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Changing the U.S. Sugar Program into a Standard Crop Program: Consequences under the North American Free Trade Agreement and Doha
Author(s) -
Abler David,
Beghin John C.,
Blandford David,
Elobeid Amani
Publication year - 2008
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.1467-9353.2007.00393.x
Subject(s) - free trade agreement , crop , sugar , economics , free trade , agricultural economics , international trade , business , international economics , geography , forestry , chemistry , food science
We analyze the impact of continuing the existing U.S. sugar program, replacing it with a standard program, and implementing the standard program with multilateral trade liberalization. Under the North American Free Trade Agreement (NAFTA), duty‐free sugar imports from Mexico could undermine the program's ability to operate on a “no‐cost” basis to taxpayers as large public stocks of sugar could accumulate. The replacement of the current sugar program by one similar to other major U.S. crop programs would solve the problem of potential stock accumulation, accommodate further trade liberalization under a new WTO and future bilateral trade agreements, but would induce significant fiscal outlays through direct payments.