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CARD Working Papers

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Full-Text Articles in International Economics

Long-Run Impacts Of Trade Shocks And Export Competitiveness: Evidence From The U.S. Bse Event, Chen-Ti Chen, John M. Crespi, William Hahn, Lee L. Schulz, Fawzi Taha Sep 2019

Long-Run Impacts Of Trade Shocks And Export Competitiveness: Evidence From The U.S. Bse Event, Chen-Ti Chen, John M. Crespi, William Hahn, Lee L. Schulz, Fawzi Taha

CARD Working Papers

This paper examines how comparative advantages of major beef exporters changed following the 2003 bovine spongiform encephalopathy outbreak (BSE), which significantly disrupted the U.S. beef trade until approximately April 2007. Using longitudinal data on beef export values and constructed revealed comparative advantage measures, we show that while some measure of the long-run impacts of BSE on U.S. beef export competitiveness have returned to pre-2003 levels, the U.S.’s comparative advantage has not. We also examine a hypothetical scenario of no BSE event in 2003 and predict what exporters’ competitiveness would have looked like. The authors discuss the ...


Economic Effects Of Standard-Like Nontariff Measures: Analytical And Methodological Dimensions, John Beghin, Bo Xiong Oct 2016

Economic Effects Of Standard-Like Nontariff Measures: Analytical And Methodological Dimensions, John Beghin, Bo Xiong

CARD Working Papers

We provide a selective review of the empirical international trade literature on nontariff measures (NTMs) acting like standards–the so-called technical measures under the MAST classification. This review focuses on analytical and methodological dimensions involved in evaluating these NTMs and their economic effects, and draws from established approaches to measure standard-like NTMs and rigorous models used to quantify their effects on trade and welfare. The quantification of technical measures and the assessment of their effects are often entangled. We present each of these major approaches and methodologies with some formalism and details to help guide future investigations of technical measures ...


Ttip And Agricultural Trade: The Case Of Tariff Elimination And Pesticide Policy Cooperation, Bo Xiong, John C. Beghin Jun 2016

Ttip And Agricultural Trade: The Case Of Tariff Elimination And Pesticide Policy Cooperation, Bo Xiong, John C. Beghin

CARD Working Papers

A possible Trans-Atlantic Trade and Investment Partnership (TTIP) agreement will further integrate agricultural markets between the United States and the European Union. The elimination of tariffs and cooperation on sanitary and phytosanitary measures will promote cross-Atlantic trade. We empirically estimate the impacts of tariffs and Maximum Residue Limits (MRLs) on trade in plant products between the two partners. Furthermore, we simulate trade expansions under plausible negotiation outcomes. We find that a TTIP agreement promotes cross-Atlantic trade in plant products, in both directions, by over 60% if tariffs are removed and MRLs are mutually recognized or harmonized to Codex levels.


Trans-Pacific Partnership And Foreign Ag Subsidies, Dermot J. Hayes Nov 2015

Trans-Pacific Partnership And Foreign Ag Subsidies, Dermot J. Hayes

CARD Working Papers

Testimony before the House Committee on Agriculture


Non-Tariff Measures And Standards In Trade And Global Value Chains, John C. Beghin, Miet Maertens, Johan Swinnen Feb 2015

Non-Tariff Measures And Standards In Trade And Global Value Chains, John C. Beghin, Miet Maertens, Johan Swinnen

CARD Working Papers

Abstract: We assess the literature on public and private quality standards and their impact in food markets, international trade, and global supply chains. We focus on their effects on welfare, trade, industrial organization, and labor markets and with special attention to the North-South context. We also attempt to better characterize when these measures constitute protectionism, a complicate task. We look at studies investigating public and private standards and across various quantitative approaches and countries. These standards have complex effects. The evidence is mixed regarding standards as catalyst for or impediment against trade and development, reflecting the complexity of these effects ...


