Working Paper: CEPR ID: DP5337
Authors: Kym Anderson; Ernesto Valenzuela
Abstract: We estimate the impact of global merchandise trade distortions and services regulations on agricultural value added in various countries. Using the latest versions of the GTAP database and the GTAP-AGR model of the global economy, our results suggest real net farm incomes would rise in developing countries with a move to free trade, thereby alleviating rural poverty - despite a terms of trade deterioration for developing countries that are net food importers or are enjoying preferential access to agricultural markets of high-income countries. We also show, for several large developing countries, the contribution of their own versus other countries' trade policies
Keywords: Agricultural value added; CGE modelling; Economic welfare; Trade policy reform
JEL Codes: C68; D58; F17; Q17
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Removal of global trade distortions (F13) | Increase in agricultural value added in developing countries (O13) |
| Removal of global trade distortions (F13) | Increase in net farm incomes in developing countries (O13) |
| Removal of agricultural tariffs in high-income countries (Q17) | Increase in developing country farm incomes (O13) |
| Domestic policy distortions in developing countries (F68) | Hinder net farm incomes (Q12) |