the environmental effects of agricultural trade liberalization in latin america an interpretation abstract the trade and environment debate has focused attention on the possible contradiction between promoting free markets while meeting domestic environmental objectives this paper takes a view from the south recent econometric models predict net effects of expanded agricultural trade to be positive for the global environment yet further pressure on degraded resources and marginal farmers and a reinforcement of sectoral policies that benefit commercial export crop growers as opposed to food producers may make increased trade more of a bane than a blessing for developing countries in the context of emerging regional trading blocks in latin america nafta and mercosur removal of trade barriers between participating nations has led to dislocation of production whose localized impacts it is hoped would be resolved through reconversion of agriculture in affected subregions it may be however that internalization of socio environmental costs of such dislocation would indicate that production despite competitive disadvantages would best have been left where it was to gain a better empirical understanding of the links between agricultural trade policy and the environment will require prediction of ecosystem stresses anticipated from alterations in how producers grow crops in specific geophysical settings rather than reliance on stylized facts

input versus emission taxes environmental taxes in a mass balance and transaction costs perspective the standard policy recommendation to limit pollution is to use taxes or tradeable quotas on emissions a general emphasis on emissions does not however take proper account of the characteristics of the material flow through the economy an analysis of the relationships between transaction costs and features of this flow shows that it may be less costly to tax inputs into the economy the paper focuses on the advantages of a mass flow perspective in environmental economics the trade off between the precision of an environmental regulation and its implementation costs and develops criteria for choosing between input and emission related instruments

deep integration and production networks an empirical analysis this paper investigates the two way relationship between deep integration and production networks trade we capture deep integration with a set of indices constructed in terms of policy areas covered in preferential trade agreements we estimate an augmented gravity equation to investigate the impact of deep integration on production networks trade the results show that on average signing deeper agreements increases production networks trade between member countries by almost 12 percentage points in addition the impact of deep integration is higher for trade in automobile parts and information and technology products compared with textile products to analyse whether higher levels of network trade increase the likelihood of signing deeper agreements we follow the literature on the determinants of preferential trade agreements the estimation results show that after taking into account other pta determinants a ten percentage increase in the share of production network trade over total trade increases the depth of an agreement by approximately 6 percentage points in addition the probability of signing deeper agreements is higher for country pairs involved in north south production sharing and for countries belonging to the asia region

ecologically accelerated trade liberalisation a set of disciplines for environment and trade agreements abstract a set of disciplines strict guidelines for environmental agreements that affect trade objectives and trade agreements that affect environmental objectives is developed recognising the advantages of further liberalising world trading conditions and encouraging countries to pursue national solutions to environmental problems a new form of international agreement is proposed they deal with products that are like in every way except for the way they are produced such agreements would simultaneously accelerate progress towards more liberal trading conditions improve environmental quality and give economic advantage to those who pursue vigorous tightly targeted domestic environmental policies these ecologically accelerated trade liberalisation agreements eatlas are perceived to be of particular interest to nations not well placed to enter into a regional free trade agreement or join a common market the case for a gatt code or protocol on production process standards and international agreements on the environment is examined

