Distortions to Agricultural Incentives

Distortions to Agricultural Incentives PDF

Author: Kym Anderson

Publisher: World Bank Publications

Published: 2009

Total Pages: 682

ISBN-13: 0821376667

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This volume in the 'Distortions to Agricultural Incentives' series focus on distortions to agricultural incentives from a global perspective.

Distortions to Agricultural Markets

Distortions to Agricultural Markets PDF

Author: Signe Nelgen

Publisher: Sudwestdeutscher Verlag Fur Hochschulschriften AG

Published: 2012

Total Pages: 312

ISBN-13: 9783838134352

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The thesis analyses the patterns and underlying political economy causes of long-run trends and short-run fluctuations in national distortions to agricultural incentives. It does so by exploiting, revising and expanding a dataset of agricultural distortion measures in developing and developed countries from 1955 to 2004 for developing and 2007 for high-income countries by Anderson and Valenzuela (2008). More specifically, it extends its time period to 2009 for developing countries and 2010 for high-income countries. An essential contribution of the thesis is the update of this database to 2010 in order to capture the most recent international food price spike period. The large dataset makes it possible to analyse insulating behaviour in agricultural markets historically over the past 55 years, and to compare governments' reactions to food market shocks and upwards and downwards price spikes in the most recent years vis-a-vis those in the past. The thesis examines the extent of domestic market insulating behaviour of governments by both food-exporting and food-importing countries. This is because the policies of both country groups contribute substantially to international food price volatility and therefore to economic instability and to trade and welfare fluctuations. The international-to-domestic food price transmission elasticity is used as one indicator of such policy action. The evidence also allows us to test to what extent the policy decisions of governments achieve the goal of protecting domestic producers or consumers from international price spikes in either direction. The results of the analysis are subdivided into the contributions of different regions, country groups and policy instruments. The study also quantifies the extent of the contribution of changes in national agricultural trade restrictions to food price spikes internationally, over and above to the initial exogenous price shock. Reactions of food-exporting and food-importing countries at the same time exacerbate price spikes in international food prices and therefore are a concern for all trading nations because of their nontrivial contribution to domestic and international volatility and uncertainty. To test empirically the political economy causes of such market insulating behaviour of governments, the loss aversion theory of Freund and Oezden (2008), with amendments by Jean, Laborde and Martin (2010) to ensure suitability for agricultural markets, is drawn upon. The focus of this part of the thesis is on the question as to why countries alter assistance levels through variations in trade restrictions to protect one domestic group at the cost to others within the nation, rather than more-direct, more-efficient domestic policy instruments to protect either producers or consumers from price spikes. The final part of the thesis focuses on potential future developments in agricultural market distortions and provides an alternative agricultural protection counterfactual for trade policy modelling than the status quo. After identifying the crucial influencing factors on agricultural distortions in the past, projections of assistance measures are provided for the year 2030. These projections make it possible to model an alternative scenario of the costs based on newly estimated political econometric equations of trade-distorting policies in the future, to compare with one that assumes no future policy changes in their baseline.

The Political Economy of Agricultural Price Distortions

The Political Economy of Agricultural Price Distortions PDF

Author: Kym Anderson

Publisher: Cambridge University Press

Published: 2010-08-30

Total Pages:

ISBN-13: 1139491024

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Despite numerous policy reforms since the 1980s, farm product prices remain heavily distorted in both high-income and developing countries. This book seeks to improve our understanding of why societies adopted these policies, and why some but not other countries have undertaken reforms. Drawing on recent developments in political economy theories and in the generation of empirical measures of the extent of price distortions, the present volume provides both analytical narratives of the historical origins of agricultural protectionism in various parts of the world and a set of political econometric analyses aimed at explaining the patterns of distortions that have emerged over the past five decades. These new studies shed much light on the forces affecting incentives and those facing farmers in the course of national and global economic and political development. They also show how those distortions might change in the future.

