IDEAS home Printed from https://ideas.repec.org/p/isu/genstf/198701010800009612.html
   My bibliography  Save this paper

EC common agricultural policy and the world trade in feed grain: a multi-region nonspatial price equilibrium analysis

Author

Listed:
  • Bahreinian, Aniss

Abstract

Since the adoption of the Common Agricultural Policy in 1962, the members of the European Economic Community have protected their common borders against the importation of certain agricultural commodities. Heavy variable levies and high guaranteed producer prices have triggered rise in market prices followed by a rise in grain production in EC countries. Therefore, the number one grain importing region of the 1960s has transformed into a major grain exporting region of the 1980s. These developments led to many objections from the grain exporting countries, followed by bilateral and multilateral negotiations, with little if any success;The general concern of this study is the impact of alternative less protective EC feed grain policies, on the prices and quantities traded by the major trading partners in the world feed grain market. The feed grain market is chosen primarily because the EC has turned into a net exporter of feed grains, only in the mid-1980s. Besides, the wheat market with the longest standing problem of surplus production has been extensively covered by other studies;This study analyzes several scenarios, each of which adopts one of the following policies: nominal or real threshold prices are kept constant, the policy prices are gradually reduced, producers are subsidized while the import market is kept free, and, finally, the protection rates in feed grain and soybean markets are harmonized. The estimation period covers the years 1968-1982, while the policy impacts are simulated until 1989;In conclusion, the policy changes studied here are not suggested to cause a significant development in the imports of the importing regions. On the export side, the most extreme of the policy changes analyzed in the study appears to increase U.S. exports only by five percent, while only one of the other exporting countries' export increases by as much as 20 percent.

Suggested Citation

  • Bahreinian, Aniss, 1987. "EC common agricultural policy and the world trade in feed grain: a multi-region nonspatial price equilibrium analysis," ISU General Staff Papers 198701010800009612, Iowa State University, Department of Economics.
  • Handle: RePEc:isu:genstf:198701010800009612
    as

