Regulatory Barriers in an Integrating World Food Market

In the article by Dawn D. Thilmany and Christopher B. Barrett, the square characters should not have appeared in lines 10 and 23 of page 96, and in lines 1 and 2 of page 97. The second full paragraph of page 96 should read as follows: Under free trade, and assuming no transfer costs, the equilibrium price in both nations is P A , with consumption (production) at point B(A) in country 1 and at point L(K) in country 2, implying a trade volume equal to B − A = K − L =b . The fourth full paragraph, beginning on page 96 and continuing on page 97, should read as follows: But what if the regulatory control of imports in country 1 resolves consumer concerns about product quality and safety, thereby stimulating demand (from D 1 to D′ 1 in the left panel, and from ED 1 to ED ′ 1 in the right panel)? Then there will again be higher prices than under free trade ( P 1 c instead of P 1 A ), but trade volumes and aggregate welfare could be greater (if and only if c > b and EFGH > ABE , respectively) than under unregulated trade. Moreover, if and only if the demand‐side effects of the regulatory barriers sufficiently stimulate demand such that trade volume is greater (less) than the free‐trade equilibrium, for example, if c > b ( b>c ), then prices and aggregate welfare rise (fall) in country 2, for example, from P 2 A to P 2 c and by KLMN , respectively, in figure 4. This implies that exporting firms in country 2 can be better off by demand stimulating regulatory barriers imposed by the government in country 1.