Tariff line analysis of U.S. and international dairy protection

Jason Grant (), Thomas Hertel and Thomas Rutherford ()

Agricultural Economics, 2007, vol. 37, issue s1, 271-280

Abstract: General equilibrium (GE) models have been criticized because of policy aggregation issues. Partial equilibrium (PE) models can be more disaggregated but do not account for the economy‐wide effects from trade reform. In this article, we illustrate a methodology that combines a fully disaggregated, subsector (PE) model with a standard GE framework permitting us to extend GE analysis to the tariff line. We offer some insight into the aggregation errors implicit in standard GE analyses by comparing our PE/GE approach to that of GE only under a global dairy liberalization experiment. Our PE/GE approach allows for a comprehensive treatment of tariff rate quotas at the sub‐sector level across narrowly defined product lines.

Date: 2007
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