Policy Options for the Poultry (Broiler) Industry in Trinidad and Tobago Under a Liberalized Trade Regime

It is often said that trade liberalization, unlike a soccer game, has no losers. While this is true in theory and possibly from a global point of view, the situation is much different when considered at the industry level and even more from a perspective of the likely effect on the returns to various factors of production in the industry. It is against this backdrop that ~e paper focuses attention on the poultry (broiler) industry in Trinidad and Tobago and considered the likely effect of trade liberalization on the relative share of the return to the various factors of production. Specifically, the paper makes use of the Floyd's (1965) one-product, two input model to investigate the effect of restricted (use of a tariff) and unrestricted free trade on the relative factor share accruing to the processors as against that to the contract growersjThe findings indicate that whereas in both cases the producers (farmers and processors together) would experience a reduction in their surpluses, when viewed from a point of the relative returns to the processors as against that to the growers, the latter would bear a disproportionate amount ofthe loss. On the basis of these findings policy options are suggested to assist in cushioning the effects of trade liberalization on the part of the grower.