The Trans-Pacific Partnership and Japan’s Agricultural Trade

Schmitz Andrew (), Zhu Manhong () and David Zilberman
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Schmitz Andrew: Department of Food and Resource Economics, University of Florida, Gainesville, FL 32611-0240, USA
Zhu Manhong: Department of Food and Resource Economics, University of Florida, Gainesville, FL 32611-0240, USA

Journal of Agricultural & Food Industrial Organization, 2017, vol. 15, issue 1, 18

Abstract: The Trans-Pacific Partnership Agreement (TPPA) was concluded on October 5, 2015, by twelve countries that include the United States, Japan, Australia, Brunei, Canada, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam. Under the TPPA, Japan will partially liberalize its five politically sensitive agricultural subsectors: (1) rice, (2) beef and pork, (3) wheat and barley, (4) sugar, and (5) dairy, none of which contain any genetically modified (GM) content. Under full liberalization, Japanese producers in these subsectors will lose (e. g., rice producers will lose over $6 billion and beef producers will lose over $2 billion). Excluding butter, the trade impact of the TPPA on the Japanese government will be negative because of tariff and resale-revenue losses. Our empirical results provide the full effects of complete trade liberalization. However, because the TPPA negotiations of 2015 resulted in only partial trade liberalization, our results can be easily modified to deal with the degree to which trade distortions are removed for each of the above agricultural subsectors. In terms of producers who lose from trade liberalization, the Japanese government will provide compensation.

Keywords: Trans-Pacific Partnership; GMOs; Japan; agricultural trade; trade liberalization; welfare impact; cost of protection (search for similar items in EconPapers)
JEL-codes: F13 F14 Q17 Q18 (search for similar items in EconPapers)
Date: 2017
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DOI: 10.1515/jafio-2017-0001

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