Potential Implications of a Special Safeguard Mechanism in the World Trade Organization : The Case of Wheat

The special safeguard mechanism—both quantity- and price-based—was key in the July 2008 failure to reach agreement in the World Trade Organization negotiations under the Doha Development Agenda. A stochastic simulation model of the world wheat market is used to investigate the effects of the special...

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Main Authors:	Hertel, Thomas W., Martin, Will, Leister, Amanda M.
Format:	Journal Article
Published:	World Bank 2012
Subjects:	average price commodity prices competitiveness domestic market international markets market price market volatility price adjustment price changes price variations price volatility producer price producer prices sale substitution supplier suppliers supply curve world market world markets
Online Access:	http://hdl.handle.net/10986/4524

id	okr-10986-4524
recordtype	oai_dc
spelling	okr-10986-45242021-04-23T14:02:18Z Potential Implications of a Special Safeguard Mechanism in the World Trade Organization : The Case of Wheat Hertel, Thomas W. Martin, Will Leister, Amanda M. average price commodity prices competitiveness domestic market international markets market price market volatility price adjustment price changes price variations price volatility producer price producer prices sale substitution supplier suppliers supply curve world market world markets The special safeguard mechanism—both quantity- and price-based—was key in the July 2008 failure to reach agreement in the World Trade Organization negotiations under the Doha Development Agenda. A stochastic simulation model of the world wheat market is used to investigate the effects of the special safeguard mechanism. As expected, the quantity-based safeguard is found to reduce imports, raise domestic prices, and boost mean domestic production in the countries that implement it. However, rather than insulating developing countries in those regions from price volatility, the quantity-based safeguard increases domestic price volatility, largely by restricting imports when domestic output is low and prices are high. The quantity-based safeguard shrinks average wheat imports nearly 50 percent in some regions, and global wheat trade falls by 4.7 percent. The price-based safeguard discriminates against lower price exporters and contributes to producer price instability. 2012-03-30T07:12:38Z 2012-03-30T07:12:38Z 2010-08-30 Journal Article World Bank Economic Review 1564-698X http://hdl.handle.net/10986/4524 CC BY-NC-ND 3.0 IGO http://creativecommons.org/licenses/by-nc-nd/3.0/igo World Bank World Bank Journal Article Australia
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
topic	average price commodity prices competitiveness domestic market international markets market price market volatility price adjustment price changes price variations price volatility producer price producer prices sale substitution supplier suppliers supply curve world market world markets
spellingShingle	average price commodity prices competitiveness domestic market international markets market price market volatility price adjustment price changes price variations price volatility producer price producer prices sale substitution supplier suppliers supply curve world market world markets Hertel, Thomas W. Martin, Will Leister, Amanda M. Potential Implications of a Special Safeguard Mechanism in the World Trade Organization : The Case of Wheat
geographic_facet	Australia
description	The special safeguard mechanism—both quantity- and price-based—was key in the July 2008 failure to reach agreement in the World Trade Organization negotiations under the Doha Development Agenda. A stochastic simulation model of the world wheat market is used to investigate the effects of the special safeguard mechanism. As expected, the quantity-based safeguard is found to reduce imports, raise domestic prices, and boost mean domestic production in the countries that implement it. However, rather than insulating developing countries in those regions from price volatility, the quantity-based safeguard increases domestic price volatility, largely by restricting imports when domestic output is low and prices are high. The quantity-based safeguard shrinks average wheat imports nearly 50 percent in some regions, and global wheat trade falls by 4.7 percent. The price-based safeguard discriminates against lower price exporters and contributes to producer price instability.
format	Journal Article
author	Hertel, Thomas W. Martin, Will Leister, Amanda M.
author_facet	Hertel, Thomas W. Martin, Will Leister, Amanda M.
author_sort	Hertel, Thomas W.
title	Potential Implications of a Special Safeguard Mechanism in the World Trade Organization : The Case of Wheat
title_short	Potential Implications of a Special Safeguard Mechanism in the World Trade Organization : The Case of Wheat
title_full	Potential Implications of a Special Safeguard Mechanism in the World Trade Organization : The Case of Wheat
title_fullStr	Potential Implications of a Special Safeguard Mechanism in the World Trade Organization : The Case of Wheat
title_full_unstemmed	Potential Implications of a Special Safeguard Mechanism in the World Trade Organization : The Case of Wheat
title_sort	potential implications of a special safeguard mechanism in the world trade organization : the case of wheat
publisher	World Bank
publishDate	2012
url	http://hdl.handle.net/10986/4524
_version_	1764391739425030144

Potential Implications of a Special Safeguard Mechanism in the World Trade Organization : The Case of Wheat

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