The Trade and Welfare Impacts of Australian Quarantine Policies: The Case of Pigmeat

16 Pages Posted: 9 Aug 2012

See all articles by John Beghin

John Beghin

University of Nebraska Lincoln Agricultural Economics; Iowa State University - Department of Economics

Mark Melatos

University of Sydney Business School

Date Written: August 2012

Abstract

We analyse the trade and welfare impact of quarantine measures imposed by Australia on imports of pigmeat. In particular, we account for changes to Australia’s pigmeat quarantine policy over time including those changes related to the recent resolution of a WTO dispute between Australia and the European Union. Using a random utility model, and applying it to corner solutions in import decisions, tariff equivalents (by major trading partner) are estimated for the different pigmeat quarantine regimes implemented by Australia during the period 1988–2009. The welfare impact on consumers, producers and foreign exporters is computed using a partial equilibrium model calibrated on the econometric estimates. The quarantine regimes had a strong effect on trade and welfare with a tariff equivalent above 113 per cent of average real‐world prices over the period analysed.

Suggested Citation

Beghin, John and Melatos, Mark, The Trade and Welfare Impacts of Australian Quarantine Policies: The Case of Pigmeat (August 2012). The World Economy, Vol. 35, Issue 8, pp. 1006-1021, 2012. Available at SSRN: https://ssrn.com/abstract=2127003 or http://dx.doi.org/10.1111/j.1467-9701.2012.01459.x

John Beghin (Contact Author)

University of Nebraska Lincoln Agricultural Economics ( email )

Lincoln, NE 68583
United States

Iowa State University - Department of Economics ( email )

383 Heady Hall
Ames, IA 50011
United States

Mark Melatos

University of Sydney Business School ( email )

Cnr. of Codrington and Rose Streets
Sydney, NSW 2006
Australia

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