Formulas and Flexibility in Trade Negotiations:Sensitive Agricultural Products in the Wto's Doha Agenda

36 Pages Posted: 20 Apr 2016

See all articles by Sebastien Jean

Sebastien Jean

UMR Economie Publique INRA-AgroParisTech

David Laborde

International Food Policy Research Institute (IFPRI)

Will J. Martin

International Food Policy Research Institute (IFPRI)

Date Written: February 1, 2010

Abstract

Many trade negotiations involve large cuts in high tariffs, with flexibilities allowing much smaller cuts for an agreed number of politically-sensitive products. The effects of these flexibilities on market access opportunities are difficult to predict, creating particular problems for developing countries in assessing whether to support a proposed agreement. Some widely-used ad hoc approaches to identifying likely sensitive products -- such as the highest-bound-tariff rule -- suggest that the impacts of a limited number of such exceptions on average tariffs and on market access are likely to be minor. This paper uses a rigorous specification based on the apparent objectives of policy makers in setting the pre-negotiation tariff. Applying this approach with detailed data allows the authors to assess the implications of sensitive-product provisions for average agricultural tariffs, economic welfare, and market access under the Doha negotiations. The authors conclude that highest-tariff rules are likely to seriously underestimate the impacts on average tariffs, and that treating even 2 percent of tariff lines as sensitive is likely to have a sharply adverse impact on economic welfare. The impacts on market access are also adverse, but much smaller, perhaps reflecting the mercantilist focus of the negotiating process.

Keywords: Free Trade, International Trade and Trade Rules, Markets and Market Access, Debt Markets, Trade Policy

Suggested Citation

Jean, Sebastien and Laborde, David and Martin, William J., Formulas and Flexibility in Trade Negotiations:Sensitive Agricultural Products in the Wto's Doha Agenda (February 1, 2010). World Bank Policy Research Working Paper No. 5200, Available at SSRN: https://ssrn.com/abstract=1559717

Sebastien Jean

UMR Economie Publique INRA-AgroParisTech ( email )

Centre de Grignon
BP01
Thiverval-Grignon, 78850
France

HOME PAGE: http://www.cepii.fr/anglaisgraph/pagepers/websj/cvwebsj.htm

David Laborde

International Food Policy Research Institute (IFPRI) ( email )

United States

William J. Martin

International Food Policy Research Institute (IFPRI) ( email )

1201 Eye St, NW,
Washington, DC 20005
United States

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