Effects of Protection and Exchange Rate Policies on Agricultural Trade: Implications for Argentina, Brazil, and Mexico

摘要

The effects of reducing countries' protection of the agricultural and nonagricultural sectors are assessed, with emphasis on Argentina, Brazil, and Mexico. By modeling simultaneously all goods sectors of the economy in a multicountry framework, the authors evaluate the importance of (1) the relative rates of protection between the agricultural and nonagricultural sectors and (2) exchange rate adjustments that follow trade liberalization in a world of floating rates. The authors find that net agricultural trade for Argentina and Brazil would improve substantially, particularly if both trade barriers and exchange rates were liberalized multilaterally.