Description: Do Trade Agreements Reduce the Volatility of Agricultural Distortions?

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Do Trade Agreements Reduce the Volatility of Agricultural Distortions?

The objective of this paper is to evaluate the extent to which trade agreements affect agricultural trade policy volatility. Using a new panel database compiled as part of the World Bank's agricultural distortions research project, the author...

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Bibliographic Details
Main Authors:	Cadot, Olivier, Olarreaga, Marcelo, Tschopp, Jeanne
Language:	English en_US
Published:	World Bank, Washington, DC 2017
Subjects:	ABSOLUTE VALUE ACCORDS AGRICULTURAL AGREEMENT AGRICULTURAL INCENTIVES AGRICULTURAL PRODUCTION AGRICULTURAL PRODUCTS AGRICULTURAL TRADE AGRICULTURE AVERAGE TRADE BILATERAL TRADE BILATERAL TRADE AGREEMENTS BORDER MEASURES BORDER POLICY CHANGES IN TRADE COMMODITY COMMON MARKET CONCESSIONS CONSUMERS COUNTRY DUMMIES COUNTRY FIXED EFFECTS CUSTOMS CUSTOMS UNION DEMAND ELASTICITIES DEMAND ELASTICITY DEVELOPED COUNTRIES DEVELOPING COUNTRIES DEVELOPING COUNTRY DEVELOPING REGIONS DIVIDENDS DOMESTIC LAW DOMESTIC MARKETS DOMESTIC PRICE DOMESTIC PRODUCTION DUMPING ECONOMIC POLICY ECONOMIC SIZE ECONOMIC THEORY ENVIRONMENTAL ISSUES EQUILIBRIUM EUROPEAN UNION EXPORT DEMAND EXPORT TAX EXPORT TAXES EXPORTS FOOD PRICES FOREIGN DIRECT INVESTMENT FREE ACCESS FREE TRADE FREE TRADE AREAS FREE-TRADE AGREEMENTS GDP GENERAL AGREEMENT ON TARIFFS GRAVITY EQUATION IMPACT OF TRADE IMPORT TAXES IMPORTS INCOME INSURANCE INTERNATIONAL ECONOMICS INTERNATIONAL TRADE MACROECONOMIC SHOCKS MARKET ACCESS MEASURE OF TRADE MEASURES OF VOLATILITY MULTILATERAL LIBERALIZATION MULTILATERAL NEGOTIATIONS NON-TARIFF BARRIERS OPEN ECONOMIES OUTPUT PARLIAMENTARY DEMOCRACIES POLITICAL ECONOMY POLITICAL REGIMES PREFERENTIAL AGREEMENT PREFERENTIAL AGREEMENTS PREFERENTIAL TRADE PREFERENTIAL TRADE AGREEMENTS PREFERENTIAL TREATMENT PRICE DISTORTIONS PRICE VOLATILITY PROTECTION MEASURES REGIONAL AGREEMENTS REGIONAL INTEGRATION REGIONAL INTEGRATION AGREEMENTS REGIONAL TRADE REGIONAL TRADE AGREEMENTS REGIONALISM REGIONALIZATION RULES OF ORIGIN SECURITY CONCERNS SOCIAL WELFARE TARIFF CHANGES TAX TERMS OF TRADE TRADE AGREEMENT TRADE AGREEMENTS TRADE BARRIERS TRADE DISTORTIONS TRADE EXTERNALITIES TRADE FLOWS TRADE IN SERVICES TRADE OBJECTIVES TRADE POLICIES TRADE POLICY TRADE PROMOTION TRADE PROTECTION TRADE REGIME TRADE REGIMES TRADE RULES TRADE SHOCKS TRADING SYSTEM TREATIES URUGUAY ROUND VALUE OF TRADE VOTERS WORLD ECONOMY WORLD PRICES WORLD TRADE WTO
Online Access:	http://documents.worldbank.org/curated/en/904201468336324013/Do-trade-agreeements-reduce-the-volatility-of-agricultural-distortions http://hdl.handle.net/10986/28165

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Summary:	The objective of this paper is to evaluate the extent to which trade agreements affect agricultural trade policy volatility. Using a new panel database compiled as part of the World Bank's agricultural distortions research project, the author estimate the effect of regionalism on the volatility of price distortions measured by the absolute value of their first differences, averaged, for each country and year, over all agricultural goods. Using an instrumental-variable approach to correct for the endogeneity of regional trade agreements, (RTAs), the author fined that participation in RTAs has a significantly negative effect on agricultural trade-policy volatility. The author find that the World Trade Organization (WTO) agricultural agreement also contributed to reducing agricultural trade-policy volatility, in spite of the weak disciplines involved, but the effect is only weakly identified. The results are robust to a variety of robustness checks and hold, in particular, for the Latin American sub-sample.