A Consistent Food Demand Framework For International Food Security Assessment, John C. Beghin, Birgit Meade, Stacey Rosen Feb 2015

A Consistent Food Demand Framework For International Food Security Assessment, John C. Beghin, Birgit Meade, Stacey Rosen

CARD Working Papers

We present a parsimonious demand modeling approach developed for the annual USDA-ERS International Food Security Assessment. The assessment focuses on chronic food insecurity. The approach incorporates price effects, food quality variation across income deciles, and consistent aggregation over income deciles and food qualities. The approach is based on a simple demand approach for four food categories. It relies on the existing sparse data available for the Assessment, complemented by own-price and income elasticities and available price data. Beyond consistent aggregation, the framework exhibits desirable characteristics: food quality is increasing with income; price and income responses become less sensitive with increasing ...


The Impact Of An Eu-Us Transatlantic Trade And Investment Partnership Agreement On Biofuel And Feedstock Markets, John C. Beghin, Jean-Christophe Bureau, Alexandre Gohin Nov 2014

The Impact Of An Eu-Us Transatlantic Trade And Investment Partnership Agreement On Biofuel And Feedstock Markets, John C. Beghin, Jean-Christophe Bureau, Alexandre Gohin

CARD Working Papers

We assess the impact of a potential TTIP bilateral free trade agreement on the EU and US bio-economies (feedstock, biofuels, by-products, and related competing crops) and major trade partners in these markets. The analysis develops a multi-market model that incorporates bilateral trade flows (US to EU, EU to US, and similarly with third countries) and is calibrated to OECD-FAO baseline for 2013–2022 to account for recent policy decisions. The major policy reforms from a TTIP involve tariff and TRQ liberalization and their direct contractionary impact on US sugar supply, EU biofuel production, and indirect negative effect on US HFCS ...


Disentangling Demand-Enhancing And Trade-Cost Effects Of Maximum Residue Regulations, Bo Xiong, John C. Beghin Nov 2013

Disentangling Demand-Enhancing And Trade-Cost Effects Of Maximum Residue Regulations, Bo Xiong, John C. Beghin

CARD Working Papers

Maximum residue levels (MRLs) regulations in plant products can create unnecessary trade barriers on one hand and enhance demand via risk mitigation or quality assurance on the other. We stipulate a generalized gravity equation model to disentangle the effects of MRLs on the import demand and foreign exporters’ supply. Applying the framework to the MRLs on pesticides imposed by high-income OECD countries, we find that the MRLs jointly enhance the import demand and hinder foreign exporters’ supply. In addition, exporters from the less and least developed countries are more constrained by the MRLs than their competitors from the developed world.


Testimony Before The Us-China Economic Security Review Commission: China's Agriculture Policy And Us Access To China's Market, Dermot J. Hayes May 2013

Testimony Before The Us-China Economic Security Review Commission: China's Agriculture Policy And Us Access To China's Market, Dermot J. Hayes

CARD Working Papers

Testimony before the US-China Economic and Security Review Commission on April 25, 2013, by Dermot Hayes, professor of Economics and Finance, Iowa State University. Testimony covers impacts on food demand from China's rising incomes and urbanization; the viability of China's attempt to remain self-sufficient in meat and key staple crop production under inherent supply constraints, and the possible technological- and policy-based measures they may pursue in regard of such constraints; and, the main challenges to US-China agricultural trade in the short, medium, and long term.


The Impact Of The U.S. Sugar Program Redux, John C. Beghin, Amani E. Elobeid May 2013

The Impact Of The U.S. Sugar Program Redux, John C. Beghin, Amani E. Elobeid

CARD Working Papers

We analyze the various welfare costs, transfers, trade, and employment consequences of the current U.S. sugar program for U.S. consumers, other sugar users, sugar refiners, cane and beet growing and processing industries, other associated agricultural sectors, and world markets. The removal of the sugar program would increase U.S. consumers’ welfare by $2.9 to $3.5 billion each year and generate a modest job creation of 17,000 to 20,000 new jobs in food manufacturing and related industries. Imports of sugar containing products would fall dramatically, especially confectioneries substituting for domestic inputs under the sugar program ...


