Preferential trade agreements between the monetary community of Central Africa and the European Union: Stumbling or building blocks? A general equilibrium approach

"This paper uses a computable general equilibrium approach to simulate two opposing views describing regional trade agreements either as building blocks for or stumbling blocks to multilateral trade liberalization. This study focuses on the free trade agreement (FTA) between the Economic and Monetary Community of Central Africa (CEMAC) and the European Union (EU). Results show that although a regional trade agreement may slightly raise welfare among the members of the agreement, the cost to nonmembers can be high. In this paper we argue that multilateral liberalization and a regional free trade agreement between the EU and CEMAC are not mutually exclusive. Regional trade agreements should be complementary and consistent with a multilateral agreement, not an attempt to replace it. The regional breakdown in our design considers 14 regions, allowing for country-specific analysis for one least-developed country (Democratic Republic of Congo) and one non-least-developed country (Cameroon). Multilateral liberalization amplifies welfare gain for Cameroon. The Democratic Republic of Congo, with its weaker institutional capacity, is affected negatively. An EU-CEMAC FTA without multilateralism produces gains for both Cameroon and the Democratic Republic of Congo. The gain for Cameroon is, however, moderate compared with that achieved when the EU-CEMAC FTA is accompanied with a multilateral agreement." from authors' abstractRegional trade, multilateral trade, Computable General Equilibrium Models, European Union, Development strategies,

European Union preferential trade agreements with developing countries and their impact on Colombian and Kenyan carnation exports to the United Kingdom:

"United Kingdom (UK) demand for carnations by exporting country was estimated using a production version of the Rotterdam model, and model estimates were used to assess the effects of EU preferential trade agreements on import demand. Of particular importance was how these agreements affected Colombian and Kenyan carnation exports to the UK, the second largest market for Colombian carnations and the largest market for Kenyan carnations. Results showed that Colombia benefited from preferential access to the UK more so than Kenya: the benefit to Colombia was due to both trade creation and diversion, whereas the benefit to Kenya was mostly due to trade diversion. Results further showed that the competition between Colombian and Kenyan carnations was insignificant, and there was no evidence that the preferences given to Colombia harmed Kenya or vice versa." from authors' abstractCarnations, Preferential trade agreements, Trade diversion, Development strategies,

Cropping practices and labor requirements in field operations for major crops in Ghana: What needs to be mechanized?

This study is to examine the labor requirements associated with different cropping systems in Ghana in order to guide the prioritization of investments in mechanization in the country. First, major cropping systems are identified in the country by adopting the cropping pattern approach of Ruthenberg (1983), who defined farming systems according to the leading crop activities. Second, labor requirements and costs of production of crops in the various systems are examined at various levels of substitution of either herbicides or animal and mechanical traction for labor. We found that the total labor requirements varied among cropping systems. The requirements were particularly high in the two cocoa cropping systems in the forest zones. The requirements were particularly high for land preparation and crop maintenance. Looking across crops, land preparation and crop maintenance took the largest share of labor for cassava, yam, and maize. Rice, on the other hand, required large shares of labor for land preparation and harvesting. When all the systems are considered together, however, crop maintenance required more labor than land preparation. In response to apparent unavailability and cost of labor, farmers are increasingly demanding mechanical traction for land preparation in Ghana. The benefits of mechanizing land preparation depend on both the system and the type of crop cultivated. Mechanization of land preparation for cassava in the vegetable belt, for instance, is more labor saving and cost effective than m Mechanization of land preparation for cassava in cereals belt. Within systems, there is also variation across crops. Where mechanization is not feasible for land preparation or not yet adopted for other field operations such as weeding, an alternative and common substitution for labor in crop production is herbicides. Herbicides are used to clear land for planting as well as to control weeds in standing crops. We found that where herbicide was used, its application reduced labor requirements for land preparation significantly. Selective herbicides were used to control weeds in all the crops examined and in all the belts except the vegetable belt. They also reduced labor use for weeding drastically.Cropping systems, labor requirements, mechanization, seasonal labor, Development strategies,

