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Global Trade and Margins of Productivity in Agriculture

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  • Farid Farrokhi
  • Heitor S. Pellegrina

Abstract

We study the effects of globalization on agricultural productivity across countries. We develop a multi-country general equilibrium model that incorporates choices of crops and technologies in agricultural production at the micro-level of fields covering the surface of the earth. We estimate our model using field-level data on potential yields of crops under different technologies characterized by factor and input intensity. We evaluate the welfare and productivity gains from reductions in trade costs of agricultural outputs and inputs across countries between 1980 and 2015. In addition to gains from international crop specialization, we find notable gains from access to foreign agricultural inputs. This mechanism operates through a shift from traditional (labor-intensive) technologies to modern (input-intensive) ones.

Suggested Citation

  • Farid Farrokhi & Heitor S. Pellegrina, 2020. "Global Trade and Margins of Productivity in Agriculture," NBER Working Papers 27350, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:27350
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    Cited by:

    1. Heitor Pellegrina & Sebastian Sotelo, 2019. "Migration, Specialization and Trade: Evidence from the Brazilian March to the West," 2019 Meeting Papers 863, Society for Economic Dynamics.

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    More about this item

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F60 - International Economics - - Economic Impacts of Globalization - - - General
    • Q16 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - R&D; Agricultural Technology; Biofuels; Agricultural Extension Services
    • R14 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Land Use Patterns

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