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Export Subsidies And Profit-Shifting In Vertical Markets

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  • Sheldon, Ian M.
  • Pick, Daniel H.
  • McCorriston, Steve

Abstract

This study examines the interaction between export subsidies and profit-shifting in a vertical production system consisting of agricultural commodity production, and intermediate and final good processing, where the latter two stages may be characterized by imperfect competition. Using a model with general functional forms for demand, comparative statics indicate that an export subsidy to an unprocessed agricultural commodity, under certain circumstances, can have greater profit-shifting effects at the final processing stage compared to an export subsidy targeted at the final processed good.

Suggested Citation

  • Sheldon, Ian M. & Pick, Daniel H. & McCorriston, Steve, 2001. "Export Subsidies And Profit-Shifting In Vertical Markets," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 26(01), pages 1-17, July.
    • Handle: RePEc:ags:jlaare:31151
    DOI: 10.22004/ag.econ.31151
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    Cited by:

    1. Ian M. Sheldon, 2021. "Reflections on a Career as an Industrial Organization and International Economist," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 43(2), pages 468-499, June.
    2. Pavel Ciaian & d’Artis Kancs & Johan Swinnen, 2010. "EU Land Markets and the Common Agricultural Policy," Journal of Economics and Econometrics, Economics and Econometrics Society, vol. 53(3), pages 1-31.
    3. Jerzy Michalek & Pavel Ciaian & d’Artis Kancs, 2014. "Capitalization of the Single Payment Scheme into Land Value: Generalized Propensity Score Evidence from the European Union," Land Economics, University of Wisconsin Press, vol. 90(2), pages 260-289.
    4. Pavel Ciaian & D'Artis Kancs & Johan Swinnen, 2014. "The Impact of the 2013 Reform of the Common Agricultural Policy on Land Capitalization in the European Union," Applied Economic Perspectives and Policy, Agricultural and Applied Economics Association, vol. 36(4), pages 643-673.
    5. Pavel Ciaian & d'Artis Kancs & Maria Espinosa, 2018. "The Impact of the 2013 CAP Reform on the Decoupled Payments’ Capitalisation into Land Values," Journal of Agricultural Economics, Wiley Blackwell, vol. 69(2), pages 306-337, June.
    6. Svetlana Ledyayeva, 2017. "Export incentives and global value chains," UCL SSEES Economics and Business working paper series 2017-2, UCL School of Slavonic and East European Studies (SSEES).
    7. Pavel Ciaian & d'Artis Kancs & Jo Swinnen, 2008. "Static and Dynamic Distributional Effects of Decoupled Payments," Journal of Economics and Econometrics, Economics and Econometrics Society, vol. 51(2), pages 20-47.
    8. Reimer, Jeffrey J. & Stiegert, Kyle W., 2006. "Evidence on Imperfect Competition and Strategic Trade Theory," Staff Paper Series 498, University of Wisconsin, Agricultural and Applied Economics.
    9. Baldoni, Edoardo & Ciaian, Pavel, 2023. "The capitalization of CAP subsidies into land prices in the EU," Land Use Policy, Elsevier, vol. 134(C).

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