Analyzing the Impacts of the Proposed North American Free Trade Agreement on European-North American Dairy Trade Using a Joint-Input, Multi-Product Approach

Phillip M. Bishop, James E. Pratt and Andrew M. Novakovic

No 121341, Staff Papers from Cornell University, Department of Applied Economics and Management

Abstract: Mathematical programming models, as typically formulated for international trade applications, may contain certain implied restrictions limiting price responsiveness, intermediate product flows, and arbitrage possibilities. These restrictions are especially important in the case of dairy, and may lead to results which are technically infeasible, or if feasible, not consistent with market equilibrating behavior. The difficulties encountered when modeling dairy trade are described, and an alternative formulation of a spatial model is presented. This formulation allows joint-inputs, multi-products, intermediate markets, and pure transshipment and product substitution forms of arbitrage.

Keywords: International Relations/Trade; Livestock Production/Industries (search for similar items in EconPapers)
Pages: 20
Date: 1993-09
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Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:cudasp:121341

DOI: 10.22004/ag.econ.121341

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