Agricultural Market Liberalization and Instability of Domestic Agricultural Markets: The Case of the CAP

Thompson, Stanley R.; Herrmann, Roland; Gohout, Wolfgang

doi:10.1111/0002-9092.00068

Cited by 18 publications

(11 citation statements)

References 5 publications

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“…On the other hand, the model does not account for the possibility of a significant policy-induced change in price transmission. Thompson, Herrmann and Gohout (2000) show that the recent policy reforms did not change the pattern of price transmission between world and domestic prices.…”

Section: Wheat Market Modelmentioning

confidence: 89%

“…Export subsidies are still variable and not fixed as specific or ad-valorem subsidies. Thus, the effects of the implemented rules of tariffication on instability are low (Thompson, Herrmann and Gohout, 2000) and the degree of price transmission between the world and domestic markets is still considerably less than 1.0. However, the URAA decisions on the reduction of bound tariffs should result in a broader range over which domestic prices will reflect world market conditions.…”

Section: Eu Policy Environmentmentioning

confidence: 99%

“…The model also allows for a non-zero linkage between world and domestic prices. A rationale could be budget pressure which might affect price decisions within the CAP, as indicated by earlier studies of the cereals market (Thompson, Herrmann and Gohout, 2000) or of the political economy of agricultural price decisions in the EU (Olper, 1998). On the other hand, the model does not account for the possibility of a significant policy-induced change in price transmission.…”

Section: Wheat Market Modelmentioning

confidence: 99%

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CAP Reforms in the 1990s and their Price and Welfare Implications: The Case of Wheat

Thompson

Gohout

Herrmann

2002

J Agricultural Economics

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We use a nonlinear commodity market model to assess, theoretically and empirically, the impacts of recent reforms of the CAP on prices and economic welfare in the EU. The empirical analysis is based on an aggregate structural econometric model of the EU wheat economy and its links to the rest of the world. Instability issues are also investigated. Impacts of CAP reforms on the variance of domestic and world prices are analysed and a Monte Carlo simulation is used to evaluate uncertainty in the model's welfare computations. Recent reforms led to a net welfare gain within the EU during the period 1993–2000. Additional budgetary costs are less than the welfare gains of consumers and producers. Producers gained as lower price support was overcompensated by additional direct payments.

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Section: Wheat Market Modelmentioning

confidence: 89%

Section: Eu Policy Environmentmentioning

confidence: 99%

Section: Wheat Market Modelmentioning

confidence: 99%

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CAP Reforms in the 1990s and their Price and Welfare Implications: The Case of Wheat

Thompson

Gohout

Herrmann

2002

J Agricultural Economics

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“…Indeed, a reduction in MPSs has continued following Agenda 2000 but area payments have increased. Important differences in the price and producer welfare effects of policy have been found between the pre-and post-MacSharry regimes (Thompson et al, 2000;Thompson et al, 2002a;Thompson et al, 2002b). The ex post analysis does not include the period of Agenda 2000.…”

Section: Policy Environmentmentioning

confidence: 99%

The real rate of protection: the income and insurance effects of agricultural policy

et al. 2004

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Agricultural price policies in developed countries aim at protecting farmers against both low and volatile world market prices. However, traditional indicators of protection only refer to the income (level) effect of policy. Following other research, it is argued that public policy can also yield an insurance (stabilizing) effect. In this paper a way to measure these dual effects is proposed. The method is illustrated with wheat market data for the USA and the European Union. Strong evidence is found that the insurance effect is an important component of protection, albeit a small one relative to the income effect. Policy support provided higher income and lower insurance effects in the EU than in the USA. For both markets, policy reforms in the 1990s led to significantly reduced income effects and smaller insurance effects. Without accounting for the influence of policy on income variability, traditional measures of protection will understate the real rate of protection.

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“…In some cases, no real tariffication occurred as in the case of the European Union (EU) grain policy [Thompson et al, 2000]. A first draft of this paper was presented at the International Atlantic Economic Conference, March 14-21,2000, Munich, Germany.…”

Section: Introductionmentioning

confidence: 99%

Tariff rate quotas and the economic impact of agricultural trade liberalization in the world trade organization

Herrmann

Kramb

Mönnich

2001

International Advances in Economic Research

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ROLAND HERRMANqN', MARC KRAMB, AND CHRISTINA M()NNICH*Since their implementation at the Uruguay Round, tariff rate quotas (TRQs) have become a widely used instrument of trade policy in agricultural trade. With almost 1,300 TRQs scheduled at the World Trade Organization, this paper will examine their economic effects more closely. First, the theoretical background of TRQs is examined. Then, a short overview of the Uruguay Round and their institutional background is given. We demonstrate that official statistics, which do not count TRQs as nontariff barriers, are at least highly misleading. Very often, their effects are the same as those of regular quotas, including redistributive effects. The prominent example of the European banana regime is used to illustrate all of these points. (JEL FIO)

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Agricultural Market Liberalization and Instability of Domestic Agricultural Markets: The Case of the CAP

Cited by 18 publications

References 5 publications

CAP Reforms in the 1990s and their Price and Welfare Implications: The Case of Wheat

CAP Reforms in the 1990s and their Price and Welfare Implications: The Case of Wheat

The real rate of protection: the income and insurance effects of agricultural policy

Tariff rate quotas and the economic impact of agricultural trade liberalization in the world trade organization

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