Premium
Evaluating the Market and Welfare Impacts of Agricultural Policies in Developed Countries: Comparison of Partial and General Equilibrium Measures
Author(s) -
Gohin Alexandre,
Moschini GianCarlo
Publication year - 2006
Publication title -
applied economic perspectives and policy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.4
H-Index - 49
eISSN - 2040-5804
pISSN - 2040-5790
DOI - 10.1111/j.1467-9353.2006.00281.x
Subject(s) - partial equilibrium , economics , welfare , general equilibrium theory , agriculture , economic welfare , applied general equilibrium , natural resource economics , public economics , international economics , macroeconomics , agricultural economics , market economy , ecology , biology
We revisit the question of choosing partial equilibrium or general equilibrium modeling in applied policy analysis in the context of evaluating the effects of a complete phase‐out of the Common Agricultural Policy (CAP) of the European Union. We compare the results of three models—two three‐sector general equilibrium models (one with an additional major distortion in the nonagricultural sector) and a two‐sector partial equilibrium model. We find that the market effects of a complete phase‐out of the CAP are quite comparable across these models. On the other hand, the measured welfare impacts may depend on the modeling choice.