issues relating to agricultural pricing policies and their analysis in developing countries abstract agricultural pricing policies in developing countries are often the result of complex interactions between producer consumer and merchant groups and their relative effectiveness in influencing government decision making even within governments various ministries often have opposing views in this environment one of the contributions a policy analyst can make is to attempt to quantify the effects of different policy options this permits a more informed discussion which hopefully leads to better decision making and an improved incentive environment many analyses of agricultural pricing policies have used the standard partial equilibrium analysis where no linkages between commodity markets were considered in this paper we have considered cross price effects also we have discussed issues relating to other adjustments refinements of the standard method so that a practitioner not familiar with the various methods can form an opinion of what the options are and what adjustments may be appropriate for a particular case in question the adjustments relate to overvaluation of currencies input price distortions differences in the degree of distortions between producers and consumers and variability of border prices the inclusion of cross price elasticities was important for assessing production consumption and trade effects for argentina but for the other countries it resulted in only somewhat improved accuracy the adjustment for exchange rates had a large impact in egypt and was important for other countries as well this underlines the importance of exchange rates as key variables for agricultural pricing policies in general the numbers show that the traditional taxation policies of agricultural products in the sample of developing countries is somewhat less widespread than in the past these policies however continue to favor consumers over producers with significant losses for some of the latter the large size of welfare losses especially compared to efficiency losses highlights the importance of correcting distorted prices that adversely affect the poorest sections of society also the usual government objective of taxing producers to raise revenues is frequently defeated by the large subsidies provided to consumers for the partitioner for whom time is often of the essence the assessment of welfare effects using the partial equilibrium method may provide reasonably good first cut estimates of the order of magnitude of the impact of distortions but often these base case estimates can and should be adjusted for a number of possible factors the analyst needs to determine how important accurate estimates of key variables are to the policy makers he or she then needs to compare the costs involved in generating or gathering the data and doing the calculations with the benefits of a broader and more accurate analysis of the distortionary effects of the particular case in question

agri environmental policy and urban development patterns a general equilibrium analysis this paper investigates the spatial effects that the provision of environmental public goods have on residential location choices in a suburban context specifically a spatial general equilibrium framework is developed to analyze the consequences of adopting an agri environmental policy promoting the provision of positive farming externalities we use a static monocentric model of an open city where agricultural bid rents and agricultural amenities vary endogenously in space and where the positive externalities associated with agricultural production are valued by households consistent with empirical evidence of the potential side effects that conservation policies may have in terms of urbanization patterns and land price changes we show that under certain conditions implementing an agri environmental policy may promote additional suburban development moreover we demonstrate that the emergence of disconnected suburban areas may be significantly influenced by the location of land regulated by an agri environmental policy finally we discuss distributional aspects and show that while introducing an agri environmental policy has a negative impact on most residential land value it can have positive effects on farmland and residential land located within the regulated areas suggesting the non neutrality of such policies regarding the agents assets

agricultural externalities and environmental regulation evaluating good practice in citrus production economic activity takes place in a scenario characterized by an increasing number of environmental regulations aimed at bringing under control the emission of contaminating wastes in this paper we evaluate the impact of transforming a code of good practice in nitrogen fertilization on spanish citrus fruit farms into an environmental regulation of compulsory fulfilment using data envelopment techniques we calculate unrestricted and environmentally regulated short run maximum profits both profit values are then used to compute an index of the cost of regulation our results suggest that the cost of shifting from a merely recommended practice to a binding rule is low on average the loss of profit computed is only about 4 furthermore we find that farms overall efficiency is low and that the current gap between observed and regulated fertilization practices could be overcome by improving overall management efficiency

curbing agricultural exceptionalism the eu s response to external challenge from 1948 to 1994 the agricultural sector was afforded special treatment in the gatt we analyse the extent to which this agricultural exceptionalism was curbed as a result of the gatt uruguay round agreement on agriculture discuss why it was curbed and finally explore the implication of this for eu policy making we argue that in particular two major changes in gatt institutions brought about restrictions on agricultural exceptionalism first the uruguay round was a single undertaking in which progress on other dossiers was contingent upon an outcome on agriculture the eu had keenly supported this new decision rule in the gatt within the eu this led to the macsharry reforms of the common agricultural policy cap in 1992 paving the way for a trade agreement on agriculture within the gatt second under the new quasi judicial dispute settlement procedure countries are expected to bring their policies into conformity with wto rules or face retaliatory trade sanctions this has brought about a greater willingness on the part of the eu to submit its farm policy to wto disciplines

