NORTH AMERICAN AGRICULTURAL TRADE DURING 1975-98: A BACKGROUND PAPER ON TRADE FLOWS

International Relations/Trade,

A Globally Consistent Framework for Reliability-based Trade Statistics Reconciliation in the Presence of an Entrepôt

This paper develops a mathematicla programming model to reconcile trade statistics subject to a set of global consistency conditions in the presence of an entrepot. Initial data reliability serves a key function for governing the magnitude of adjustment. Through a two-stage optimization procedure, the adjusted trade statistics are achived as solutions to a system of simultaneous equations that minimize a quadratic penalty function. As an empirical illustration, the model is applied to reconcile the 2004 trade statistics reported by China, Hong Kong, and their major trading partners, initialized with detailed estimates of bilateral trade flows, re-export markups, cif/fob ratios and data reliability indexes.trade statistics reconciliation, entrepot trade, data reliability, global consistency

Effects of Increased Biofuels on the U.S. Economy in 2022

Achieving greater energy security by reducing dependence on foreign petroleum is a goal of U.S. energy policy. The Energy Independence and Security Act of 2007 (EISA) calls for a Renewable Fuel Standard (RFS-2), which mandates that the United States increase the volume of biofuel that is blended into transportation fuel from 9 billion gallons in 2008 to 36 billion gallons by 2022. Long-term technological advances are needed to meet this mandate. This report examines how meeting the RFS-2 would affect various key components of the U.S. economy. If biofuel production advances with cost-reducing technology and petroleum prices continue to rise as projected, the RFS-2 could provide economywide benefits. However, the actual level of benefits (or costs) to the U.S. economy depends importantly on future oil prices and whether tax credits are retained in 2022. If oil prices stabilize or decline from current levels and tax credits are retained, then benefits to the economy would diminish.Bioenergy, economywide, ethanol, petroleum, trade, macroeconomic factors, RFS-2, Resource /Energy Economics and Policy,

Managing Firm Competitiveness in Global Markets

The globalization profile of US food firms is mixed. US sales from foreign direct investment is now over six times the level of exports, while US processed food trade balance has moved from +$9 billion in 1995 to -$7 billion in 2004. Competitive forces drive firms to seek new areas of growth, with either portfolio expansion or penetration and expansion in new markets. Although the forces that weigh heavily on a firm are recognized, their influence in determining a firm’s action in choosing a particular strategy is not well understood. As the nature of food manufacturing is evolving and the operational scope of a food manufacturing firm has grown from local, to regional, national, and global, is there a new role for policy? What we do know is that a firm trades with other firms and that aggregate trade patterns do not fully reflect how firms view prospects, make decisions and factor in policies as they organize themselves for trade. Addressing the potential characterizations of competitiveness for the industry and the firm followed by the conflicting influences of R&D on competitiveness, we focus on what is meant by a global food firm with the use of the experiences of three industry case studies.Competitiveness, Food Manufacturing, Globalization, Case study

Bilateral Protection and Other Determinants of Trade: A Gravity Model Approach

Replaced with revised version of paper 10/03/07.International Relations/Trade,

Global Growth, Macroeconomic Change, and U.S. Agricultural Trade

After a decade of uneven export growth and rapidly growing imports, U.S. agriculture has begun to reassert its position in global trade markets. Rising exports and signs of moderating demand for imports mark a departure from previous trends. This report places past trends and emerging developments in perspective by spotlighting the role of two specific factors that help steer U.S. agricultural trade patterns: global growth and shifts in foreign economic activity that affect U.S. exports, and macroeconomic factors underlying the growth of U.S. imports. Consistent with actual changes in the level and destination of U.S. exports, model simulations corroborate the contention that renewed export growth can be sustained by expanding incomes and growing food import demand in emerging economies. In contrast, the rapid growth of U.S. agricultural imports appears less related to domestic income growth than to changing consumer preferences and other, perhaps less sustainable, macroeconomic conditions that fostered the growth of U.S. current account deficits.agricultural trade, trade balance, income growth, economic development, population, macroeconomics, exchange rates, current account, growth projections., Agricultural and Food Policy, Agricultural Finance, International Development, International Relations/Trade,

Developing Country Trade: Implications of China’s Changing Trade and Competitiveness in Intensive and Extensive Margin Goods

This paper delves into China’s differential growths in trade flows with high income and developing countries by focusing on bilateral content of trade data over the time period 1978-2005. Unlike other studies, we account for end use of traded goods ranging from primary, intermediate, and finished goods because China’s policies impact all segments China’s trade flows. In the last 28 years, China has specialized in deficits in the upstream production segments (parts and components) and rapid diversification in consumption goods (extensive margin). While in the late 1970s China’s export and import growth on all goods with major high income countries is outstanding in the most recent years China’s trade growth with developing countries has taken the lead while China is gaining in extensive margins goods trade. This general pattern evolving is in agreement with some of the new trade theory that gives a dominant role to an expansion of the number of export varieties (the extensive margin), which provides an additional channel for welfare gains from trade.China, international trade, growth, intensive, extensive margins, developing countries, International Relations/Trade,

Forces behind China's Surging Trade: Competitiveness or Policy Driven?

This paper delves into China's differential growths in trade flows with high income countries by focusing on bilateral content of trade data over the time period 1962-2005. Unlike other studies, we account for end use of traded goods ranging from primary, intermediate, and finished goods because China's policies impact all segments China's trade flows. China's trade growth patterns with major high income countries clearly indicate that the adjacency-neighborhood partners alone is unlikely to explain its unprecedented growth in exports and imports. China's outstanding performance in trade growth can be traced back to the 1970s with changes in its policies and increased involvement in the international segmentation of production processes and preferential tariff treatment to assembling and processing activities.China, international trade, growth, policies, International Relations/Trade,

MARKET ACCESS FOR HIGH-VALUE FOODS

Market access remains a major impediment for expansion of global trade in high-value foods, particularly processed foods. Countries use tariffs and other measures that effectively stimulate imports of relatively unprocessed agricultural commodities at the expense of processed products. Tariff escalation, in which tariffs rise with the level of processing, discourages trade in high-value foods, and trade remedy measures, such as antidumping duties, are concentrated among high-value products. Globalization has provided countries with easier access to capital and technology needed to produce processed food, further affecting trade patterns and markets for high-value foods. A uniform cut in tariffs increases trade in high-value foods more than trade in raw agricultural commodities and improves real wages in developing and developed countries.Food trade, processed food, high-value foods, tariff, tariff escalation, trade remedy measures, sanitary and phytosanitary measures, safeguard measures, revealed comparative advantage, trade complementarities, International Relations/Trade,

AGRICULTURAL POLICY REFORM IN THE WTO: THE ROAD AHEAD

Agricultural trade barriers and producer subsidies inflict real costs, both on the countries that use these policies and on their trade partners. Trade barriers lower demand for trade partners' products, domestic subsidies can induce an oversupply of agricultural products which depresses world prices, and export subsidies create increased competition for producers in other countries. Eliminating global agricultural policy distortions would result in an annual world welfare gain of $56 billion. High protection for agricultural commodities in the form of tariffs continues to be the major factor restricting world trade. In 2000, World Trade Organization (WTO) members continued global negotiations on agricultural policy reform. To help policymakers and others realize what is at stake in the global agricultural negotiations, this report quantifies the costs of global agricultural distortions and the potential benefits of their full elimination. It also analyzes the effects on U.S. and world agriculture if only partial reform is achieved in liberalizing tariffs, tariff-rate quotas (limits on imported goods), domestic support, and export subsidies.Agricultural and Food Policy, International Relations/Trade,