Ng, FrancisHoekman, BernardOlarreaga, Olarreaga2014-02-252014-02-252004-05World Bank Economic Reviewhttps://hdl.handle.net/10986/17158This article assesses the impact of the world price-depressing effect of agricultural subsidies and border protection in Organization for Economic Co-operation and Development (OECD) countries on developing economies' exports, imports, and welfare. Developing economy exporters are likely to benefit from reductions in such subsidies and trade barriers, whereas net importers may lose as world prices rise. A simple partial equilibrium model of global trade in commodities that benefit from domestic support or export subsidies is developed to estimate the relevant elasticities. Simulation results suggest that a 50 percent reduction in border protection will have a much larger positive impact on developing economies' exports and welfare than a 50 percent reduction in agricultural subsidies. Although there is significant heterogeneity across developing economies, the results suggest that efforts in the Doha round of World Trade Organization (WTO) negotiations should be directed at substantially reducing border protection.en-USCC BY-NC-ND 3.0 IGOAGRICULTURAL COMMODITIESAGRICULTURAL MARKETSAGRICULTURAL PRODUCTIONAGRICULTURAL PRODUCTSAGRICULTURAL SUBSIDIESAGRICULTURAL SUPPORTAGRICULTURAL SUPPORT POLICIESAGRICULTURAL TRADEAGRICULTURAL TRADE LIBERALIZATIONAGRICULTUREAPPLIED TARIFFARBITRAGEAVERAGE EXCHANGE RATEAVERAGE TARIFFAVERAGE TARIFFSBENCHMARKBORDER PROTECTIONBUDGET CONSTRAINTSCOEFFICIENT ESTIMATECONSUMER SURPLUSCONSUMERSCORRELATION COEFFICIENTCOUNTRY DUMMYCOUNTRY DUMMY VARIABLESCURRENCY DATACUSTOMSCUSTOMS REVENUEDEMAND ELASTICITIESDEMAND ELASTICITYDEPRESSING EFFECTDEVELOPED COUNTRIESDEVELOPING COUNTRIESDISTORTIONSDOMESTIC CONSUMPTIONDOMESTIC DEMANDDOMESTIC PRODUCTIONDOMESTIC SUPPORT POLICIESECONOMETRIC ANALYSISECONOMIC POLICYELASTICITYELASTICITY OF EXPORTEQUILIBRIUMEXCHANGE RATEEXCHANGE RATE OVERVALUATIONEXOGENOUS SHOCKEXPORT REVENUEEXPORT SUBSIDIESEXPORT SUBSIDYEXPORT SUBSIDY COMMITMENTSEXPORT SUPPLYEXPORTERSEXPORTSFACTOR MARKETSFIXED COSTSFOOD INDUSTRYFREE ACCESSGDPGENERAL EQUILIBRIUMGENERAL EQUILIBRIUM MODELSGLOBAL TRADEGLOBAL TRADE ANALYSISHIGH TARIFFSHIGH-INCOME COUNTRIESIMPACT ON PRICEIMPORTIMPORT COMPETITIONIMPORT DEMANDIMPORT PRICESIMPORTSINCOMEINDUSTRIAL POLICYINTERNATIONAL ECONOMICSINTERNATIONAL FINANCIAL STATISTICSINTERNATIONAL MARKETINTERNATIONAL TRADEINTERNATIONAL TRANSPORTLDCSMARKET ACCESSMARKET STRUCTUREMOST FAVORED NATIONNATIONAL CURRENCYNATIONAL INTERESTSNET EXPORTERSOVERVALUATIONPER CAPITA INCOMEPREFERENTIAL ACCESSPREFERENTIAL TRADEPREFERENTIAL TRADE ARRANGEMENTSPRICE ELASTICITIESPRICE ELASTICITYPRICE INCREASESPRICE SUPPORTPRICE SUPPORTSPRODUCT MARKETSPROTECTION DATAPROTECTION MEASURESQUOTA TARIFFSQUOTASREDUCTION IN TARIFFSRENTSRULES OF ORIGINSPECIALIZATIONSPECIFIC COMMITMENTSSUBSIDY POLICIESSUPPLY RESPONSESUPPLY SIDETARIFF CLASSIFICATIONTARIFF EQUIVALENTTARIFF LINESTARIFF PROTECTIONTARIFF RATETARIFF RATE QUOTASTARIFF REDUCTIONTARIFF REDUCTIONSTARIFF REVENUETAXATIONTERMS OF TRADETOTAL EXPORTSTRADE BARRIERSTRADE DATATRADE LIBERALIZATIONTRADE LOSSESTRADE NEGOTIATIONSTRADE POLICYTRADE POLICY REFORMSTRADE PREFERENCESTRADE REFORMSTRADE RESTRICTIVENESSTRADE SHARESTRADING PARTNERSTRANSPORT COSTSUNILATERAL LIBERALIZATIONURUGUAY ROUNDWEIGHTSWELFARE GAINSWELFARE IMPACTSWELFARE LOSSWELFARE LOSSESWORLD DEVELOPMENT INDICATORSWORLD ECONOMYWORLD MARKETWORLD MARKETSWORLD PRICEWORLD PRICESWORLD TRADEWORLD TRADE ORGANIZATIONWORLD TRADING SYSTEMWTOJournal ArticleWorld Bank10.1596/17158