The Local Impacts of Agricultural Subsidies: Evidence from the Canadian Prairies

Ray Bollman and Shon Ferguson
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Ray Bollman: Rural Development Institute, Postal: Brandon University, and University of Saskatchewan, Canada

No 1129, Working Paper Series from Research Institute of Industrial Economics

Abstract: We estimate the impact of the removal of a railway transportation subsidy on the local economies of Alberta, Saskatchewan and Manitoba, exploiting the large regional variation in these one-time freight rate increases. We find that higher freight rates – and hence lower farm gate prices – resulted in significantly lower farm revenues, farm asset values and farm numbers. Local employment in non-agricultural sectors systematically declined in areas that were hardest hit by the subsidy removal. The results suggest that the subsidy removal had detrimental spillover effects on local non-agricultural economy that are much larger than standard input-output models would predict.

Keywords: Agricultural Trade Liberalization; Export Subsidy; Market Access; Spillovers (search for similar items in EconPapers)
JEL-codes: F14 O13 Q16 Q17 Q18 (search for similar items in EconPapers)
Pages: 45 pages
Date: 2016-06-30
New Economics Papers: this item is included in nep-agr
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https://www.ifn.se/wfiles/wp/wp1129.pdf (application/pdf)

Related works:
Journal Article: The Local Impacts of Agricultural Subsidies: Evidence from the Canadian Prairies (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:hhs:iuiwop:1129

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