Changing contributions of different agricultural policy instruments to global reductions in trade and welfare

Johanna Croser*, Kym Anderson

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

14 Citations (Scopus)

Abstract

Trade negotiators and policy advisors are keen to know the relative contributions of different farm policy instruments to international trade and economic welfare. Nominal rates of assistance or producer support estimates are incomplete indicators, especially when (as in many developing countries) some commodities are taxed and others are subsidized, in which case positive contributions can offset negative contributions. This paper develops and estimates a new set of more-satisfactory partial equilibrium indicators of the relative contribution of different farm policy instruments to reductions in agricultural trade and welfare. It does so by drawing on the trade restrictiveness index literature and a recently compiled database on distortions to agricultural prices for 75 developing and high-income countries over the period 1960 to 2004. Results confirm earlier findings that border taxes are the dominant instrument affecting global trade and welfare, but they also suggest declines in export taxes contributed nearly as much as cuts in import protection to the trade and welfare effects of agricultural policy reforms since the 1980s.

Original languageEnglish
Pages (from-to)297-323
Number of pages27
JournalWorld Trade Review
Volume10
Issue number3
DOIs
Publication statusPublished - Jul 2011
Externally publishedYes

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