    Download full text from publisher

    File URL: https://dr.lib.iastate.edu/server/api/core/bitstreams/0d3d3cb4-930e-4d64-abe8-17edfaf99ec8/content
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Rastegari, Shida, 1982. "Feed grains imports and pricing in the European Economic Community," ISU General Staff Papers 198201010800008476, Iowa State University, Department of Economics.
    2. Gallagher, Paul W. & Houck, James P., 1976. "The Price Responsiveness of U.S. Corn Yields," Staff General Research Papers Archive 12563, Iowa State University, Department of Economics.
    3. Cavallo, Domingo & Mundlak, Yair, 1982. "Agriculture and economic growth in an open economy: the case of Argentina," Research reports 36, International Food Policy Research Institute (IFPRI).
    4. James P. Houck & Paul W. Gallagher, 1976. "The Price Responsiveness of U.S. Corn Yields," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 58(4_Part_1), pages 731-734.
    5. Amemiya, Takeshi, 1974. "The nonlinear two-stage least-squares estimator," Journal of Econometrics, Elsevier, vol. 2(2), pages 105-110, July.
    6. Sujit K. Roy & M. Edwin Ireland, 1975. "An Econometric Analysis of the Sorghum Market," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 57(3), pages 513-516.
    7. Valdés, Alberto & Zietz, Joachim A., 1980. "Agricultural protection in OECD countries: its cost to less-developed countries," Research reports 21, International Food Policy Research Institute (IFPRI).
    8. Kelch, David R., 1982. "Structural and Commodity Policies of Spanish Agriculture," Foreign Agricultural Economic Report (FAER) 147192, United States Department of Agriculture, Economic Research Service.
    9. Mielke, Myles J., 1984. "Argentine Agricultural Policies in the Grain and Oilseed Sectors," Foreign Agricultural Economic Report (FAER) 147524, United States Department of Agriculture, Economic Research Service.
    10. Maury E. Bredahl & Leonardo Green, 1983. "Residual Supplier Model of Coarse Grains Trade," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 65(4), pages 785-790.
    11. Jabara, Cathy L. & Brigida, Alan S., 1980. "Variable Levies: Barriers to Grain Imports in France, the Netherlands, Federal Republic of Germany, and United Kingdom," Foreign Agricultural Economic Report (FAER) 146904, United States Department of Agriculture, Economic Research Service.
    12. Coyle, William T., 1983. "Japan's Feed-Livestock Economy: Prospects for the 1980's," Foreign Agricultural Economic Report (FAER) 147197, United States Department of Agriculture, Economic Research Service.
    13. Bahrenian, Aniss & Meyers, William H., 1986. "EC Trade Liberalization and World Trade in Feed Grains: A Comparison and A Criticism," 1986 Annual Meeting, July 27-30, Reno, Nevada 278078, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    14. Petit, Michel, 1985. "Determinants of agricultural policies in the United States and the European Community:," Research reports 51, International Food Policy Research Institute (IFPRI).
    15. F. Peterson, E. Wesley & Auerbach, Mitchell, 1985. "Consequences of the Imposition of Import Duties on Soybeans by the European Community," Staff Paper Series 257977, Texas A&M University, Department of Agricultural Economics.
    16. Maury E. Bredahl & William H. Meyers & Keith J. Collins, 1979. "The Elasticity of Foreign Demand for U.S. Agricultural Products: The Importance of the Price Transmission Elasticity," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 61(1), pages 58-63.
    17. Spriggs, John, 1978. "An Econometric Analysis of Export Supply of Grains in Australia," Foreign Agricultural Economic Report (FAER) 146882, United States Department of Agriculture, Economic Research Service.
    18. Aniss Bahrenian & William H. Meyers, 1986. "EC Trade Liberalization and World Trade in Feed Grains: A Comparison and A Criticism," Center for Agricultural and Rural Development (CARD) Publications 86-wp13, Center for Agricultural and Rural Development (CARD) at Iowa State University.
    19. Alan Swinbank, 1980. "European Community Agriculture and the World Market," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 62(3), pages 426-433.
    20. Gordon C. Rausser & D. Peter Stonehouse, 1978. "Public Intervention and Producer Supply Response," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 60(5), pages 885-890.
    21. Mahama, Ramatu, 1985. "A stochastic simulation of the impact of price insulation policies on world wheat market stability," ISU General Staff Papers 198501010800008868, Iowa State University, Department of Economics.
    22. Huyser, Wipada Soonthornsima, 1983. "A regional analysis of trade policies affecting the soybean and soymeal market," ISU General Staff Papers 198301010800008638, Iowa State University, Department of Economics.
    23. Aniss Bahrenian & William H. Meyers, 1986. "EC Trade Liberalization and World Trade in Feed Grains: A Comparison and A Criticism," Food and Agricultural Policy Research Institute (FAPRI) Publications (archive only) 86-wp13, Center for Agricultural and Rural Development (CARD) at Iowa State University.
    24. Colin Carter & Andrew Schmitz, 1979. "Import Tariffs and Price Formation in the World Wheat Market," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 61(3), pages 517-522.
    25. Gerald Pollio & Charles H. Riemenschneider, 1985. "Harmonizing european community farm policy: Agribusiness implications," Agribusiness, John Wiley & Sons, Ltd., vol. 1(2), pages 137-151.
    26. Josling, Timothy, 1980. "Developed-country agricultural policies and developing-country food supplies: the case of wheat," Research reports 14, International Food Policy Research Institute (IFPRI).
    27. Meilke, Karl D. & de Gorter, Harry, 1985. "An Econometric Model of the European Economic Community's Wheat Sector," Working Papers 147114, University of Guelph, Department of Food, Agricultural and Resource Economics.
