Fabiosa, Jacinto F.; Beghin, John C.; DeCara, Stephane; Elobeid, Amani; Fang, Cheng; Isik, Murat; Matthey, Holger; Saak, Alexander

Review of Agricultural Economics Vol. 27 no. 3 (September 2005): 317-335.

We investigate the impacts of multilateral removal of all border taxes and farm programs and their distortions on developing economies, using a world agriculture partial equilibrium model. We quantify changes in prices, trade flows, and production locations. Border measures and farm programs both affect world trade, but trade barriers have the largest impact. Following removal, trade expansion is substantial for most commodities, especially dairy, meats, and vegetable oils. Net agricultural and food exporters emerge with expanded exports; net importing countries with limited distortions before liberalization are penalized by higher world prices and reduced imports. We draw implications for current World Trade Organization negotiations.