The Cairns Group Perspective

Abstract

Although there are few countries which leave incentives in their farm sectors undistorted, there are many in which the economy-wide pattern of protection does not favour agriculture as a whole. Convention in the theory of trade protection (Anderson and Hayami, 1986; Vousden, 1990) would lead us to expect that most agricultural exporting countries would be members of this latter group. The principal modern exceptions, of course, are the EC and the United States, both of which now protect exporting agricultural sectors. These exceptions aside, the predominant agricultural exporting countries are indeed among those whose patterns of protection do not assist agriculture.

Thanks are due to Don Gunasekera, Richard Higgott and T.K. Warley for useful discussions on the subject of the paper, and to Prue Phillips for access to the resources of the ANU International Economic Databank. The introductory parts of the chapter draw on Tyers (1992b), though the analysis presented here is more extensive and the results differ as a consequence of the use of a recently up-dated and extended version of the Tyers-Anderson model, combined with more recent estimates of incentive distortions in agriculture. Constructive suggestions from the editors are appreciated.