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The Absence of Dynamic Gains from Free Trade in Agriculture: Implications for the Governance of Agricultural Trade and Development

W. Moon and Gabriel Pino Saldías

No 275869, 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia from International Association of Agricultural Economists

Abstract: This study draws upon research in economics and agricultural economics to demonstrate that free trade in agriculture is not poised to bring about dynamic/productivity gains. That is in contrast to the mounting evidence of dynamic/productivity gains (in addition to the static gains) from free trade in manufacturing industries/firms. We show that the lack of the dynamic gains from agricultural trade is due to the passivity of farm producers in determining their productivity and international competitiveness. It is highlighted that it is neither free trade nor greater competitive pressure on farm producers but public investments for R&D/infrastructure/extension that would bring about improvements in productivity over time. Implications of the lack of the dynamic gains are discussed for governing agricultural trade and designing development strategies in food-importing low income countries.

Keywords: Agricultural and Food Policy; International Relations/Trade (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-agr, nep-cse, nep-eff and nep-int
Date: 2018-07
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