World Market Impacts Of High Biofuel Use In The European Union, Miguel Carriquiry, Fengxia Dong, Xiaodong Du, Amani E. Elobeid, Jacinto F. Fabiosa, Eddie Chavez, Suwen Pan Jul 2010

World Market Impacts Of High Biofuel Use In The European Union, Miguel Carriquiry, Fengxia Dong, Xiaodong Du, Amani E. Elobeid, Jacinto F. Fabiosa, Eddie Chavez, Suwen Pan

CARD Working Papers

This study examines the world market impact of an expansion in the biofuel sector in the European Union with particular focus on indirect land-use impacts. In the first scenario, an increase of 1 million tonnes oil equivalent (Mtoe) of wheat ethanol use in the European Union expands world land area used in agricultural commodity production by 366,000 hectares, representing an increase of 0.039% in total area. In the second scenario, an increase of 1 Mtoe of rapeseed oil biodiesel use in the European Union expands world land area by 352,000 hectares, representing an increase of 0.038 ...


Agricultural Land Elasticities In The United States And Brazil, Kanlaya J. Barr, Bruce A. Babcock, Miguel Carriquiry, Andre Nasser, Leila Harfuch Feb 2010

Agricultural Land Elasticities In The United States And Brazil, Kanlaya J. Barr, Bruce A. Babcock, Miguel Carriquiry, Andre Nasser, Leila Harfuch

CARD Working Papers

The elasticity of aggregate supply is one key to understanding the degree to which policyinduced increases in demand for biofuel feedstocks or agricultural CO2 offsets will result in higher prices or expanded supply. In this paper we report land supply elasticities for the United States and Brazil estimated directly from the observed changes in cropland and estimated changes in expected returns. The resulting aggregate implied land-use elasticities with respect to price are quite inelastic in the United States and more elastic in Brazil (0.007-0.029 and 0.382- 0.895, respectively). However, with pasture land included in Brazil, implied ...


Biofuels: Potential Production Capacity, Effects On Grain And Livestock Sectors, And Implications For Food Prices And Consumers, Dermot J. Hayes, Bruce A. Babcock, Jacinto F. Fabiosa, Simla Tokgoz, Amani E. Elobeid, Tun-Hsiang (Edward) Yu, Fengxia Dong, Chad E. Hart, Eddie Chavez, Suwen Pan, Miguel Carriquiry, Jerome R. F. Dumortier Mar 2009

Biofuels: Potential Production Capacity, Effects On Grain And Livestock Sectors, And Implications For Food Prices And Consumers, Dermot J. Hayes, Bruce A. Babcock, Jacinto F. Fabiosa, Simla Tokgoz, Amani E. Elobeid, Tun-Hsiang (Edward) Yu, Fengxia Dong, Chad E. Hart, Eddie Chavez, Suwen Pan, Miguel Carriquiry, Jerome R. F. Dumortier

CARD Working Papers

We examine four scenarios for the evolution of the biofuel sector using a partial equilibrium model of the world agricultural sector. The model includes the new Renewable Fuels Standard in the 2007 energy act, the two-way relationship between fossil energy and biofuel markets, and a new trend toward corn oil extraction in ethanol plants. At one extreme, one scenario eliminates all support to the biofuel sector when the energy price is low, while the other extreme assumes no distribution bottleneck in ethanol demand growth when the energy price is high. Of the remaining two scenarios, one considers a pure market ...


The Impact Of Energy Markets On The Eu Agricultural Sector, Simla Tokgoz Jan 2009

The Impact Of Energy Markets On The Eu Agricultural Sector, Simla Tokgoz

CARD Working Papers

The objective of this study is to analyze the impact of crude oil prices on the EU agricultural sector in an era when the biofuels sector is expanding because of policy initiatives and the desire to find alternative fuel sources. To this end, first a baseline is set up for the EU ethanol, grain, and dried distillers grains markets. In the next step, two different scenarios are run. The first scenario incorporates a 10-Euros-per-barrel increase in the EU crude oil price with the ethanol import tariffs in place. The second scenario incorporates the same shock with the ethanol import tariffs ...


