Welfare- and Trade-Based Indicators of National Distortions to Agricultural Incentives

Despite reforms over the past quarter-century, world agricultural markets remain highly distorted by government policies. Traditional indicators of those price distortions such as the nominal rate of assistance and consumer tax equivalent provide measures of the degree of intervention, but they can be misleading as indicators of the true effects of those policies. By drawing on recent theoretical literature that provides indicators of the trade- and welfare-reducing effects of price and trade policies, this paper develops more-satisfactory indexes for capturing distortions to agricultural incentives. It then exploits the agricultural distortion database recently compiled by the World Bank to generate estimates of them for both developing and high-income countries over the past half century, based on a sample of 75 countries that together account for all but one-tenth of the world's population, gross domestic product (GDP) and agricultural production. While they are still only partial equilibrium measures, they provide a much better approximation of the true trade and welfare effects of sectoral policies without needing a formal model of global markets or even price elasticity estimates.

Bibliographic Details

Main Authors:	Lloyd, Peter J., Croser, Johanna L., Anderson, Kym
Format:	Working Paper biblioteca
Language:	English en_US
Published:	World Bank, Washington, DC 2009-03
Subjects:	ADVANCED ECONOMIES, AGGREGATE DEMAND, AGRICULTURAL COMMODITIES, AGRICULTURAL COMMODITY, AGRICULTURAL COMMODITY MARKETS, AGRICULTURAL INCENTIVES, AGRICULTURAL INDUSTRIES, AGRICULTURAL INDUSTRY, AGRICULTURAL MARKETS, AGRICULTURAL POLICIES, AGRICULTURAL POLICY, AGRICULTURAL PRICE, AGRICULTURAL PRODUCTION, AGRICULTURAL PRODUCTS, AGRICULTURAL PROGRAMS, AGRICULTURAL PROTECTION, AGRICULTURAL SECTOR, AGRICULTURAL SECTORS, AGRICULTURAL TRADE, AGRICULTURAL VALUE, AGRICULTURE, BORDER MEASURES, BORDER PRICE, BORDER PRICES, CONSUMER PRICE, CONSUMER PRICES, CONSUMER SURPLUS, CONSUMERS, DEMAND FUNCTION, DEVELOPING COUNTRIES, DEVELOPING COUNTRY, DOLLAR VALUES, DOMESTIC PRICE, DOMESTIC PRICES, DOMESTIC PRODUCER, DOMESTIC PRODUCTION, ECONOMIC EFFECTS, EQUILIBRIUM, EXCHANGE RATE, EXCHANGE RATES, EXPORT, EXPORT PRICE, EXPORT SECTOR, EXPORT SUBSIDY, EXPORT TAX, EXPORTABLE GOODS, EXTERNALITIES, FARM, FARM INCOMES, FARM INPUTS, FARM PRODUCTS, FARM SECTOR, FARMERS, FEDERAL RESERVE, FEDERAL RESERVE BANK, FREE TRADE, FREE TRADE AREA, GDP, GDP PER CAPITA, GENERAL EQUILIBRIUM, GENERAL EQUILIBRIUM MODEL, GLOBAL MARKETS, GLOBAL TRADE, GOVERNMENT INTERVENTIONS, GROSS VALUE, IMPORT MEASURES, IMPORT TARIFF, IMPORT TAX, IMPORT VOLUME, IMPORTS, INCOME, INDEX NUMBERS, INTERNATIONAL ECONOMICS, INTERNATIONAL TRADE, INTERVENTION MEASURES, MARGINAL COSTS, MARKET FAILURES, MARKETING, NET EXPORTS, OPEN ECONOMY, OUTPUT, PARTICULAR COUNTRY, PRICE ADJUSTMENT, PRICE CHANGE, PRICE CONTROLS, PRICE DISTORTION, PRICE DISTORTIONS, PRICE ELASTICITY, PRICE INCREASES, PRICE SUPPORT, PRODUCER PRICE, PRODUCER PRICES, QUOTA RENTS, REAL GDP, SOCIAL WELFARE, SUBSTITUTION, SUPPLY CURVES, SUPPLY FUNCTIONS, TARIFF BORDER, TARIFF RATE, TARIFF RATES, TARIFF REVENUE, TAX, TAX RATE, TAXATION, TOTAL AGRICULTURAL PRODUCTION, TRADE DISTORTIONS, TRADE POLICIES, TRADE POLICY, TRADE REDUCTION, TRADE RESTRICTION, TRADE RESTRICTIONS, TRADE TAX, TRADE VOLUME, TRANSITION ECONOMIES, UNEMPLOYMENT, VALUE ADDED, VOLUME, WORLD PRICE, WORLD TRADE,
Online Access:	http://documents.worldbank.org/curated/en/834231468331880018/Welfare-and-trade-based-indicators-of-national-distortions-to-agricultural-incentives https://hdl.handle.net/10986/28180
Tags:	Add Tag No Tags, Be the first to tag this record!