ANALYSIS OF IMPACT ON DOMESTIC AGRICULTURE OF WTO MARKET ACCESS POLICY WITH THE HAMI SIMULATION MODEL

A simple but new theoretical approach is used to analyse ex-ante the impact of tariff reduction. Thismethodology is based on the assumption of a constant price relation between each direct substitutableproduct. No elasticities are needed, but accurate import and domestic prices of the most sensitive andrepresentative product of each tariff line are required. The present contribution forms a partial sectorstatic simulation model that minimises the reduction of domestic production prices for the agriculturalsector consecutive of the WTO market access negotiations of the Doha round. Results are shown ontwo levels whereas one of them provides rapidly a preliminary hierarchy of the sensitive productstariff lines and their optimal number. The second level provides a post-WTO maximal domestic pricefor aggregated products for which demand and supply elasticities are known. These maximal pricescan be used as exogenous variable in dynamic models.