Agricultural trade distortions during the global financial crisis

Kym Anderson, Signe Nelgen

    Research output: Contribution to journalArticle

    Abstract

    Import barriers are often raised during turbulent times, as governments worry about immediate domestic concerns such as unemployment. The recent global financial crisis, however, was accompanied by an exogenous upward spike in the international price of food, which led some countries to raise export barriers, thereby exacerbating both the price spike and the international welfare transfer associated with that change in the terms of trade. As in previous price-spike periods, that response by some food-exporting countries was accompanied by a lowering of import restrictions by numerous food-importing countries, further exacerbating the international price spike. This paper provides new evidence up to 2010 on the extent of the change in domestic relative to international prices in both groups of countries, and compares it with responses during two previous food price-spike periods. It concludes that there is a need for stronger World Trade Organization disciplines on export as well as import restrictions, so as to limit the extent to which beggar-thy-neighbour government responses to international price spikes (up or down) exacerbate those shocks.
    Original languageEnglish
    Pages (from-to)235-260
    JournalOxford Review of Economic Policy
    Volume28
    Issue number2
    DOIs
    Publication statusPublished - 2012

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