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Article
Publication date: 11 September 2009

Faiz M. Shaikh

The purpose of this paper is to quantify and analyze the relative impact of agriculture Trade liberalization and South Asian Free Trade Agreement (SAFTA) over the global…

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Abstract

Purpose

The purpose of this paper is to quantify and analyze the relative impact of agriculture Trade liberalization and South Asian Free Trade Agreement (SAFTA) over the global economic welfare. The objectives are to analyze and quantify the potential economic cost and benefits of the prospective trade between India and Pakistan to consumers, producers and government of the two countries by analyzing the potential economic costs and benefits of Pak‐India trade in exporting various consumer goods.

Design/methodology/approach

The Global Trade Analysis Project (GTAP) database is the database for the GTAP model of the world economy, which is publicly available. The main data source for this model is “The GTAP 4 Data Base” which is easy to adapt to appropriate sectoral and regional aggregations that allow one to focus on specific policy questions. The regional databases in the model are derived from individual country input‐output (I/O) tables that provide information about the individual regional economies in the model. The bilateral trade data are primarily derived from the United Nations Commodity Trade database. The economic research service (ERS) of the United States Department of Agriculture supplies the missing information in the UN trade data.

Findings

The first scenario is when normal trading relations with India will be restored; it means that each country will give the most‐favored‐nations (MFN) status to the other. In the second scenario, the SAFTA will be operative, and there will be free trade between India and Pakistan, and both countries will remove all tariffs and custom duties from each other's imports. The GTAP model is used to analyze the possible impact of SAFTA on Pakistan in a multi‐country, multi‐sector applied general equilibrium framework.

Originality/value

The analysis based on simulations reveals that current demand for Pakistani consumer items will expand after the free trade agreement (FTA) and consumer surplus will increase. The export of consumer items may be conducted by two scenarios, i.e. when normal trading relations between Pakistan and India will be restored and when there will be a free trade between Pakistan and India in the presence of SAFTA. Results based on this research reveal that, on SAFTA grounds, there will be net export benefits in Pakistan's economy.

Details

Journal of International Trade Law and Policy, vol. 8 no. 3
Type: Research Article
ISSN: 1477-0024

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Book part
Publication date: 24 September 2010

Alla Golub, Thomas W. Hertel, Farzad Taheripour and Wallace E. Tyner

Over the past decade, biofuels production in the European Union and the United States has boomed – much of this due to government mandates and subsidies. The United States…

Abstract

Over the past decade, biofuels production in the European Union and the United States has boomed – much of this due to government mandates and subsidies. The United States has now surpassed Brazil as the world's leading producer of ethanol. The economic and environmental impact of these biofuel programs has become an important question of public policy. Due to the complex intersectoral linkages between biofuels and crops, livestock as well as energy activities, CGE modeling has become an important tool for their analysis. This chapter reviews recent developments in this area of economic analysis and suggests directions for future research.

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New Developments in Computable General Equilibrium Analysis for Trade Policy
Type: Book
ISBN: 978-0-85724-142-9

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Article
Publication date: 8 February 2013

Krishna Chikhuri

The aim of this paper is to deal with the linkage between agricultural trade liberalization and food security in Sub‐Saharan Africa.

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Abstract

Purpose

The aim of this paper is to deal with the linkage between agricultural trade liberalization and food security in Sub‐Saharan Africa.

Design/methodology/approach

The analysis uses the GTAP model which is a global dynamic applied general equilibrium model to assess how the multifarious trade and support policies in agriculture affect the poor in the Sub‐Saharan African group based on food security concerns. The policy strategies analyzed are two liberalization scenarios based on the proposals made in the present round of agricultural negotiations in terms of market access and export competition, plus a free agricultural trade benchmark scenario.

Findings

The results of alternative trade liberalization strategies on key food security indicators in the SSA region are ambiguous. The impact varies depending on the extent of liberalization and also the comparative advantage of the SSA group at the sectoral level.

Originality/value

Despite several studies on food security, especially after the food crisis in 2008, very little research has focussed on the agricultural trade liberalization impact with a CGE approach.

Details

International Journal of Social Economics, vol. 40 no. 3
Type: Research Article
ISSN: 0306-8293

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Article
Publication date: 29 July 2014

Chanwahn Kim, Mohammad Masudur Rahman and Laila Arjuman Ara

– The purpose of this paper is to investigate the potential economic effects of the proposed Bangladesh-India free trade agreement (FTA).

Abstract

Purpose

The purpose of this paper is to investigate the potential economic effects of the proposed Bangladesh-India free trade agreement (FTA).

Design/methodology/approach

The authors have used the computable general equilibrium (CGE) analysis of Global Trade Analysis Project (GTAP) database. The analysis highlights the possible costs and benefits of the two nations within three different scenarios. Under Scenario I all bilateral import tariffs between Bangladesh and India are removed; Scenario II represents the setting where Bangladesh cuts its all tariffs by 75 and in Scenario III Bangladesh cuts tariffs by 50 percent. India cuts all their tariffs by 100 percent in all three scenarios.

