IDEAS home Printed from https://ideas.repec.org/p/ags/pugtwp/331050.html
   My bibliography  Save this paper

Key Assumptions in AGE Trade Models: An Assessment using the Mirage Model

Author

Listed:
  • Bchir, Mohamed Hedi
  • Decreux, Yvan
  • Guérin, Jean-Louis
  • Jean, Sébastien

Abstract

AGE models are among the main tools for assessing trade policies, but the adequacy of a model and the relevance of the results it delivers are wholly dependant on the analytical framework and on the parameters chosen. Based on the newly-built model Mirage (Modeling International Relationships in Applied General Equilibrium, a model built by the Cepii, with the collaboration of the ITC, Geneva), this paper discusses the main aspects of these choices, and illustrates their consequences for trade policy assessment through various sensitivity analysis exercises, for scenarios designed on purpose. The aim is both to reach a better understanding of underlying mechanisms, and to provide a greater transparency to the analysis of trade policies through AGE models. The topics discussed include: - Imperfect competition and product differentiation, for which a new calibration procedure is proposed, in order to take more consistently advantage of the results of econometric studies, for a rather standard model of horizontal product differentiation under oligopolistic competition ?la Cournot. - Dynamic setting, with special attention devoted to the questions of production factors mobility and of market structure's adjustment, and of their interaction with trade evolutions. - Foreign direct investments, in the light of the recent empirical results. - Product demand, including the question of products quality. - Externalities of trade and investment flows on productivity. For each of these aspects, a specific context (aggregation and scenario) is first chosen, so as to enlighten the corresponding stakes. Various hypothesis and parametrizations are then studied alternatively. The aim is to assess how relevant each aspect is for trade policy analysis, and how robust its modelling is. The simulations are carried out using the multinational model Mirage, calibrated with the GTAP5 database, except for protection, where the MAcMaps database (Market Access Maps developed by ITC and CEPII on the basis of UNCTAD-TRAINS, AMAD, UNSD-COMTRADE and WTO notifications) is used.

