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Cost of the U.S. Sugar Program Revisited, The

Using a multimarket model of U.S. sweeteners, the authors revisit the cost of the U.S. sugar program by analyzing the welfare implications of its removal. Their approach addresses the industrial organization of food industries that use sweeteners and treats the United States as a large importer. The authors estimate that, with the removal of the U.S. sugar program, cane growers, sugar beet growers, and beet processors would lose, respectively, $307 million, $650 million, and $89 million. Sweetener users would gain $1.9 billion. The deadweight loss of the current sugar program would be $532 million (all estimates are based on 1999 prices). World prices would increase by 13.2 percent with the removal of the program.

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Paper provided by Food and Agricultural Policy Research Institute (FAPRI) at Iowa State University in its series Food and Agricultural Policy Research Institute (FAPRI) Publications with number 01-wp273.

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Date of creation: Mar 2001
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Handle: RePEc:ias:fpaper:01-wp273
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  1. GianCarlo Moschini, 1991. "Economic Issues in Tariffication: An Overview," Food and Agricultural Policy Research Institute (FAPRI) Publications 90-gatt1, Food and Agricultural Policy Research Institute (FAPRI) at Iowa State University.
  2. Sumner, Daniel A., 2000. "Domestic support and the WTO negotiations," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 44(3), September.
  3. Chad E. Hart & Bruce A. Babcock, 2001. "Implications of the WTO on the Redesign of U.S. Farm Policy," Food and Agricultural Policy Research Institute (FAPRI) Publications 01-bp32, Food and Agricultural Policy Research Institute (FAPRI) at Iowa State University.
  4. Rendleman, C. Matthew & Hertel, Thomas W., 1993. "Do Corn Farmers Have Too Much Faith In The Sugar Program?," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 18(01), July.
  5. Sanjib Bhuyan & Rigoberto A. Lopez, 1997. "Oligopoly Power in the Food and Tobacco Industries," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(3), pages 1035-1043.
  6. Poonyth, Daneswar & Westhoff, Patrick & Womack, Abner & Adams, Gary, 2000. "Impacts of WTO restrictions on subsidized EU sugar exports," Agricultural Economics, Blackwell, vol. 22(3), pages 233-245, April.
  7. Haley, Stephen L., 1998. "Modeling The U.S. Sweetener Sector: An Application To The Analysis Of Policy Reform," Working Papers 14610, International Agricultural Trade Research Consortium.
  8. Poonyth, Daneswar & Westhoff, Patrick & Womack, Abner & Adams, Gary, 2000. "Impacts of WTO restrictions on subsidized EU sugar exports," Agricultural Economics of Agricultural Economists, International Association of Agricultural Economists, vol. 22(3), April.
  9. Gardner Bruce, 2007. "Fuel Ethanol Subsidies and Farm Price Support," Journal of Agricultural & Food Industrial Organization, De Gruyter, vol. 5(2), pages 1-22, December.
  10. Devadoss, Stephen & Kropf, Jurgen & Wahl, Thomas I., 1995. "Trade Creation And Diversion Effects Of The North American Free Trade Agreement Of U.S. Sugar Imports From Mexico," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 20(02), December.
  11. Catherine J. Morrison, 1990. "Market Power, Economic Profitability and Productivity Growth Measurement: An Integrated Structural Approach," NBER Working Papers 3355, National Bureau of Economic Research, Inc.
  12. S. McCorriston & C. W. Morgan & A. J. Rayner, 1998. "Processing Technology, Market Power and Price Transmission," Journal of Agricultural Economics, Wiley Blackwell, vol. 49(2), pages 185-201.
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