Determinants Of World Demand For U.S. Corn Seeds: The Role Of Trade Costs, Sampath Jayasinghe, John C. Beghin, Giancarlo Moschini Jan 2009

Determinants Of World Demand For U.S. Corn Seeds: The Role Of Trade Costs, Sampath Jayasinghe, John C. Beghin, Giancarlo Moschini

CARD Working Papers

The United States is a large net exporter of corn seeds. Seed trade, including that of corn, has been expanding, but its determinants are not well understood. This paper econometrically investigates the determinants of world demand for U.S. corn seeds with a detailed analysis of trade costs impeding export flows to various markets, including costs associated with distance, tariffs, and sanitary and phytosanitary (SPS) regulations. The analysis relies on a gravity-like model based on an explicit specification of derived demand for seed by foreign corn producers, estimated based on data from 48 countries and for the years 1989 to ...


What Effect Does Free Trade In Agriculture Have On Developing Country Populations Around The World?, Jacinto F. Fabiosa Apr 2008

What Effect Does Free Trade In Agriculture Have On Developing Country Populations Around The World?, Jacinto F. Fabiosa

CARD Working Papers

Highlighted in the "battle in Seattle" in 1999, anti-trade sentiments still persist, even with development considerations placed at the core of reform negotiations at the World Trade Organization, in which two-thirds of the members are developing countries.

In this paper, the impact of agricultural trade liberalization on food consumption through changes in income and prices is considered. First, agricultural trade liberalization is estimated to raise economic growth by 0.43% and 0.46% in developing and industrialized countries, respectively. Since food consumption of households with lower income are more responsive to changes in income, their food consumption increases more under ...


Impact Of The South Korea-U.S. Free Trade Agreement On The U.S. Livestock Sector, Jacinto F. Fabiosa, Dermot J. Hayes, Fengxia Dong Nov 2007

Impact Of The South Korea-U.S. Free Trade Agreement On The U.S. Livestock Sector, Jacinto F. Fabiosa, Dermot J. Hayes, Fengxia Dong

CARD Working Papers

The recently signed Korea-U.S. Free Trade Agreement (KORUS FTA) grants the U.S. livestock industry with preferential access to South Korea's import market. This study evaluates the likely impacts of the KORUS FTA on the U.S. livestock sector.

Using the Food and Agricultural Policy Research Institute's modeling system, we find that livestock prices increase by 0.5% to 3.8% under the agreement. And together with an expansion by 381 to 883 million pounds in meat exports, the value of U.S. exports increase by close to U.S.$2 billion, or a 15.2% increase ...


Are Standards Always Protectionist?, Stéphan Marette, John C. Beghin Jun 2007

Are Standards Always Protectionist?, Stéphan Marette, John C. Beghin

CARD Working Papers

We analyze the effects of a domestic standard that reduces an externality associated with the consumption of the good targeted by the standard, using a model in which foreign and domestic producers compete in the domestic good market. Producers can reduce expected damage associated with the externality by incurring a cost that varies by source of origin. Despite potential protectionism, the standard is useful in correcting the consumption externality in the domestic country. Protectionism occurs when the welfare-maximizing domestic standard is higher than the international standard maximizing welfare inclusive of foreign profits. The standard is actually anti-protectionist when foreign producers ...


Welfare Impacts Of Cross-Country Spillovers In Agricultural Research, Sergio H. Lence, Dermot J. Hayes Apr 2007

Welfare Impacts Of Cross-Country Spillovers In Agricultural Research, Sergio H. Lence, Dermot J. Hayes

CARD Working Papers

The welfare implications of intellectual property protection (IPP) for private sector agricultural research are analyzed, focusing on the realistic cases in which countries provide different IPP levels, technology spills over across countries, and the public sector is involved in research. A model is developed to determine who benefits from, and who should pay for, the associated research. The paper contains some interesting results on the implications of a harmonization of IPP policies through multilateral agreements or via technology that allows research firms to prevent the copying of plants and animals that express traits that have emerged from their research.


Intra-Industry Trade, Multilateral Trade Integration, And Invasive Species Risk, Anh T. Tu, John C. Beghin Dec 2006

Intra-Industry Trade, Multilateral Trade Integration, And Invasive Species Risk, Anh T. Tu, John C. Beghin

CARD Working Papers

We analyze the linkage between protectionism and invasive species (IS) hazard in the context of two-way trade and multilateral trade integration, two major features of real-world agricultural trade. Multilateral integration includes the joint reduction of tariffs and trade costs among trading partners. Multilateral trade integration is more likely to increase damages from IS than predicted by unilateral trade opening under the classic Heckscher-Ohlin-Samuelson (HOS) framework because domestic production (the base susceptible to damages) is likely to increase with expanding export markets. A country integrating its trade with a partner characterized by relatively higher tariff and trade costs is also more ...