Distortions to Agricultural Incentives in Africa

Distortions to Agricultural Incentives in Africa PDF

Author: Kym Anderson

Publisher: World Bank Publications

Published: 2009-03-13

Total Pages: 656

ISBN-13: 9780821376645

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The vast majority of the world s poorest households depend on farming for their livelihoods. During the 1960s and 1970s, most developing countries imposed pro-urban and anti-agricultural policies, while many high-income countries restricted agricultural imports and subsidized their farmers. Both sets of policies inhibited economic growth and poverty alleviation in developing countries. Although progress has been made over the past two decades to reduce those policy biases, many trade- and welfare-reducing price distortions remain between agriculture and other sectors and within the agricultural sector of both rich and poor countries. Comprehensive empirical studies of the disarray in world agricultural markets appeared approximately 20 years ago. Since then, the Organisation for Economic Co-operation and Development has provided estimates each year of market distortions in high-income countries, but there have been no comparable estimates for the world s developing countries. This volume is the third in a series (other volumes cover Asia, Europe s transition economies, and Latin America and the Caribbean) that not only fills that void for recent years but extends the estimates in a consistent and comparable way back in time and provides analytical narratives for scores of countries that shed light on the evolving nature and extent of policy interventions over the past half-century. 'Distortions to Agricultural Incentives in Africa' provides an overview of the evolution of distortions to agricultural incentives caused by price and trade policies in the Arab Republic of Egypt plus 20 countries that account for about of 90 percent of Sub-Saharan Africa s population, farm households, agricultural output, and overall GDP. Sectoral, trade, and exchange rate policies in the region have changed greatly since the 1950s, and there have been substantial reforms since the 1980s. Nonetheless, numerous price distortions in this region remain, others have been added in recent years, and there has also been some backsliding, such as in Zimbabwe. The new empirical indicators in these country studies provide a strong evidence-based foundation for assessing the successes and failures of the past and for evaluating policy options for the years ahead.

Distortions to Agricultural Incentives in Latin America

Distortions to Agricultural Incentives in Latin America PDF

Author: Kym Anderson

Publisher: World Bank Publications

Published: 2008-10-02

Total Pages: 440

ISBN-13: 9780821375143

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The vast majority of the world's poorest households depend on farming for their livelihood. During the 1960s and 1970s, most developing countries imposed pro-urban and anti-agricultural policies, while many high-income countries restricted agricultural imports and subsidized their farmers. Both sets of policies inhibited economic growth and poverty alleviation in developing countries. Although progress has been made over the past two decades to reduce those policy biases, many trade- and welfare-reducing price distortions remain between agriculture and other sectors as well as within the agricultural sector of both rich and poor countries. Comprehensive empirical studies of the disarray in world agricultural markets first appeared approximately 20 years ago. Since then the OECD has provided estimates each year of market distortions in high-income countries, but there has been no comparable estimates for the world's developing countries. This volume is the second in a series (other volumes cover Africa, Asia, and Europe's transition economies) that not only fills that void for recent years but extends the estimates in a consistent and comparable way back in time and provides analytical narratives for scores of countries that shed light on the evolving nature and extent of policy interventions over the past half-century. 'Distortions to Agricultural Incentives in Latin America' provides an overview of the evolution of distortions to agricultural incentives caused by price and trade policies in the economies of South America, plus the Dominican Republic, Nicaragua, and Mexico. Together these countries constitute about 80 percent of the region's population, agricultural output, and overall GDP. Sectoral, trade, and exchange rate policies in the region have changed greatly since the 1950s, and there have been substantial reforms, especially in the 1980s. Nonetheless, numerous price distortions in this region remain, others have been added, and there have even been some policy reversals in recent years. The new empirical indicators in these country studies provide a strong evidence-based foundation for assessing the successes and failures of the past and for evaluating policy options for the years ahead.

Distortions to Agricultural Incentives in Europe's Transition Economies

Distortions to Agricultural Incentives in Europe's Transition Economies PDF

Author: Kym Anderson

Publisher: World Bank Publications

Published: 2008-06-05

Total Pages: 408

ISBN-13: 9780821374207

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The vast majority of the world's poorest households depend on farming for their livelihood. During the 1960s and 1970s, most developing countries imposed pro-urban and anti-agricultural policies, while many high-income countries restricted agricultural imports and subsidized their farmers. Both sets of policies inhibited economic growth and poverty alleviation in developing countries. Although progress has been made over the past two decades to reduce those policy biases, many trade- and welfare-reducing price distortions remain between agriculture and other sectors as well as within the agricultural sector of both rich and poor countries. Comprehensive empirical studies of the disarray in world agricultural markets first appeared approximately 20 years ago. Since then the OECD has provided estimates each year of market distortions in high-income countries, but there has been no comparable estimates for the world's developing countries. This volume is the first in a series (other volumes cover Africa, Asia, and Latin America) that not only fill that void for recent years but extend the estimates in a consistent and comparable way back in time--and provide analytical narratives for scores of countries that shed light on the evolving nature and extent of policy interventions over the past half-century. 'Distortions to Agricultural Incentives in Europe's Transition Economies' provides an overview of the evolution of distortions to agricultural incentives caused by price and trade policies in the economies of Eastern Europe and Central Asia that are transitioning away from central planning. The book includes country and subregional studies of the ten transition economies of Central and Eastern Europe that joined the European Union in 2004 or 2007, of seven other large member countries of the Commonwealth of Independent States, and of Turkey. Together these countries comprise over 90 percent of the Europe and Central Asia region's population and GDP. Sectoral, trade, and exchange rate policies in the region have changed greatly since the dissolution of the Soviet Union in 1991, but price distortions remain. The new empirical indicators in these country studies provide a strong evidence-based foundation for evaluating policy options in the years ahead.