Suggested Citation

  • Bchir, Mohamed Hedi & Decreux, Yvan & Guérin, Jean-Louis & Jean, Sébastien, 2002. "Key Assumptions in AGE Trade Models: An Assessment using the Mirage Model," Conference papers 331050, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    • Handle: RePEc:ags:pugtwp:331050
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/331050/files/3472.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Hertel, Thomas W. & Kym Anderson & Joseph Francois & Will Martin, 2002. "Agriculture and Non-Agricultural Liberalization in the Millennium Round," GTAP Working Papers 235, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University.
    2. J-C Bureau & L Fulponi & L Salvatici, 2000. "Comparing EU and US trade liberalisation under the Uruguay Round Agreement on Agriculture," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 27(3), pages 259-280, September.
    3. Gibson, Paul R. & Wainio, John & Whitley, Daniel B. & Bohman, Mary, 2001. "Profiles Of Tariffs In Global Agricultural Markets," Agricultural Economic Reports 34055, United States Department of Agriculture, Economic Research Service.
    4. Thomas L. Cox & Jonathan R. Coleman & Jean-Paul Chavas & Yong Zhu, 1999. "An Economic Analysis of the Effects on the World Dairy Sector of Extending Uruguay Round Agreement to 2005," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 47(5), pages 169-183, December.
    5. Yong Zhu & Thomas L. Cox & Jean-Paul Chavas, 1999. "An Economic Analysis of the Effects of the Uruguay Round Agreement and Full Trade Liberalization on the World Dairy Sector," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 47(5), pages 187-200, December.
    6. A. T. Blake & A. J. Rayner & G. V. Reed, 1999. "A Computable General Equilibrium Analysis of Agricultural Liberalisation: The Uruguay Round and Common Agricultural Policy Reform," Journal of Agricultural Economics, Wiley Blackwell, vol. 50(3), pages 400-424, September.
    7. Ingco, Merlinda D., 1995. "Agricultural trade liberalization in the Uruguay Round : one step forward, one step back?," Policy Research Working Paper Series 1500, The World Bank.
    8. 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.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Youssef Chahed & Sophie Drogue & Luca Salvatici, 2001. "Protection du secteur agricole dans les pays tiers : un outil pour les négociations du Millenium Round," Working Papers hal-02827128, HAL.
    2. Jean‐Christophe Bureau & Luca Salvatici, 2005. "Agricultural trade restrictiveness in the European Union and the United States," Agricultural Economics, International Association of Agricultural Economists, vol. 33(s3), pages 479-490, November.
    3. Bureau Jean-Christophe & Salvatici Luca, 2004. "WTO Negotiations on Market Access in Agriculture: a Comparison of Alternative Tariff Cut Proposals for the EU and the US," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 4(1), pages 1-35, March.
    4. Bureau, Jean-Christophe & Salvatici, Luca, 2002. "WTO Negotiations on Market Access in Agriculture: A Comparison of Alternative Tariff Cut Scenarios for the EU and the US," 2002 International Congress, August 28-31, 2002, Zaragoza, Spain 24883, European Association of Agricultural Economists.
    5. Ahmed, Wasim & Hussain, Safdar & Jafar, Rana Muhammad Sohail & Guang-Ju, Wang & Rabnawaz, Ambar & Saqib, Zulkaif Ahmed & JianZhou, Yang, 2016. "Impacts of Trade Liberalization on Dairy Industry in China," MPRA Paper 70385, University Library of Munich, Germany.
    6. Mai, Yinhua, 2008. "Removing border protection on wheat and rice: effects on rural income and food self-sufficiency in China," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 52(2), pages 1-19.
    7. DESBOIS, Dominique, 2015. "La qualité du lait a-t-elle un prix ? Une estimation hédonique de la valeur des attributs spécifiques du lait de vache," Review of Agricultural and Environmental Studies - Revue d'Etudes en Agriculture et Environnement (RAEStud), Institut National de la Recherche Agronomique (INRA), vol. 96(3), September.
    8. Lucian Cernat & Sam Laird & Alessandro Turrini, 2003. "How Important are Market Access Issues for Developing Countries in the Doha Agenda?," International Trade 0302004, University Library of Munich, Germany.
    9. Kym Anderson, 2003. "Trade Liberalization, Agriculture, and Poverty in Low-income Countries," WIDER Working Paper Series DP2003-25, World Institute for Development Economic Research (UNU-WIDER).
    10. Mahia, R. & Arce, Rafael de & Escribano, Gonzalo, 2005. "La protección arancelaria al comercio agrícola mundial diez años después de la firma del acuerdo sobre agricultura de la Ronda Uruguay [Agricultural Trade Barriers 10 years later Uruguay Round Trad," MPRA Paper 10460, University Library of Munich, Germany.
    11. Leudjou, Roland R., 2012. "The Doha Round and Food Security in the Dairy Sector in Cameroon: A Global Simulation Model (GSIM) Approach," Estey Centre Journal of International Law and Trade Policy, Estey Centre for Law and Economics in International Trade, vol. 13(01), pages 1-16, April.
    12. Jean‐Christophe Bureau & Houssein Guimbard & Sébastien Jean, 2019. "Agricultural Trade Liberalisation in the 21st Century: Has It Done the Business?," Journal of Agricultural Economics, Wiley Blackwell, vol. 70(1), pages 3-25, February.
    13. Pawlak, Karolina, 2013. "The development and significance of foreign trade in agri-food products in selected preferential trade agreements," Problems of World Agriculture / Problemy Rolnictwa Światowego, Warsaw University of Life Sciences, vol. 13(28), pages 1-9, December.
    14. Antimiani, Alessandro & Conforti, Piero & Salvatici, Luca, 2005. "Alternative Market Access Scenarios in the Agriculture Trade Negotiations of the Doha Round," Estey Centre Journal of International Law and Trade Policy, Estey Centre for Law and Economics in International Trade, vol. 6(2), pages 1-23.
    15. Kim , Sangkyom & Park , Innwon & Park , Soonchan, 2013. "A Free Trade Area of Asia Pacific (FTAAP): Is It Desirable?," East Asian Economic Review, Korea Institute for International Economic Policy, vol. 17(1), pages 3-25, March.
    16. 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.
    17. Eickhout, B. & Meijl, H. van & Tabeau, A. & Zeijts, H. van, 2004. "Between Liberalization and Protection: Four Long-term Scenarios for Trade, Poverty and the Environment," Conference papers 331268, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    18. Pelikan, J. & Brockmeier, M., 2009. "Wohlfahrtswirkungen einer Handelsliberalisierung: Welchen Einfluss hat die Zollaggregation auf die Modellergebnisse?," Proceedings “Schriften der Gesellschaft für Wirtschafts- und Sozialwissenschaften des Landbaues e.V.”, German Association of Agricultural Economists (GEWISOLA), vol. 44, March.
    19. Antoine Bouët & Jean‐Christophe Bureau & Yvan Decreux & Sébastien Jean, 2005. "Multilateral Agricultural Trade Liberalisation: The Contrasting Fortunes of Developing Countries in the Doha Round," The World Economy, Wiley Blackwell, vol. 28(9), pages 1329-1354, September.
    20. Peng, Tingjun & Cox, Thomas L., 2005. "An Economic Analysis of the Impacts of Trade Liberalization on Asian Dairy Market," Staff Paper Series 490, University of Wisconsin, Agricultural and Applied Economics.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:pugtwp:331050. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/gtpurus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.