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Gains and Losses of Sugar Program Policy Options
Author(s) -
Leu GwoJiun M.,
Schmitz Andrew,
Knutson Ronald D.
Publication year - 1987
Publication title -
american journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.949
H-Index - 111
eISSN - 1467-8276
pISSN - 0002-9092
DOI - 10.2307/1241694
Subject(s) - sugar , harm , tariff , sugar production , economics , international economics , business , public economics , food science , chemistry , political science , law
High domestic sugar prices supported by U.S. sugar policy have induced a significant substitution of corn sweeteners for sugar. Recognizing the close relationship between sugar and corn sweeteners, this study applies a general equilibrium approach to evaluate the distributional effects of three different policy options (i.e., quota, tariff, and deficiency payment) on sugar related interest groups. The results show that the current quota policy, intended ostensibly to protect domestic sugar producers, have hurt foreign exporters. It will harm domestic sugar producers if the trend continues. Additionally, the quota program is the most expensive of the options considered.