Why Governments Tax or Subsidize Trade: Evidence from Agriculture

Kishore Gawande and Bernard Hoekman

No 50300, Agricultural Distortions Working Paper Series from World Bank

Abstract: This paper empirically explores the political-economic determinants of why governments choose to tax or subsidize trade in agriculture. We use a new data set on nominal rates of assistance (NRA) across a number of commodities spanning the last five decades for 64 countries. NRAs measure the effect on domestic (relative to world) price of the quantitative and price-based instruments used to regulate agricultural markets. The data set admits consideration of both taxes and subsidies on exports and imports. We find that both economic and political variables play important roles in determining the within-variation in the NRA data. Based on our results we offer a number of data-driven exploratory hypotheses that can inform future theoretical and empirical research on why governments choose to tax or subsidize agricultural products – an important policy question that is also one of the least understood by scholars.

Keywords: Agricultural and Food Policy; International Relations/Trade (search for similar items in EconPapers)
Pages: 66
Date: 2009-05
New Economics Papers: this item is included in nep-agr
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://ageconsearch.umn.edu/record/50300/files/Wh ... 85_%20May%202009.pdf (application/pdf)

Related works:
Working Paper: Why Governments Tax or Subsidize Trade: Evidence From Agriculture (2010)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ags:wbadwp:50300

DOI: 10.22004/ag.econ.50300

Access Statistics for this paper

More papers in Agricultural Distortions Working Paper Series from World Bank
Bibliographic data for series maintained by AgEcon Search ().