    28. Harald Witzke, 1986. "Endogenous supranational policy decisions: The Common Agricultural Policy of the European Community," Public Choice, Springer, vol. 48(2), pages 157-174, January.
    29. John Spriggs & G. C. Van Kooten & Keith Hayward, 1984. "Canadian Feed Grains Policy: A Comparison of Price Variability Between Canada and the United States," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 32(3), pages 540-547, November.
    30. Jabara, Cathy L., 1981. "Trade Restrictions in International Grain and Oilseed Markets: A Comparative Country Analysis," Foreign Agricultural Economic Report (FAER) 146909, United States Department of Agriculture, Economic Research Service.
    31. Koester, Ulrich, 1982. "Policy options for the grain economy of the European Community: implications for developing countries," Research reports 35, International Food Policy Research Institute (IFPRI).
    32. Bray, Carol E., 1978. "Canadian Feed Grain Policy," Foreign Agricultural Economic Report (FAER) 146874, United States Department of Agriculture, Economic Research Service.
    33. Runge, C. Ford & von Witzke, Harald, 1985. "Institutional Innovation In The Common Agricultural Policy Of The European Community," Staff Papers 14170, University of Minnesota, Department of Applied Economics.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Denbaly, Massoud Said Mark, 1984. "U. S. monetary policy and the exchange rate: effects on the world coarse grain market," ISU General Staff Papers 198401010800008753, Iowa State University, Department of Economics.
    2. Mahama, Ramatu, 1985. "A stochastic simulation of the impact of price insulation policies on world wheat market stability," ISU General Staff Papers 198501010800008868, Iowa State University, Department of Economics.
    3. Liu, Zong-Shin, 1989. "Monetary policy, exchange rate, and effects on US wheat trade and domestic market in an imperfect competition framework," ISU General Staff Papers 1989010108000010216, Iowa State University, Department of Economics.
    4. Awad, Taleb Mohammad, 1987. "International monetary and exchange rate policies and world agricultural markets: the case of soybeans and soybean products," ISU General Staff Papers 198701010800009611, Iowa State University, Department of Economics.
    5. Liu, Hsiang-Hsi, 1983. "An annual simultaneous equation econometric model of U.S. corn and soybean cash and futures markets," ISU General Staff Papers 198301010800009935, Iowa State University, Department of Economics.
    6. Conway, Roger K., 1985. "Examining Intertemporal Export Elasticities for Wheat, Corn, and Soybeans: A Stochastic Coefficients Approach," Technical Bulletins 157006, United States Department of Agriculture, Economic Research Service.
    7. Fulginiti, Lilyan E. & Perrin, Richard K., 1987. "Argentine Agricultural Structure and Policy Implications," 1989 Occasional Paper Series No. 5 197659, International Association of Agricultural Economists.
    8. Grosskopf, W. & Tangermann, S., 1981. "EG-Erweiterung und Weltagrarmärkte," Proceedings “Schriften der Gesellschaft für Wirtschafts- und Sozialwissenschaften des Landbaues e.V.”, German Association of Agricultural Economists (GEWISOLA), vol. 18.
    9. Liapis, Peter S., 1989. "Estimation and Evaluation of Economic Community Wheat Export Subsidies," Staff Reports 278253, United States Department of Agriculture, Economic Research Service.
    10. Dean A. DeRosa, 1996. "Regionalism and the Bias Against Agriculture in Less Developed Countries," The World Economy, Wiley Blackwell, vol. 19(Supplemen), pages 45-66, November.
    11. von Witzke, Harald & Houck, James P., 1987. "Economic Effects Of Possible European Community Market Intervention In Soybeans And Their Products," Staff Papers 14147, University of Minnesota, Department of Applied Economics.
    12. Jeon, Jong-Pyeong, 1989. "The impacts of policy alternatives and foreign demand fluctuations on the US rice market," ISU General Staff Papers 1989010108000010204, Iowa State University, Department of Economics.
    13. David Colman, 1989. "La politique agricole commune en conflit avec le commerce et le développement," Économie rurale, Programme National Persée, vol. 189(1), pages 7-13.
    14. Sharples, Jerry A., 1981. "Crops For Food Or Fuel: An Estimate Of The Tradeoff," 1981 Annual Meeting, July 26-29, Clemson, South Carolina 279387, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    15. Henning, Christian H.C.A. & Glauben, Thomas, 2000. "Dynamik, Dimensionen Und Determinanten Der Gemeinsamen Europäischen Agrarpolitik," Working Paper Series 24406, University of Kiel, Chair of Agricultural Policy.
    16. Jaouad, Mohamed, 1994. "An agricultural policy and trade model for Morocco," ISU General Staff Papers 1994010108000011483, Iowa State University, Department of Economics.
    17. Knudson, Mary & Hansen, LeRoy, 1991. "Intellectual Property Rights and the Private Seed Industry," Agricultural Economic Reports 308158, United States Department of Agriculture, Economic Research Service.
    18. Liu, Karen, 1981. "Multiple Crop Supply and Factor Demand Component of the World Grains, Oilseeds, and Livestock Model," Staff Reports 276718, United States Department of Agriculture, Economic Research Service.
    19. Ekanem, Enefiok P. & Sundquist, W. Burt, 1993. "Estimating Marginal Implicit Prices For Selected Quality Attributes Of Hybrid Seed Corn," Staff Papers 13473, University of Minnesota, Department of Applied Economics.
    20. Jouf, C. & Lawson, L.A., 2022. "European farmers’ responses to higher commodity prices: Cropland expansion or forestlands preservation?," Ecological Economics, Elsevier, vol. 191(C).

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:isu:genstf:198701010800009612. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Curtis Balmer (email available below). General contact details of provider: https://edirc.repec.org/data/deiasus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.