Distortions to Agricultural Incentives in Asia

Distortions to Agricultural Incentives in Asia PDF

Author: Kym Anderson

Publisher: World Bank Publications

Published: 2009-02-04

Total Pages: 608

ISBN-13: 9780821376638

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The vast majority of the world's poorest households depend on farming for their livelihoods. During the 1960s and 1970s, most developing countries imposed pro-urban and anti-agricultural policies, while many high-income countries restricted agricultural imports and subsidized their farmers. Both sets of policies inhibited economic growth and poverty alleviation in developing countries. Although progress has been made over the past two decades to reduce those policy biases, many trade- and welfare-reducing price distortions remain between agriculture and other sectors and within the agricultural sector of both rich and poor countries. Comprehensive empirical studies of the disarray in world agricultural markets appeared approximately 20 years ago. Since then, the Organisation for Economic Co-operation and Development had provided estimates each year of market distortions in high-income countries, but there have been no comparable estimates for the world's developing countries. This volume is the third in a series (other volumes cover Africa, Europe's transition economices, and Latin America and the Caribbean) that not only fills that void for recent years but extends the estimates in a consistent and comparable way back in time and provides analytical narratives for scores of countries that shed light on the evolving nature and extent of policy interventions over the past half-century. 'Distortions to Agricultural Incentives in Asia' provides an overview of the evolution of distortions to agricultural incentives caused by price and trade policies in the 12 largest economies of East and South Asia. Together these countries constitute more than 95 percent of the region's population, agricultural output, and overall GDP. Sectoral, trade, and exchange rate policies in the region have changed greatly since the 1950s, and there have been substantial reforms since the 1980s, most notably in China and India. Nonetheless, numerous price distortions in this region remain and others have added in recent years. The new empirical indicators in these country studies provide a strong evidence-based foundation for assessing the successes and failures of the past and for evaluating policy options for the years ahead.

Distortions to World Trade

Distortions to World Trade PDF

Author: Kym Anderson

Publisher: World Bank Publications

Published: 2012

Total Pages: 40

ISBN-13:

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The authors provide estimates of the impact that removing all merchandise trade distortions (including agricultural subsidies) would have on food and agricultural production, trade, and incomes. Using the latest versions of the Global Trade Analysis Project (GTAP) database and the World Bank's LINKAGE model of the global economy (projected to 2015), their results suggest farm employment, the real value of agricultural output and exports, the real returns to farm land and unskilled labor, and real net farm incomes would all rise substantially in developing country regions with a move to free merchandise trade, thereby alleviating rural poverty-despite the decline in international terms of trade for developing countries that are net food importers or are enjoying preferential access to agricultural markets of high-income countries.

Measuring Distortions to Agricultural Incentives, Revisited

Measuring Distortions to Agricultural Incentives, Revisited PDF

Author: Kym Anderson

Publisher:

Published: 2012

Total Pages:

ISBN-13:

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Notwithstanding the tariffication component of the Uruguay Round Agreement on Agriculture, import tariffs on farm products continue to provide an incomplete indication of the extent to which agricultural producer and consumer incentives are distorted in national markets. Especially in developing countries, non-agricultural policies indirectly impact agricultural and food markets. Empirical analysis aimed at monitoring distortions to agricultural incentives thus need to examine both agricultural and non-agricultural policy measures including import or export taxes, subsidies and quantitative restrictions, plus domestic taxes or subsidies on farm outputs or inputs and consumer subsidies for food staples. This paper addresses the practical methodological issues that need to be faced when attempting to undertake such a measurement task in developing countries. The approach is illustrated in two ways: by presenting estimates of nominal and relative rates of assistance to farmers in China for the period 1981 to 2005; and by summarizing estimates from an economy-wide computable general equilibrium model of the effects on agricultural versus non-agricultural markets of the project's measured distortions globally as of 2004.

Measuring Distortions to Agricultural Incentives, Revisited

Measuring Distortions to Agricultural Incentives, Revisited PDF

Author: Kym Anderson

Publisher: World Bank Publications

Published: 2008

Total Pages: 45

ISBN-13:

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Abstract: Notwithstanding the tariffication component of the Uruguay Round Agreement on Agriculture, import tariffs on farm products continue to provide an incomplete indication of the extent to which agricultural producer and consumer incentives are distorted in national markets. Especially in developing countries, non-agricultural policies indirectly impact agricultural and food markets. Empirical analysis aimed at monitoring distortions to agricultural incentives thus need to examine both agricultural and non-agricultural policy measures including import or export taxes, subsidies and quantitative restrictions, plus domestic taxes or subsidies on farm outputs or inputs and consumer subsidies for food staples. This paper addresses the practical methodological issues that need to be faced when attempting to undertake such a measurement task in developing countries. The approach is illustrated in two ways: by presenting estimates of nominal and relative rates of assistance to farmers in China for the period 1981 to 2005; and by summarizing estimates from an economy-wide computable general equilibrium model of the effects on agricultural versus non-agricultural markets of the project's measured distortions globally as of 2004.