uh8ogmqildh09h2q4n8g45 is not listed on IDEAS
    22. Wolfe, Robert, 2010. "Endogenous Learning and Consensual Understanding in Multilateral Negotiations: Arguing and Bargaining in the WTO," Working Papers 90885, Canadian Agricultural Trade Policy Research Network.

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    More about this item

    Keywords

    Domestic support; Bound duties; Trade negociations; CGE modeling;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion and Avoidance
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law

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