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Maize and the Free Trade Agreement between Mexico and the United States

Author

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  • Levy, Santiago
  • van Wijnbergen, Sweder

Abstract

Setting the price of maize in rural Mexico above the world price is inefficient and likely to have negative distributional effects because many subsistence producers, and all landless workers, are net buyers; in fact it screens out the relatively poor rather than the relatively rich. The policy objective, therefore, should be to move toward free trade. This would yield large gains in efficiency. The Free Trade Agreement provides an ideal opportunity to pursue this objective. It will provide freer entrance into the United States for other agricultural products as well as a broad range of manufactured products. Insuring secure and sustained access for labor-intensive agricultural and manufactured products can help ease the impact on the labor market of a transition away from subsistence maize cultivation. Copyright 1992 by Oxford University Press.

Suggested Citation

  • Levy, Santiago & van Wijnbergen, Sweder, 1992. "Maize and the Free Trade Agreement between Mexico and the United States," The World Bank Economic Review, World Bank, vol. 6(3), pages 481-502, September.
    • Handle: RePEc:oup:wbecrv:v:6:y:1992:i:3:p:481-502
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    Citations

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    Cited by:

    1. World Bank, 2004. "Mexico : Public Expenditure Review, Volume 2. Main Report," World Bank Publications - Reports 15660, The World Bank Group.
    2. Avalos-Sartorio, Beatriz, 2006. "What can we learn from past price stabilization policies and market reform in Mexico?," Food Policy, Elsevier, vol. 31(4), pages 313-327, August.
    3. Felicia Wu & Hasan Guclu, 2013. "Global Maize Trade and Food Security: Implications from a Social Network Model," Risk Analysis, John Wiley & Sons, vol. 33(12), pages 2168-2178, December.
    4. Blake, Adam & Gomez-Plana, Antonio Gomez & Latorre Munoz, María C., 2005. "Macroeconomic effects of foreign direct investment in the Spanish economy," Conference papers 331357, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    5. Barbier, Edward B., 2004. "Agricultural Expansion, Resource Booms and Growth in Latin America: Implications for Long-run Economic Development," World Development, Elsevier, vol. 32(1), pages 137-157, January.
    6. Larson, Donald F., 1993. "Policies for coping with price uncertainty for Mexican maize : policies for maize price variability in Mexico," Policy Research Working Paper Series 1120, The World Bank.
    7. de Janvry, Alain & Sadoulet, Elisabeth & de Anda, Gustavo Gordillo, 1995. "NAFTA and Mexico's maize producers," World Development, Elsevier, vol. 23(8), pages 1349-1362, August.
    8. Greenwood, Michael J. & Hunt, Gary L. & Kohli, Ulrich, 1997. "The factor-market consequences of unskilled immigration to the United States," Labour Economics, Elsevier, vol. 4(1), pages 1-28, March.
    9. U Pascual & R Martinez-Espineira, 2003. "Integrated Policy Options for Land Conservation and Rural Poverty Alleviation: A System-Dynamics Approach," Economics Discussion Paper Series 0323, Economics, The University of Manchester.
    10. J. C. Burgess, 1998. "Economic analysis of deforestation in Mexico," Chapters, in: The Economics of Environment and Development, chapter 10, pages 183-222, Edward Elgar Publishing.
    11. Smale, Melinda & Bellon, Mauricio R. & Gomez, Jose Alfonso Aguirre, 1999. "The Private and Public Characteristics of Maize Land Races and the Area Allocation Decisions of Farmers in a Center of Crop Diversity," Economics Working Papers 7669, CIMMYT: International Maize and Wheat Improvement Center.
    12. Elena Ianchovichina & Alessandro Nicita & Isidro Soloaga, 2002. "Trade Reform and Poverty: The Case of Mexico," The World Economy, Wiley Blackwell, vol. 25(7), pages 945-972, July.
    13. K. Doroodian & Roy Boyd, 1999. "The impact of removing corn subsidies in mexico: A general equilibrium assessment," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 27(2), pages 150-169, June.
    14. Bellon, Mauricio R. & Hellin, Jon, 2011. "Planting Hybrids, Keeping Landraces: Agricultural Modernization and Tradition Among Small-Scale Maize Farmers in Chiapas, Mexico," World Development, Elsevier, vol. 39(8), pages 1434-1443, August.
    15. de Janvry, Alain & Sadoulet, Elisabeth & de Anda, Gustavo, 1994. "NAFTA and Mexico's Corn Producers," CUDARE Working Papers 201471, University of California, Berkeley, Department of Agricultural and Resource Economics.
    16. Barbier, Edward B., 2000. "Links between economic liberalization and rural resource degradation in the developing regions," Agricultural Economics, Blackwell, vol. 23(3), pages 299-310, September.
    17. Alder Keleman, 2010. "Institutional support and in situ conservation in Mexico: biases against small-scale maize farmers in post-NAFTA agricultural policy," Agriculture and Human Values, Springer;The Agriculture, Food, & Human Values Society (AFHVS), vol. 27(1), pages 13-28, March.
    18. Petit, Michel & Gnaegy, Suzanne, 1995. "Agricultural Competitiveness and Global Trade: Looking at the Future of Agriculture Through a Crystal Ball," 1994 Conference, August 22-29, 1994, Harare, Zimbabwe 183374, International Association of Agricultural Economists.

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