The Uruguay Round and Welfare in Some Distorted Agricultural Economies

29 Pages Posted: 11 Jun 2000 Last revised: 10 Mar 2022

See all articles by James E. Anderson

James E. Anderson

Boston College - Department of Economics; National Bureau of Economic Research (NBER)

Multiple version iconThere are 2 versions of this paper

Date Written: February 1997

Abstract

There is widespread concern that the Uruguay Round may reduce the welfare of developing countries through its effect on world agricultural prices. Reduced agricultural price distortions among major supplying nations are predicted to increase basic food prices and decrease some important export prices such as those for coffee and cotton. It appears that raising food prices paid by food importers must be bad for them, while reducing world coffee and cotton prices appears bad for exporters of those products. Appearances may be deceiving, however, since theory shows that a distortion effect operates alongside the standard terms of trade effect. I report here distortion effects which are many times larger" than terms of trade effects in an analysis of the Uruguay Round's impact on 9 agricultural economies. I deploy a simple Computable General Equilibrium model. The 9 developing economies are distorted by domestic agricultural distortions in 15 markets, along with hundreds of 4 digit nonagricultural tariffs and quotas. In 3 of 9 countries, the distortion effect reverses the impact of the terms of trade effect. In 2 other countries the distortion effect raises a trivial terms of trade effect up to around 1% of national income.

Suggested Citation

Anderson, James E., The Uruguay Round and Welfare in Some Distorted Agricultural Economies (February 1997). NBER Working Paper No. w5923, Available at SSRN: https://ssrn.com/abstract=225704

James E. Anderson (Contact Author)

Boston College - Department of Economics ( email )

140 Commonwealth Avenue
Chestnut Hill, MA 02467
United States
617-552-3691 (Phone)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Do you have negative results from your research you’d like to share?

Paper statistics

Downloads
39
Abstract Views
1,098
PlumX Metrics