Nontariff Barriers, John C. Beghin Dec 2006

Nontariff Barriers, John C. Beghin

CARD Working Papers

Nontariff barriers (NTBs) refer to the wide range of policy interventions other than border tariffs that affect trade of goods, services, and factors of production. Most taxonomies of NTBs include market-specific trade and domestic policies affecting trade in that market. Extended taxonomies include macro-economic policies affecting trade. NTBs have gained importance as tariff levels have been reduced worldwide. Common measures of NTBs include tariff-equivalents of the NTB policy or policies and count and frequency measures of NTBs. These NTB measures are subsequently used in various trade models, including gravity equations, to assess trade and/or welfare effects of the measured ...


Removal Of U.S. Ethanol Domestic And Trade Distortions: Impact On U.S. And Brazilian Ethanol Markets, Amani E. Elobeid, Simla Tokgoz Oct 2006

Removal Of U.S. Ethanol Domestic And Trade Distortions: Impact On U.S. And Brazilian Ethanol Markets, Amani E. Elobeid, Simla Tokgoz

CARD Working Papers

We analyze the impact of trade liberalization and removal of the federal tax credit in the United States on U.S. and Brazilian ethanol markets using a multi-market international ethanol model calibrated on 2005 market data and policies. The removal of trade distortions induces a 23.2 percent increase in the price of world ethanol on average between 2006 and 2015 relative to the baseline. The U.S. domestic ethanol price decreases by 14.1 percent, which results in a 7.5 percent decline in production and a 3.2 percent increase in consumption. The lower domestic price leads to ...


U.S. Sugar Policy Options And Their Consequences Under Nafta And Doha, David Abler, John C. Beghin, David Blandford, Amani E. Elobeid Jun 2006

U.S. Sugar Policy Options And Their Consequences Under Nafta And Doha, David Abler, John C. Beghin, David Blandford, Amani E. Elobeid

CARD Working Papers

We analyze the potential impact of continuing the existing U.S. sugar program, replacing it with a standard program, and implementing the standard program with multilateral trade liberalization. Under the North American Free Trade Agreement (NAFTA), duty-free sugar imports from Mexico will undermine the program’s ability to operate on a “no-cost” basis to U.S. taxpayers. As the Mexican beverage industry is likely to expand considerably its highfructose corn syrup use, the sugar thereby displaced will seek a market in the United States. Under these conditions, marketing allotments could not be utilized under current legislation and prices would likely ...


Westernization Of The Asian Diet: The Case Of Rising Wheat Consumption In Indonesia, Jacinto F. Fabiosa Apr 2006

Westernization Of The Asian Diet: The Case Of Rising Wheat Consumption In Indonesia, Jacinto F. Fabiosa

CARD Working Papers

With sustained income growth and fast urbanization, Indonesia will see a major shift in the growth of grain consumption from rice to wheat products. New demand estimates from consumption survey data give a relatively high income elasticity of demand for wheat-based products, in the range of 0.44 to 0.84, with 26% to 34% of this response coming from the impact of income on the probability of consumption for non-consuming households and the remaining impact coming from the response on the level of consumption for households currently consuming wheat products. Urban location of households also contributes an increase of ...


U.S. Proposal For Wto Agriculture Negotiations: Its Impact On U.S. And World Agriculture, Food And Agricultural Policy Research Institute Dec 2005

U.S. Proposal For Wto Agriculture Negotiations: Its Impact On U.S. And World Agriculture, Food And Agricultural Policy Research Institute

CARD Working Papers

Senator Chambliss, chair of the U.S. Senate Committee on Agriculture, Nutrition, and Forestry, asked the Food and Agricultural Policy Research Institute (FAPRI) to analyze the latest U.S. proposal to the Doha round of WTO negotiations (see Appendix 1, U.S. Proposal for WTO Agriculture Negotiations, USTR, October 10, 2005). While the U.S. proposal provides many concrete steps to reduce farm support and trade distortions, it does not provide all necessary information for quantitative analysis of the proposal. FAPRI, through consultations with economists and staffers of the U.S. Senate Committee on Agriculture, Nutrition and Forestry, Office of ...


