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Potential Impacts of an Exclusionary Trans-Pacific Partnership Agreement on Agriculture in the US and Japan

Author

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  • Jada M. Thompson

    (Jada M. Thompson is a graduate student at the Department of Agricultural and Resource Economics, Colorado State University, 1172 Campus Delivery, Fort Collins, CO 80523-1172, US, email: Jada.Thompson@colostate.edu)

  • Amanda M. Leister

    (Amanda M. Leister is Assistant Professor at the Department of Agricultural and Resource Economics, Colorado State University, 1172 Campus Delivery, Fort Collins, CO 80523-1172, US, email: amanda.leister@colostate.edu)

Abstract

The Trans-Pacific Partnership (TPP) is a free trade agreement that hopes to eliminate all tariff and non-tariff trade barriers between 12 participating countries. Japan, the fourth-largest trading partner for the United States, is a significant player in the negotiations. Due to cultural and historical significance it is expected that Japan will ask for exclusions on agricultural products, limiting the overall effectiveness of a fully liberalised agreement. Using a computable general equilibrium modelling framework across varying scenarios, we show the difference between the full liberalisation and potential exclusionary scenarios. Estimates show that a 25 per cent reduction in import tariffs on agricultural commodities in Japan results in a difference of net welfare benefits equal to –USD 7 billion, emphasising the importance of these concessions. JEL Classification: F14, F15, Q17

Suggested Citation

  • Jada M. Thompson & Amanda M. Leister, 2015. "Potential Impacts of an Exclusionary Trans-Pacific Partnership Agreement on Agriculture in the US and Japan," Margin: The Journal of Applied Economic Research, National Council of Applied Economic Research, vol. 9(4), pages 362-378, November.
    • Handle: RePEc:sae:mareco:v:9:y:2015:i:4:p:362-378
    DOI: 10.1177/0973801015596855
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    References listed on IDEAS

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    1. Peter A. Petri & Michael Plummer, 2012. "The Trans-Pacific Partnership and Asia-Pacific Integration: Policy Implications," Policy Briefs PB12-16, Peterson Institute for International Economics.
    2. Hertel, Thomas, 1997. "Global Trade Analysis: Modeling and applications," GTAP Books, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University, number 7685, December.
    3. Megumi Naoi & Shujiro Urata, 2013. "Free Trade Agreements and Domestic Politics: The Case of the Trans-Pacific Partnership Agreement," Asian Economic Policy Review, Japan Center for Economic Research, vol. 8(2), pages 326-349, December.
    4. Petri, Peter A., 2012. "The Trans-Pacific Partnership and Asia-Pacific Integration," 2012: New Rules of Trade? December 2012, San Diego, California 143184, International Agricultural Trade Research Consortium.
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    Cited by:

    1. Sheng Lu, 2018. "What Will Happen to the US Textile and Apparel Industry if the NAFTA Goes?," Margin: The Journal of Applied Economic Research, National Council of Applied Economic Research, vol. 12(2), pages 113-137, May.

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    More about this item

    Keywords

    International Trade; Japan; TPP; GTAP; Agriculture; CGE;
    All these keywords.

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F15 - International Economics - - Trade - - - Economic Integration
    • Q17 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agriculture in International Trade

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