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Illicit Agricultural Trade

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  • Ferrier, Peyton

Abstract

Agricultural and wildlife trade is subject to sudden, disruptive import restrictions arising from concerns over sanitary and phytosanitary safety and the conservation of natural resources. These restrictions can create significant international price differences that encourage the smuggling of goods across borders. This article presents an equilibrium model of smuggling where the supply and demand for smuggled goods depend on interregional price disparities in the presence of a trade ban. In this model, smuggling is more prevalent when demand and supply among trade partners is more inelastic or when there are fewer total trade partners at the time a trade ban is enacted. Applications are presented for regionalization, destruction of goods in government eradication programs, price support, stockpiling, and the development of substitutes. Regionalization may increase smuggling under certain production and consumption patterns.

Suggested Citation

  • Ferrier, Peyton, 2008. "Illicit Agricultural Trade," Agricultural and Resource Economics Review, Cambridge University Press, vol. 37(2), pages 273-287, October.
    • Handle: RePEc:cup:agrerw:v:37:y:2008:i:02:p:273-287_00
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    Citations

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    Cited by:

    1. Moyle, Brendan, 2014. "The raw and the carved: Shipping costs and ivory smuggling," Ecological Economics, Elsevier, vol. 107(C), pages 259-265.
    2. Ferrier, Peyton, 2010. "Irradiation as a quarantine treatment," Food Policy, Elsevier, vol. 35(6), pages 548-555, December.
    3. Peyton Michael Ferrier, 2021. "Detecting origin fraud with trade data: the case of U.S. honey imports," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 65(1), pages 222-245, January.
    4. Gilberto Gonz'alez-Parra & Benito Chen-Charpentier & Abraham J. Arenas & Miguel Diaz-Rodriguez, 2015. "Mathematical modeling of physical capital using the spatial Solow model," Papers 1504.04388, arXiv.org.
    5. Gilberto González-Parra & Benito Chen-Charpentier & Abraham J. Arenas & Miguel Díaz-Rodríguez, 2022. "Mathematical Modeling of Physical Capital Diffusion Using a Spatial Solow Model: Application to Smuggling in Venezuela," Economies, MDPI, vol. 10(7), pages 1-16, July.
    6. Pavleska, Marija & Kerr, William A., 2020. "Importer's risk, smuggling and the role of incentives in the management of animal diseases," Ecological Economics, Elsevier, vol. 175(C).
    7. Ferrier, Peyton Michael, 2020. "Detecting origin fraud with trade data: the case of U.S. honey imports," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 65(01), January.
    8. Ferrier, Peyton Michael, 2009. "The Economics of Agricultural and Wildlife Smuggling," Economic Research Report 55951, United States Department of Agriculture, Economic Research Service.

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