Replaced with revised version of paper 12/06/06.

With the rising global interest in energy security and climate change mitigation, biofuelshave gained the prominent attention of researchers and policy makers. The U.S. has emerged asthe leading producer of biofuels and is aiming for achieving a target of 36 billion gallons ofrenewable fuels by...

We analyze the impact of trade liberalization and removal of the federal tax credit in the United States on U.S. and Brazilian ethanol markets using a multi-market international ethanol model calibrated on 2005 market data and policies. The removal of trade distortions induces a 23.9 percent...