Tariff Equivalent Of Technical Barriers To Trade With Imperfect Substitution And Trade Costs, Chengyan Yue, John C. Beghin, Helen H. Jensen Nov 2005

Tariff Equivalent Of Technical Barriers To Trade With Imperfect Substitution And Trade Costs, Chengyan Yue, John C. Beghin, Helen H. Jensen

CARD Working Papers

The price-wedge method yields a tariff-equivalent estimate of technical barriers to trade (TBT). An extension of this method accounts for imperfect substitution between domestic and imported goods and incorporates recent findings on trade costs. We explore the sensitivity of this revamped tariff-equivalent estimate to its determinants (substitution elasticity, preference for home good, trade cost, and to the reference data chosen). We use the approach to investigate the ongoing U.S.-Japan apple trade dispute and find that removing the Japanese TBT would yield limited export gains to the United States. We then draw policy implications of our findings.


Eu Enlargement And Technology Transfer To New Member States, Simla Tokgoz Nov 2005

Eu Enlargement And Technology Transfer To New Member States, Simla Tokgoz

CARD Working Papers

The European Union (EU) accomplished its biggest enlargement process in 2004 in terms of the number of countries, area, and population. This study focuses on the impact of enlargement, the resulting technology transfer on the grain sectors of the New Member States (NMS), and the consequent welfare implications. The study finds that EU enlargement has important implications for the EU and the NMS, but its impact on the world grain markets is minimal. The results show that producers in the NMS gain from accession because of higher prices, whereas consumers in most NMS face a welfare loss. Incorporating technology transfer ...


Tariff Escalation And Invasive Species Risk, Anh T. Tu, John C. Beghin, Estelle Gozlan Oct 2005

Tariff Escalation And Invasive Species Risk, Anh T. Tu, John C. Beghin, Estelle Gozlan

CARD Working Papers

We investigate the interface between trade and invasive species (IS) risk, focusing on the existing tariff escalation in agro-forestry product markets and its implication for IS risk. Tariff escalation in processed agro-forestry products exacerbates the risk of IS by biasing trade flows toward increased trade of primary commodity flows and against processed-product trade. We show that reducing tariff escalation by lowering the tariff on processed goods increases allocative efficiency and reduces the IS externality, a win-win situation. We also identify policy menus for trade reforms involving tariffs on both raw input and processed goods, leading to winwin situations.


Multilateral Trade And Agricultural Policy Reforms In Sugar Markets, Amani E. Elobeid, John C. Beghin Sep 2005

Multilateral Trade And Agricultural Policy Reforms In Sugar Markets, Amani E. Elobeid, John C. Beghin

CARD Working Papers

We analyze the impact of trade liberalization, removal of production subsidies, and elimination of consumption distortions in world sugar markets using a partial-equilibrium international sugar model calibrated on 2002 market data and current policies. The removal of trade distortions alone induces a 27% price increase while the removal of all trade and production distortions induces a 48% increase by 2011/12 relative to the baseline. Aggregate trade expands moderately, but location of production and trade patterns change substantially. Protectionist OECD countries (the EU, Japan, the US) experience an import expansion or export reduction and significant contraction in production in unfettered ...


Growing Demand For Animal-Protein-Source Products In Indonesia: Trade Implications, Jacinto F. Fabiosa Jul 2005

Growing Demand For Animal-Protein-Source Products In Indonesia: Trade Implications, Jacinto F. Fabiosa

CARD Working Papers

New elasticities were estimated from Indonesia's 1996, 1999, and 2002 National Socio-Economic Survey, or SUSENAS, data using a double-hurdle demand specification. The estimates suggest that major changes in Indonesian household diets are expected in the coming years, as income growth is sustained and as urbanization proceeds at a fast pace. The consumption "trading-up" pattern for animal-protein source products observed in many countries may also occur in Indonesia. In this particular case, households will shift from fish to dairy and meat products. The trade impacts of this emerging consumption pattern will be determined by the cost of adjustment in Indonesia ...