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Transition Problems in Economic Reform: Agriculture in the North American Free Trade Agreement

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  • Levy, Santiago
  • van Wijnbergen, Sweder

Abstract

How fast should Mexican agriculture be incorporated into the North American Free Trade Agreement? The authors focus on the implications for policy design of the absence of efficient capital markets on the welfare costs of reforming gradually, on incentive problems created by trade adjustment policies, and on the redistributive aspects of policy reform--all transitional problems that arise in most economic reforms. A key consideration is that adjustment should focus on increasing the value of the assets owned by the groups affected and not on direct income transfers or programs targeted on characteristics controlled by the beneficiaries. Copyright 1995 by American Economic Association.

Suggested Citation

  • Levy, Santiago & van Wijnbergen, Sweder, 1995. "Transition Problems in Economic Reform: Agriculture in the North American Free Trade Agreement," American Economic Review, American Economic Association, vol. 85(4), pages 738-754, September.
    • Handle: RePEc:aea:aecrev:v:85:y:1995:i:4:p:738-54
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    Cited by:

    1. Alain de Janvry & Kyle Emerick & Marco Gonzalez-Navarro & Elisabeth Sadoulet, 2015. "Delinking Land Rights from Land Use: Certification and Migration in Mexico," American Economic Review, American Economic Association, vol. 105(10), pages 3125-3149, October.
    2. Abdullah Mamun & Will Martin & Simla Tokgoz, 2021. "Reforming Agricultural Support for Improved Environmental Outcomes," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 43(4), pages 1520-1549, December.
    3. Servaas Storm, 2003. "Transition Problems in Policy Reform: Agricultural Trade Liberalization in India," Review of Development Economics, Wiley Blackwell, vol. 7(3), pages 406-418, August.
    4. John Beghin & Sebastien Dessus & David Roland‐Hoist & Dominique van der Mensbrugghe, 1997. "The trade and environment nexus in Mexican agriculture. A general equilibrium analysis," Agricultural Economics, International Association of Agricultural Economists, vol. 17(2-3), pages 115-131, December.
    5. Beetsma, Roel M.W.J. & Debrun, Xavier, 2007. "The new stability and growth pact: A first assessment," European Economic Review, Elsevier, vol. 51(2), pages 453-477, February.
    6. Georges, Patrick & Mérette, Marcel, 2011. "Trade Diversification Away from the U.S. or North American Customs Union? A Review of Canada’s Trade Policy Options," Conference papers 332084, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    7. Anderson, James E., 1997. "Revenue Neutral Trade Reform with Many Households, Quotas and Tariffs," Seminar Papers 626, Stockholm University, Institute for International Economic Studies.
    8. Bougheas, Spiros & Nelson, Doug, 2013. "On the political economy of high skilled migration and international trade," European Economic Review, Elsevier, vol. 63(C), pages 206-224.
    9. James Boyce, "undated". "The Globalization of Market Failure? International Trade and Sustainable Agriculture," Published Studies ps3, Political Economy Research Institute, University of Massachusetts at Amherst.
    10. Gabriel Gonzalez-Konig & Quentin Wodon, 2005. "Do Cash Transfers to Farmers Reduce Migration? Procampo in Mexico," Department of Economics and Finance Working Papers EC200501, Universidad de Guanajuato, Department of Economics and Finance, revised Aug 2005.
    11. James E. Anderson, 2002. "Trade Reform Diagnostics with Many Households, Quotas, and Tariffs," Review of International Economics, Wiley Blackwell, vol. 10(2), pages 215-236, May.
    12. Chiquiar, Daniel, 2008. "Globalization, regional wage differentials and the Stolper-Samuelson Theorem: Evidence from Mexico," Journal of International Economics, Elsevier, vol. 74(1), pages 70-93, January.
    13. Nag, Biswajit & Sikdar, Chandrima, 2011. "India-ASEAN FTA: Implication of Phased Liberalisation," Conference papers 332153, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    14. Salvator Nkunzimana & H. Alan Love & C. Richard Shumway, 2003. "Mexican agricultural trade under the GATT," Applied Economics, Taylor & Francis Journals, vol. 35(4), pages 449-459.
    15. Jesper Jensen & David Tarr, 2014. "Deep Trade Policy Options for Armenia: The Importance of Trade Facilitation, Services and Standards Liberalization," World Scientific Book Chapters, in: APPLIED TRADE POLICY MODELING IN 16 COUNTRIES Insights and Impacts from World Bank CGE Based Projects, chapter 19, pages 453-508, World Scientific Publishing Co. Pte. Ltd..
    16. Roberto A. De Santis, 2001. "The 1990 Trade Liberalisation Policy of Turkey: An Applied General Equilibrium Assessment," International Economic Journal, Taylor & Francis Journals, vol. 15(2), pages 115-132, June.
    17. Féménia, Fabienne & Gohin, Alexandre, 2013. "On the optimal implementation of agricultural policy reforms," Journal of Policy Modeling, Elsevier, vol. 35(1), pages 61-74.
    18. Weiss, Eli & Rosenblatt, David, 2010. "Regional economic growth in Mexico : recent evolution and the role of governance," Policy Research Working Paper Series 5369, The World Bank.
    19. Chiquiar, Daniel, 2005. "Why Mexico's regional income convergence broke down," Journal of Development Economics, Elsevier, vol. 77(1), pages 257-275, June.
    20. Robert Shelburne, 2006. "A Utilitarian Welfare Analysis of Trade Liberalization," ECE Discussion Papers Series 2006_4, UNECE.
    21. Guillermo E. Perry & Omar S. Arias & J. Humberto López & William F. Maloney & Luis Servén, 2006. "Poverty Reduction and Growth : Virtuous and Vicious Circles," World Bank Publications - Books, The World Bank Group, number 6997.
    22. Jensen, Jesper & Tarr, David G., 2010. "Regional trade policy options for Tanzania : the importance of services commitments," Policy Research Working Paper Series 5481, The World Bank.
    23. James Boyce, 1996. "Ecological Distribution, Agricultural Trade Liberalization, and In Situ Genetic Diversity," Published Studies ps14, Political Economy Research Institute, University of Massachusetts at Amherst.

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