IMPORT SAFEGUARDS: PROTECTIONIST MEASURES OR A LIBERALIZATION STRATEGY?
The Doha Trade Round maintains that a considerable effort will be given to take into account better the particular needs of developing nations. Many low-income countries argue that the flexibility to invoke a special safeguard mechanism when faced with volatile commodity markets is a necessary condition for further market access reform. The implications of a safeguard for developing agriculture as a trade-off for lowering their tariff rates, is an important empirical question. Two stochastic simulation experiments are developed using wheat as a case study to estimate the marginal effects of a safeguard in terms of domestic market stability and on developed exporting nations. The results reveal that a safeguard for developing agriculture is minimally trade distorting and in general, costs less than one percent of total world welfare that would be realized if low-income countries were not granted a safeguard. Furthermore, safeguards are an attractive policy tool because they are transparent, easy to use and are an automatic mechanism.
Year of publication: |
2004
|
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Authors: | Grant, Jason H. ; Meilke, Karl D. |
Institutions: | Agricultural and Applied Economics Association - AAEA |
Keywords: | International Relations/Trade |
Saved in:
freely available
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