Working Papers in Economics, Department of Economics, University of Bergen
How Effective are WTO Disciplines on Domestic Support and Market Access for Agriculture?
(), Ivar Gaasland
(), Roberto Garcia
() and Erling Vårdal
Abstract: A new round of trade negotiations under the World Trade
Organization (WTO) was launched in 2001. One of the major aims of the Doha
Development Round is to reduce agricultural protection and impose greater
discipline on domestic agricultural subsidies, particularly those that are
the most trade distorting. In this paper we examine whether the proposed
WTO modalities for agriculture will actually achieve this aim in Norway,
which ranks among the top providers of government assistance for
agriculture. Norway has a complex system of farm subsidies buttressed by
substantial import protection. The extent to which its agricultural support
policies will have to be changed in response to new WTO disciplines
provides an important indication of how successful these are likely to be.
We find that Norway will probably be able to sustain its current
agricultural activity and production levels while staying within the new
WTO rules. Following recent practice in some other WTO members, Norway will
be able to reduce its notified support without making real changes in some
of its programs. However, there will have to be a shift from market price
support, which is paid for by consumers through higher food prices, to
budgetary support paid by taxpayers and that could generate internal
pressures for policy reform.
Keywords: WTO; Doha-round; domestic support; market access; partial equilibrium model; (follow links to similar papers)
JEL-Codes: C69; F53; Q17; Q18; (follow links to similar papers)
36 pages, March 31, 2009
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