Findings

The findings indicate that India may gain more in terms of welfare and real GDP via the improved terms of trade while Bangladesh is going to have welfare loss, but if Bangladesh is able to make a preferential FTA like Scenario III with India its welfare, real GDP and exports will be increased substantially.

Originality/value

This paper is the first-ever attempt to estimate the effect of the proposed Bangladesh-India FTA using CGE analysis of GTAP database version 7.

Details

South Asian Journal of Global Business Research, vol. 3 no. 2
Type: Research Article
ISSN: 2045-4457

Keywords

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Book part
Publication date: 15 July 2017

Farzad Taheripour and Wallace E. Tyner

The purpose of this chapter is to ask and answer the question of what would happen if Genetically Modified Organism (GMO) plant materials were banned. We report on two…

Abstract

The purpose of this chapter is to ask and answer the question of what would happen if Genetically Modified Organism (GMO) plant materials were banned. We report on two studies – one with United States only ban and one with a global ban. We used a global computable general equilibrium (CGE) model, Global Trade Analysis Project (GTAP), for the analysis. This model has been used in hundreds of published papers on trade, energy, land use, and environmental issues. Our use of the model was to estimate the crop yield benefits for the major GMO crops, and then to convert this to a loss if the GMO traits were banned. We then shocked the GTAP model with the yield losses and estimate economic, land use, and greenhouse gas (GHG) emission impacts. We found that losing the GM technology would cause commodity and food prices to increase and also bring about a significant increase in GHG emissions. The increase in emissions is caused by the need to convert forest and pasture to compensate for the lost production. Another interesting conclusion of the global ban study is that economic well-being for the United States, the world’s largest GMO user, actually increases with a ban. Many regions that ban or use little GMO varieties like the European Union, India, China, and Japan all see economic well-being decrease. These counterintuitive results are driven mainly by trade patterns. Therefore GMO technology helps agriculture reduce its carbon footprint. Without this technology, agricultural land-use GHG emissions increase as do food prices. Some groups would like to see GMOs banned and also see GHG emissions fall. You cannot have it both ways.

Details

World Agricultural Resources and Food Security
Type: Book
ISBN: 978-1-78714-515-3

Keywords

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Abstract

Details

The Political Economy of Policy Reform: Essays in Honor of J. Michael Finger
Type: Book
ISBN: 978-0-44451-816-3

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Book part
Publication date: 15 July 2017

Abstract

Details

World Agricultural Resources and Food Security
Type: Book
ISBN: 978-1-78714-515-3

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Article
Publication date: 20 June 2016

Sheng Lu

This study aims to empirically investigate the potential impact of the Trans-Pacific Partnership (TPP) on US textile and apparel manufacturing.

Abstract

Purpose

This study aims to empirically investigate the potential impact of the Trans-Pacific Partnership (TPP) on US textile and apparel manufacturing.

Design/methodology/approach

This study adopts the Global Trade Analysis Project (GTAP) computable general equilibrium model based on the latest GTAP9 database.

Findings

The findings of the study suggest that: the “yarn-forward” rule will not work effectively in the context of TPP; and the development of Vietnam’s local textile industry is a critical threat to the survival of US textile and apparel (T&A) manufacturing in the long run.

Originality/value

The findings of the study augment the understanding of the T&A-specific sectoral impact of TPP and address the particular concerns of the US T&A manufacturers with regard to the new business environment and the possible scenarios after the implementation of the agreement.

Details

Journal of International Trade Law and Policy, vol. 15 no. 2/3
Type: Research Article
ISSN: 1477-0024

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Book part
Publication date: 24 September 2010

John Gilbert and Reza Oladi

South Asia is one of the world's poorest regions. In this chapter we use a representative household model of South Asia to explore the potential impacts of regional trade…

Abstract

South Asia is one of the world's poorest regions. In this chapter we use a representative household model of South Asia to explore the potential impacts of regional trade liberalization under the auspices of SAFTA on both the distribution of economic gains across the countries of South Asia, and across various groups within South Asia. We also discuss the underlying theory of a potential extension to our approach.

Details

New Developments in Computable General Equilibrium Analysis for Trade Policy
Type: Book
ISBN: 978-0-85724-142-9

Keywords

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Book part
Publication date: 4 April 2005

Lall Ramrattan, Aron A. Gottesman and Michael Szenberg

The purpose of this study is to investigate the relationship between the flow of funds and growth variables for Latin America during the period of 1973–2000. To do so, we…

Abstract

The purpose of this study is to investigate the relationship between the flow of funds and growth variables for Latin America during the period of 1973–2000. To do so, we present a four equation econometric model that represents the traditional Monetarist and Keynesian perspectives. We also examine the hypothesis that the region can grow through gains from trade, through investigating trade as a source of growth from both computational general equilibrium (CGE) and Cournot-Nash equilibrium standpoints. Analyzing several scenarios, we determine that liberalization and reduced protectionism are superior strategies for Latin America.

Details

Latin American Financial Markets: Developments in Financial Innovations
Type: Book
ISBN: 978-1-84950-315-0

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