ranking farms with a composite indicator of sustainability the assessment of sustainability at farm level has been growing in popularity over the last few years this article contributes to this line of research by building up composite indicators for different facets social economic environmental and global of farm sustainability using a methodological approach that combines data envelopment analysis dea and multicriteria decision making mcdm methods and assigns common weights to each individual sustainability indicator this approach is applied to a database of 163 farms located in the campos county a region belonging to the dry lands of the spanish northern plateau using 12 individual indicators of sustainability our findings show that both economic and environmental composite sustainability indicators are positively correlated but that this is not the case for the social indicator we also check the influence of a set of variables on farm sustainability using bootstrapping statistical techniques and showing that increasing farm size membership in agricultural cooperatives and farmers medium and upper agricultural specific technical education all exert a significant positive influence on sustainability these results provide clues for policy makers that intend to design sustainability increasing structural agricultural policies

the impact of ftas on mena trade in agricultural and industrial products abstractthis article analyses the impact of free trade agreements ftas on middle east and north african countries mena trade for the period 1994 2010 the analysis distinguishes between industrial and agricultural trade to take into account the different liberalization schedules an augmented gravity model is estimated using up to date panel data techniques to control for all time invariant bilateral factors that influence bilateral trade as well as for the so called multilateral resistance factors we also control for the endogeneity of the agreements and test for self selection bias due to the presence of zero trade in our sample the main findings indicate that north south ftas and south south ftas have a differential impact in terms of increasing trade in mena countries with the former being more beneficial in terms of exports for mena countries but both showing greater global market integration we also find that ftas that include agricultural products in which mena countries have a clear comp

financial instruments for consumption smoothing by commodity dependent exporters given the substantial instability in all primary commodity markets one would expect countries that depend on a single primary export for most of their foreign earnings to experience especially sharp fluctuations in export earnings and their underlying wealth to the extent that these fluctuations affect consumption they are costly and we would expect such countries to seek ways of managing these fluctuations and reducing their costs in many countries the nature of the resource endowment and its comparative advantage rule out production diversification as a significant near term strategy and we assume it away here in addition we rule out diversification via exchange of equity investments with foreigners in this paper we consider the cost of export risk and show the potential contribution of commodity bonds in this context we show that in theory appropriate commodity bonds can in fact achieve optimal smoothing of i i d export price disturbances if that is what countries really want or need commodity bonds c bonds are bonds whose principal repayment and perhaps dividend payments may be made in units of physical commodity or the terminal value of some appropriate futures contract typically the bond buyer has the option to receive the nominal face value or the commodity bundle in the finance literature studies of the pricing of c bonds schwartz carr priovolos do not distinguish bonds issued by foreign governments from private corporate bond issues however the literature on foreign borrowing recognizes that the distinction is crucial sovereign borrowing and default prevention

attitudes and farmer conservation behavior conservation behavior is influenced by the attitudes of farmers and by context variables like income and farm terrain important attitudes were selected by using the theory that fundamental value ranks or weights affect attitudes and that only certain values are important to the conservation decision an extension of the tobit estimation approach handling both censored observations of the dependent variable and measurement error for the nonlimit observations was used conservation behavior models can be improved with a merger of concepts and approaches from social psychology and economics

collateral free lending with risk contingent credit for agricultural development indemnifying loans against pulse crop price risk in india this article addresses the problem of collateral free lending in the context of agricultural development we investigate a viable alternative to traditional credit products through the development of risk contingent credit for operating loans and farm mortgages and apply the concept to agricultural loans for pulse crops in india risk contingent credit mitigates business and financial risk by reducing debt obligations depending on the embedded commodity options whose payoffs are linked with commodity price fluctuations we analyze daily commodity spot prices for pulse crops in india and show how risk contingent structured financial instruments can be priced in practice

