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Agricultural Protection in Developing Countries

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  • Lilyan E. Fulginiti
  • Jason F. Shogren

Abstract

Countries often have a Jekyll-Hyde relationship with their agricultural sector – policymakers both tax and subsidize agriculture. In the early stages of a country's development, policy makers exploit agriculture through export taxes and overvalued exchange rates. In contrast, agricultural policy in advanced industrial countries has strongly protected domestic producers by means of trade restrictions, direct price or income supports, and public investment. This paper explores why farmers are taxed in poor countries and subsidized in rich countries. Using the economic theory of contests to come to an understanding of the incentives for agricultural protectionism, we first sketch a framework for an excludable and rivalrous rent. We then apply this framework to agricultural protectionism in developing countries.

Suggested Citation

  • Lilyan E. Fulginiti & Jason F. Shogren, 1994. "Agricultural Protection in Developing Countries," Center for Agricultural and Rural Development (CARD) Publications 94-gatt13, Center for Agricultural and Rural Development (CARD) at Iowa State University.
  • Handle: RePEc:ias:cpaper:94-gatt13
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    Cited by:

    1. John C. Beghin & William E. Foster & Mylene Kherallah, 1996. "Institutions And Market Distortions: International Evidence For Tobacco," Journal of Agricultural Economics, Wiley Blackwell, vol. 47(1-4), pages 355-365.
    2. Swinnen, Johan F. M. & Banerjee, Anurag N. & Gorter, Harry de, 2001. "Economic development, institutional change, and the political economy of agricultural protection: An econometric study of Belgium since the 19th century," Agricultural Economics, Blackwell, vol. 26(1), pages 25-43, October.
    3. Barrett, Christopher B., 1999. "The microeconomics of the developmental paradox: on the political economy of food price policy," Agricultural Economics, Blackwell, vol. 20(2), pages 159-172, March.
    4. Clas Eriksson, 2011. "Home bias in preferences and the political economics of agricultural protection," Review of Agricultural and Environmental Studies - Revue d'Etudes en Agriculture et Environnement, INRA Department of Economics, vol. 92(1), pages 5-23.
    5. Florent Venayre, 2012. "Protection du marché agricole et qualité sanitaire en Polynésie française," Post-Print halshs-00785749, HAL.

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