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The Missing Food Problem: Trade, Agriculture, and International Productivity Differences

Trevor Tombe ()

American Economic Journal: Macroeconomics, 2015, vol. 7, issue 3, 226-58

Abstract: Agriculture in poor countries has low productivity, high employment, and negligible trade flows relative to other sectors. These facts motivate a multisector, open-economy view of international productivity differences. With a quantitative multicountry model featuring nonhomothetic preferences, multiple interrelated sectors, distorted labor markets, and costly trade, I find: trade amplifies the negative effect of labor market distortions; trade costs—large for poor countries, especially in agriculture—significantly contribute to international productivity differences; and explicitly modeling agriculture reveals additional channels through which poor countries may gain from trade. (JEL F41, J24, J43, O13, O19, Q11, Q17)

JEL-codes: F41 J24 J43 O13 O19 Q11 Q17 (search for similar items in EconPapers)
Date: 2015
Note: DOI: 10.1257/mac.20130108
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