GEOGRAPHIC AND INSTITUTIONAL DETERMINANTS OF REAL INCOME:A SPATIO-TEMPORAL SIMULTANEOUS EQUATION APPROACH

This paper tests a series of prominent hypotheses regarding the determinants of per-capita income using a novel spatial econometric approach to control for spillovers among neighboring countries and for spatially correlated omitted variables. We use simultaneous equations to identify alternative channels through which country characteristics might affect income, and then test the robustness of those effects. We find support for both “institutionalist” and “geographic” determinants of income. A time-varying index of institutional quality has a strong independent effect on current income, but there is also a persistent effect of geographic factors such as seasonal frost, malaria transmission, and coastal location, which influence income through their links to agricultural output, health, urbanization and trade. The data cover 95 countries across the world from 1960 through 2002, which we use to construct a pooled dataset of nine 5-year averages centered on 1960, 1965, and so on through 2000. We use both limited and full information estimators, partly based on a generalized moments (GM) estimator for spatial autoregressive coefficients, allowing for spatial error correlation, correlation across equations, and the presence of spatially lagged dependent variableseconomic growth, geography, institutions, spatial econometrics, simultaneous equations

A spatial-simultaneous equation approach

This paper tests a series of prominent hypotheses regarding how institutions, geography, and trade interact to influence income per capita using a novel spatial econometric approach to control for both spillovers among neighboring countries and spatially correlated omitted variables. Simultaneous equations are used to identify alternative channels through which country characteristics might affect income through trade and institutions, and then to test the robustness of those effects. Evidence indicated that both institutions and trade influence growth. Geographical factors such as whether a country is landlocked and its distance to the equator influence income, but only through trade. Data covering 95 countries across the world from 1960 through 2002 was used to construct a pooled dataset of 5-year averages (9 in all) centered on 1960, 1965, and so on through 2000. Both limited and full information estimators, partly based on a generalized moments (GM) estimator for spatial autoregressive coefficients, were used. These allow for spatial error correlation, correlation across equations, and the presence of spatially lagged dependent variables.Non-PRIFPRI1; GRP32DSG

Stumbling or building blocks? A general equilibrium approach

"This paper uses a computable general equilibrium approach to simulate two opposing views describing regional trade agreements either as building blocks for or stumbling blocks to multilateral trade liberalization. This study focuses on the free trade agreement (FTA) between the Economic and Monetary Community of Central Africa (CEMAC) and the European Union (EU). Results show that although a regional trade agreement may slightly raise welfare among the members of the agreement, the cost to nonmembers can be high. In this paper we argue that multilateral liberalization and a regional free trade agreement between the EU and CEMAC are not mutually exclusive. Regional trade agreements should be complementary and consistent with a multilateral agreement, not an attempt to replace it. The regional breakdown in our design considers 14 regions, allowing for country-specific analysis for one least-developed country (Democratic Republic of Congo) and one non-least-developed country (Cameroon). Multilateral liberalization amplifies welfare gain for Cameroon. The Democratic Republic of Congo, with its weaker institutional capacity, is affected negatively. An EU-CEMAC FTA without multilateralism produces gains for both Cameroon and the Democratic Republic of Congo. The gain for Cameroon is, however, moderate compared with that achieved when the EU-CEMAC FTA is accompanied with a multilateral agreement." --from authors' abstractNon-PRIFPRI1; GRP32DSG

Stumbling or building blocks? A general equilibrium approach

PRISI; IFPRI3DSG

Overcoming neighborhood effects in Africa

PRIFPRI3DSG

Preferential Trade Agreements between the Monetary Community of Central Africa and the European Union

This paper uses a computable general equilibrium approach to simulate two opposing views describing regional trade agreements either as building blocks for or stumbling blocks to multilateral trade liberalization. This study focuses on the free trade agreement (FTA) between the Economic and Monetary Community of Central Africa (CEMAC) and the European Union (EU). Results show that although a regional trade agreement may slightly raise welfare among the members of the agreement, the cost to nonmembers can be high. In this paper we argue that multilateral liberalization and a regional free trade agreement between the EU and CEMAC are not mutually exclusive. Regional trade agreements should be complementary and consistent with a multilateral agreement, not an attempt to replace it. The regional breakdown in our design considers 14 regions, allowing for country-specific analysis for one leastdeveloped country (Democratic Republic of Congo) and one non-least-developed country (Cameroon). Multilateral liberalization amplifies welfare gain for Cameroon. The Democratic Republic of Congo, with its weaker institutional capacity, is affected negatively. An EU-CEMAC FTA without multilateralism produces gains for both Cameroon and the Democratic Republic of Congo. The gain for Cameroon is, however, moderate compared with that achieved when the EU-CEMAC FTA is accompanied with a multilateral agreement