Policy Bias and Agriculture: Partial and General Equilibrium Measures

Review of Development Economics 5(1):89 - 104. DOI: 10.1111/1467-9361.00109

Posted: 13 Dec 2014

See all articles by Sherman Robinson

Sherman Robinson

International Food Policy Research Institute (IFPRI)

Finn Tarp

University of Copenhagen - Department of Economics

Peter Wobst

Independent

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Date Written: January 2001

Abstract

The paper examines the impact of industrial protection, agricultural export taxes, and overvaluation of the exchange rate on the balance between the agricultural and nonagricultural sectors. Various agricultural terms-of-trade indices are constructed to measure the policy bias against agriculture in a computable general equilibrium (CGE) framework and compare the results with earlier partial equilibrium measures. Our results indicate that the partial equilibrium measures miss much of the action operating through indirect product and factor market linkages, while overstating the strength of the linkages between changes in the exchange rate and prices of traded goods on the agricultural terms of trade.

Suggested Citation

Robinson, Sherman and Tarp, Finn and Wobst, Peter, Policy Bias and Agriculture: Partial and General Equilibrium Measures (January 2001). Review of Development Economics 5(1):89 - 104. DOI: 10.1111/1467-9361.00109 , Available at SSRN: https://ssrn.com/abstract=2537751

Sherman Robinson

International Food Policy Research Institute (IFPRI) ( email )

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

Finn Tarp (Contact Author)

University of Copenhagen - Department of Economics ( email )

Ă˜ster Farimagsgade 5
Bygning 26
1353 Copenhagen K.
Denmark

Peter Wobst

Independent

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