Implications of Domestic Support Disciplines for Further Agricultural Trade Liberalization

Keith Walsh (), Martina Brockmeier and Alan Matthews

The Institute for International Integration Studies Discussion Paper Series from IIIS

Abstract: This paper employs the GTAP computable general equilibrium model and dataset to analyse the implications of domestic support reductions in the context of agricultural trade liberalisation. Three specific issues are addressed: overhang in domestic support, the accurate distinction of the boxes in the GTAP dataset and the treatment of market price support in the amber box. An extensive domestic support database is used to calculate the change in applied domestic support rates from a specified cut in bound rates, and to identify the impact on the different domestic support boxes and the required reductions in each support category. The GTAP model is extended to incorporate an explicit representation of the market price support element of the AMS. The results from these extensions of the standard database and model support the view that the impact of an agreement to reduce domestic support will be limited and lower than conventionally estimated. Results of simulations combining domestic support cuts with market access and export competition disciplines show that the effect of import tariff reductions dominate the gains from domestic support cuts once full account is taken of the issues addressed in this paper.

Keywords: WTO agricultural negotiations; domestic support; agricultural protection; Aggregate Measure of Support (search for similar items in EconPapers)
JEL-codes: C68 F13 Q17 Q18 (search for similar items in EconPapers)
Date: 2005-12-15
New Economics Papers: this item is included in nep-agr, nep-cmp and nep-int
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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