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Type: Journal article
Title: Agricultural trade distortions during the global financial crisis
Author: Anderson, K.
Nelgen, S.
Citation: Oxford Review of Economic Policy, 2012; 28(2):235-260
Publisher: Oxford Univ Press
Issue Date: 2012
ISSN: 0266-903X
Statement of
Kym Anderson and Signe Nelgen
Abstract: Import barriers are often raised during turbulent times, as governments worry about immediate domestic concerns such as unemployment. The recent global financial crisis, however, was accompanied by an exogenous upward spike in the international price of food, which led some countries to raise export barriers, thereby exacerbating both the price spike and the international welfare transfer associated with that change in the terms of trade. As in previous price-spike periods, that response by some food-exporting countries was accompanied by a lowering of import restrictions by numerous food-importing countries, further exacerbating the international price spike. This paper provides new evidence up to 2010 on the extent of the change in domestic relative to international prices in both groups of countries, and compares it with responses during two previous food price-spike periods. It concludes that there is a need for stronger World Trade Organization disciplines on export as well as import restrictions, so as to limit the extent to which beggar-thy-neighbour government responses to international price spikes (up or down) exacerbate those shocks.
Keywords: domestic market insulation
distorted incentives
international price transmission
commodity price stabilization
Rights: © The Authors 2012. Published by Oxford University Press.
DOI: 10.1093/oxrep/grs001
Appears in Collections:Aurora harvest
Economics publications

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