approaching the environmental sustainable value in agriculture how factor endowments foster the eco efficiency abstract small and labor intensive farms guarantee a higher degree of environmental sustainability compared to rich capital intensive farms this paper offers a methodological contribution to the value based sustainability approach consisting in computing a modified indicator of environmental sustainable value using this approach the authors test how factor endowments such as capital land and labor contribute to environmental sustainable value using a long term panel of region representative european union farm accountancy data network farms in 2004 2015 the seminal within between specification was employed to control time variant and time in variant space heterogeneity of european regions the articles main finding is that higher capital endowment and lower labor intensity is beneficial for environmental sustainable value the result that farming with higher labor endowment might be less eco efficient contradicts the commonly known perception of this problem in light of our findings we conclude that the pro investment direction of the common agricultural policy should be followed but one size fit all policy is not working

creating an enabling environment policy conditions for less favored areas abstract within the rural areas those with a low productive potential usually home to poor agricultural households with limited access to assets are often the core of rural poverty and under constant threat of resource degradation there is ample evidence that neither trickle down effects in high potential areas nor structural adjustment measures have generated much poverty reduction in these less favored areas lfas often due a lack of attention to the development of factor and commodity markets sustainable and pro poor development of lfas therefore poses formidable challenges and requires special measures to achieve an enabling institutional and policy environment it needs to be based on viable sources of growth that imply considerable investments in physical and human capital and appropriate technology recognize positive externalities and add equity and natural resource management concerns in a context of heterogeneity to establish policy conditions that favor such development the role of and experience with major policy interventions incentives and institutions relevant to lfas is reviewed and an attempt is made to generalize these findings to this effect the different interventions are grouped into three broad categories viz price and market policies public services and investment and institutions and governance while countries should adopt the relevant market and trade policies the case is made for greater awareness of the adverse impact these policies can have in lfas and on their poor and complementary policies and investments need to be put in place to buffer or offset adverse outcomes key complementary interventions include public investments in infrastructure human capital and technology to enhance the competitiveness of lfas and policies to improve their market access there is also need for appropriate phasing of policy and market reforms to give people time to adjust and effective safety nets to cushion loss of livelihood options

a note on the pricing of commodity linked bonds the owner of a commodity linked bond can exchange the bond s face value for the maturity value of a commodity in an interesting application of optionpricing theory schwartz 7 provides a general framework for valuing commodity linked bonds this very general valuation framework allows for commodity price risk default risk and interest rate risk along with interest payments and dividends a partial differential equation and its associated boundary condition are derived but not solved schwartz states that the solution to the general problem is difficult even by numerical methods in order to find closed form solutions schwartz considers commodity price risk in conjunction with default risk or interest rate risk but not both this note presents a closed form solution for the value of a commodity linked bond when all three types of risk are present

assessing the trade impact of the european neighbourhood policy on the eu med free trade area the european neighbourhood policy enp set an additional objective for the southern mediterranean countries smcs the prospect of a stake in the internal market the launch of this new policy has been the occasion for a revival of empirical studies aimed at assessing the impact of the eu med partnership on bilateral trade the novelty of this work is twofold i to present nonparametric matching estimators besides gravity estimates ii to assume as a counterfactual of the treatment the ex post long run average treatment effects of the europe agreements by controlling for likely selection bias and country and time heterogeneity using both qualitative and quantitative measures of the policy variable we assess ex post the trade enhancing impact of the eu preferential agreements towards smcs and ex ante the actual efficacy of the enp

integration of environmental concerns into agricultural policies of industrial and developing countries abstract the question which this paper addresses concerns the types of environmental and resource related agricultural policy adjustments that could properly address the costs of resource degradation and increase long term prospects for sustainable development various public policy approaches e g polluter pays principle fiscal measures regulations etc are discussed and analyzed with regard to their environmental and resource impacts the paper provides illustrative experiences from industrial and developing nations and where possible lessons and insights of relevance to policy making in developing countries are sought

