Developing Countries and the Gains from Regionalism: Links between Trade and Farm Policy Reforms in Mexico.
We use a multi-country computable general equilibrium (CGE) model with agricultural policy details to simulate the effects of North American Free Trade Agreement (NAFTA). We find that Mexico gains from NAFTA only when it also removes domestic distortions in agriculture. In that case, agriculture can generate allocative efficiency gains large enough to offset the terms of trade losses that arise because Mexico has higher initial tariffs than its NAFTA partners. When an RTA forces a developing country to reform its domestic distortions that are linked to trade restrictions, it becomes a building block toward multilateralism. Copyright 2002 by American Agricultural Economics Association
Year of publication: |
2002
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Authors: | Burfischer, Mary E ; Robinson, Sherman ; Thierfelder, Karen |
Published in: |
American Journal of Agricultural Economics. - American Agricultural Economics Association. - Vol. 84.2002, 3, p. 736-48
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Publisher: |
American Agricultural Economics Association |
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