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Estimating Trade Liberalization Effects for U.S. Grains and Cotton
Author(s) -
Haley Stephen L.,
Herlihy Michael T.,
Johnston Brian
Publication year - 1991
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 - 10.2307/1349555
Subject(s) - economics , international economics , free trade , liberalization , international trade , agricultural economics , market economy
The Uruguay Round of multilateral trade negotiations is viewed by many as an historic opportunity to reform agricultural policies and liberalize agricultural trade. This paper analyzes the implications of assumptions about the effectiveness of acreage reduction programs, fixity of farm assets, and decoupling on trade liberalization results for U.S. grains and cotton. The range of outcomes for various slippage specifications is not very wide. More significant changes come from varying model supply elasticities that reflect the degree to which agricultural resources are not transferable to other sectors of the economy. Also, the degree to which deficiency payments are decoupled from production implies trade liberalization outcomes more favorable for the United States.