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Dairy disaggregation and joint production in an economy-wide model

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  • Charteris, Angus
  • Winchester, Niven

Abstract

We examine the impact of dairy disaggregation and joint production on trade liberalisation outcomes in an economy-wide model. Depending on parameterisation, our model includes either (i) a single dairy commodity, (ii) several dairy commodities without joint production or (iii) several dairy commodities with joint production. In a numerical application, we consider the removal of US tariffs on dairy exports from New Zealand (the world’s largest dairy exporter). We show that failing to account for joint production when dairy commodities are disaggregated leads to misleading results. Our preferred dairy production function differs from those used in other applied trade models. Our analysis can be used to determine when accounting for joint production in other sectors is important.

Suggested Citation

  • Charteris, Angus & Winchester, Niven, 2010. "Dairy disaggregation and joint production in an economy-wide model," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 54(4), pages 1-17.
    • Handle: RePEc:ags:aareaj:162025
    DOI: 10.22004/ag.econ.162025
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    Cited by:

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    2. Zhang, Xiaohan & Winchester, Niven & Zhang, Xiliang, 2017. "The future of coal in China," Energy Policy, Elsevier, vol. 110(C), pages 644-652.
    3. John Beghin & Caesar Cororaton & Federica Demaria & Sophie Drogue & Marie-Hélène Felt & Jean-Philippe Gervais & Graciela Ghezan & Thomas Heckelei & Jikun Huang & Daniel Iglesias & Daniel Lema & Natali, 2010. "Guidelines and methodology to analyze the different case studies," Working Papers hal-02818030, HAL.
    4. Brockmeier, Martina & Bektasoglu, Beyhan, 2014. "Model structure or data aggregation level: Which leads to greater bias of results?," Economic Modelling, Elsevier, vol. 38(C), pages 238-245.
    5. Beyhan Bektasoglu & Tanja Engelbert & Martina Brockmeier, 2017. "The Effect of Aggregation Bias: An NTB-modelling Analysis of Turkey's Agro-food Trade with the EU," The World Economy, Wiley Blackwell, vol. 40(10), pages 2255-2276, October.

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    More about this item

    Keywords

    International Relations/Trade; Production Economics;

    JEL classification:

    • D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
    • F15 - International Economics - - Trade - - - Economic Integration

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