agricultural trade liberalization price changes and environmental effects many analyses of agricultural trade liberalization have been undertaken but few have considered the effects on the environment for the developed countries reducing the degree of protection would result in less intensive production therefore environmental stress would be reduced a reduction of trade barriers in industrial countries would result in higher world prices and in a somewhat lower world price variability assuming initially no policy changes for developing countries the question is how the liberalization would affect the environment higher prices in developing countries increase the level of production by intensifying production particularly in the commercial sector and by an area expansion both result in negative environmental effects these could be partly offset by an increase in hired labor in the commercial sector which might reduce pressure at the frontier and on marginal lands as well as by the income effect these off setting effects may be small however the direction of the overall environmental effects cannot be determined unambiguously without empirical examination at the global level the beneficial economic effects of agricultural trade liberalization probably outweigh the expected negative environmental effects in developing countries but this cannot be unambiguously established without valuation

incentives regulations and sustainable land use in costa rica deforestation in costa rica has proceeded at a rapid pace of the remaining 2 700 km2 of virgin forests on privately owned land over 300 km2 are being deforested each year pressure on national parks which cover about 27 percent of costa rica is likely to increase in the future preliminary information indicates that contrary to our expectations most of the deforestation at present is not being done by squatters but driven by profit and asset maximization motives of the timber industry banana companies and large cattle ranchers setting aside 27 percent of the country s land as parks and reserves was a major policy decision aside from the removal of some perverse incentives operating inside park areas the main issue there is one of sound management including protection from intruders strengthening enforcement and controlled tourism on the remaining primary and secondary forest areas on privately owned land outside the parks a key question is whether public interests connected with external costs of deforestation warrant public intervention the paper suggests that a differentiated approach to this and other questions is needed depending on the costs and benefits involved and it discusses incentives and regulations which influence land use and makes proposals for reforms

reconsidering agri environmental policy permitted by the uruguay round agreement agri environmental policies are increasingly being used to redress the balance between jointly produced agricultural and environmental outputs and are permitted by the uruguay round ur agreement with the general provision that they not distort trade in this paper we argue that any market consequences of efficient welfare enhancing agri environmental policies should not be considered trade distorting to consider them so is inconsistent with economic efficiency and with ecological integrity social cost benefit analysis cba is a more appropriate test and guide of trade consistency for agri environmental policies and using trade effects as the test may not enhance social welfare moreover specific provisions in the ur agreement restricting payments under agri environmental policies to opportunity costs are not warranted on economic efficiency grounds and consign the environment to a status subsidiary to agricultural output

multilateral trade negotiations european integration and farm policy reform trade negotiations and farm policy kym anderson why was it so hard to reach an agreement in the uruguay round to reduce agricultural protection after surveying the growth of agricultural protection in the 1980s i develop arguments based on political economy that imply a systematic tendency for governments to protect farmers increasingly at least up to some threshold as economic development proceeds agricultural protection growth in industrializing countries is therefore normal not exceptional liberalizing those policies before reaching that threshold is unattractive politically unless new influences e g from abroad upset the domestic political equilibrium the uruguay round provided such a force what made the early 1990s so significant a crossroads for farm policy reform was that coincidently there were other changes taking place in europe which lowered the domestic political cost of reforming the ec s common agricultural policy the paper argues that the reforms to farm policy during the rest of this decade as a result of the uruguay round agreement will at best be slow and messy but that is far preferable to the alternative of a failed uruguay round and continued growth of agricultural protection

integration of environmental concerns into economic analyses of projects and policies in an operational context abstract the efficient use of natural resources both mineral and biological as well as man made capital and human resources is a vital prerequisite for economic and social development one key role of ecological economics is to help value environmental and natural resources more precisely and internalize the cost and benefits of using such resources into the decision making process this paper reviews current economic approaches to the analysis of projects and policies and discusses possibilities for better intergrating environmental concerns into public decision making it reviews current practices as they relate to project analysis the analysis of economic policies and national income accounting a major need at present is not for more theory or techniques but for application of existing methodology and approaches to concrete problems particularly in developing countries the major objective should not be to provide fine turned numbers but to indicate orders of magnitude some project and policy alternatives can be ruled out in this fashion also one can often identify the key estimates to which the decision is sensitive and focus more refined analyses on them cost benefit analysis should be used to the extent possible alongside one needs to consider and to the extent possible rigorously analyze consequences and risks that cannot be measured in monetary terms and use for example multi criteria analysis where possible this together with sound judgement are at present the best inputs into decision making

