Has agricultural trade liberalization improved welfare in the least-developed countries?
Author InfoIngco, Merlinda D. Abstract The author evaluates the progress in agricultural liberalization -and the welfare effects for least-developed and net food-importing countries- as a result of agricultural price shocks resulting from the Uruguay Round. She findsthat: (1) The changes in welfare are significantly affected by the structure of trade and distortions in the domestic economy. (2) Although many economies are hurt by increases in world prices, losses in terms of trade are small relative to total GDP. Only in a few countries does the estimated welfare change constitute more than 1 percent of GDP. (3) In several countries, the distortion effects are significantly larger than the terms-of-trade effects. In some cases, the distortion effects work in opposition to the terms-of-trade effects and are large enough to reverse the sign of the net welfare change. In short, removing policy distortions could convert the small loss in terms of trade to potential gains. But many least-de
