Agricultural Trade Preferences and the Developing Countries

John Wainio (), Shahla Shapouri, Michael A. Trueblood and Paul R. Gibson

No 7258, Economic Research Report from United States Department of Agriculture, Economic Research Service

Abstract: Nonreciprocal trade preference programs originated in the 1970s under the Generalized System of Preferences (GSP) as an effort by high-income developed countries to provide tariff concessions for low-income countries. The goal of the programs was to increase export earnings, promote industrialization, and stimulate economic growth in the lower income countries. This study analyzes detailed trade and tariff data for the United States and the European Union (the two largest nonreciprocal preference donors) to determine the extent to which the programs have increased exports from beneficiary countries. For those products where the margins of preference are large and where beneficiaries have a comparative advantage and the capacity to expand production, these programs can create adequate incentives leading to a growing export market. The analysis finds that the programs offer significant benefits for some countries, mostly the higher income developing countries. Economic benefits in the least developed countries have been modest. An unanswered question is whether these gains will continue after the incentives are reduced.

Keywords: International; Relations/Trade (search for similar items in EconPapers)
Pages: 50
Date: 2005
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Citations: View citations in EconPapers (7)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:uersrr:7258

DOI: 10.22004/ag.econ.7258

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