trade liberalization economic specialization and the environment abstract a great deal has been written and a great deal of debate has raged on the effects of international trade and trade liberalization on the environment given that it is only recently that the general agreement on tariffs and trade has begun to address the interdependence of the international economy and the international environment in a systematic way it is likely that the debate will continue for quite some time it will be argued that the economic case for there being benign environmental consequences associated with trade liberalization is flawed in important ways this is due to statistical empirical and conceptual issues which affect the estimation of such effects moreover it will be argued that despite the intensity of the debate the effects of international trade on the environment have in fact only been addressed in an incidental manner rather the debate has concentrated on factors that may coexist with trade but not on the role of trade itself this has served to obscure the more fundamental environmental effects of trade liberalization through the homogenization and specialization of ecosystems

numerical evaluation of multivariate contingent claims we develop a numerical approximation method for valuing multivariate contingent claims the approach is based on an n dimensional extension of the lattice binomial method closed form solutions for the jump probabilities and the jump amplitudes are obtained the accuracy of the method is illustrated in the case of european options when there are three underlying assets article published by oxford university press on behalf of the society for financial studies in its journal the review of financial studies

agriculture in the uruguay round interests of developing countries agriculture has been favored and protected in developed countries while trade policies in developing countries frequently support industry at the expense of exportables and unprotected importables in agriculture this protection constrains expansion of temperate and subtropical agricultural exports from developing countries several studies have estimated the effects of liberalization of trade restrictions on world prices export earnings and import costs while developing countries generally would benefit from having the agricultural policies of the most powerful countries bound by international rules on trade there are differences among the developing countries as to which products should be liberalized even if such conflicts did not exist politically feasible means to obtain such compliance are elusive the potentially most feasible approaches for developing countries to obtain some measure of liberalization in the uruguay round of trade negotiations are discussed

interactions between agricultural and environmental policies a conceptual framework agricultural policy has a well documented impact on farmers production decisions and those decisions land water and agricultural chemical use may in turn affect the environment there is a public perception that existing agricultural policies are linked to agricultural pollution as exemplified by the conclusions of the recent national research council report alternative agriculture 1989 there is only limited theoretical or empirical research addressing these linkages however this paper develops a conceptual framework that can be used to analyze the interactions between agricultural and environmental policies and pollution this framework integrates physical and economic models at a disaggregate level necessary to capture the heterogeneity of the physical environment and the economic behavior of farmers following e hochman and d zilberman 1978 the disaggregate units can be statistically aggregated to a level useful for policy analysis agricultural and environmental policies can be categorized according to their effects on the intensive and extensive margins combining the different policy instruments with the microeconomic heterogeneity we find that existing agricultural and environmental policies can have either positive or negative effects of nonpoint source pollution to infer an aggregate effect requires data that do not currently exist our framework provides a basis for empirical investigations of these effects given adequate data moreover we find that agricultural policy instruments can be used to mitigate pollution if used appropriately

the long run decline in the share of agricultural and food products in international trade a gravity equation approach to its causes the objective of this study is to determine the causes of the loss of share of agricultural products and food in international trade the article compares using a gravity model the impact of various factors upon bilateral trade in agricultural products in manufactures and in total trade between 1963 and 2000 for a representative sample of 40 countries the results clearly demonstrate how the low demand elasticity for agricultural products and food the high degree of protectionism to which they were subjected and their meagre share in intra industrial trade are the principal causes of their relatively slow growth