AbstractThis article reviews innovative research that has emerged in recent years, both in the general economics literature and as applied to agricultural and food policies. There have been important innovations and new insights in these fields, particularly regarding the micro‐foundations of political decision‐making, the impact of political institutions and ideology, and the role of the media. Data have also improved substantially. However, there are still important gaps in our understanding. Further research should focus on capturing interactions between explanatory variables, more refined measurement of (political) institutions and reforms, the effects of international agreements, broader representation of agents, more explicit modeling of crises, discontinuous effects, and the interaction of multiple policies.
Only a few years ago the widely shared view was that low food prices were a curse to developing countries and the poor. The dramatic increase of food prices in 2006-2008 appears to have fundamentally altered this view. The vast majority of analyses and reports in 2008 and 2009 state that high food prices have a devastating effect on developing countries and the world's poor. This reversal of opinion raises questions about the old and the new arguments and about the proposed remedies. It also raises questions about the causes of this dramatic turnaround in analysis and policy conclusions. In this paper I document these changes in perspective and I discuss potential implications and offer hypotheses on the cause of the change in views.
The 2003 refirm of the European Union's Common Agricultural Policy (CAP) under Commissioner Fischler was the most radical in the history of the CAP. This paper analyzes the causes and constraints of the refirm. The paper argues that an unusual combination of pro-refirm factors came together in the first years of the 21st century, making this refirm possible.
This paper presents a political economy model of public standards in an open economy model. We use the model to derive the political optimum and to analyze different factors that have an influence on this political equilibrium. The paper discusses how the level of development influences the political equilibrium. We also analyze the relation between trade and the political equilibrium and compare this political outcome with the social optimum to identify under which cases `under-standardization?or `over-standardization?results, and which standards can be labeled as (producer)protectionist measures.
In: World development: the multi-disciplinary international journal devoted to the study and promotion of world development, Band 37, Heft 1, S. 161-178
In: World development: the multi-disciplinary international journal devoted to the study and promotion of world development, Band 36, Heft 11, S. 2170-2187
In: World development: the multi-disciplinary international journal devoted to the study and promotion of world development, Band 32, Heft 9, S. 1525-1544
The paper analyzes the linkages between the reform strategies in transition countries and economic performance. We focus on agriculture because of the sharpness of the policy changes, fundamental differences among countries, and relative simplicity of agricultural relationships. We document post reform performance in the transition countries of Asia and Europe. We show how: a.) pricing reform and subsidy reductions; b.) land rights reform and policies that affect farm restructuring; and c.) the presence institutions that facilitate exchange (either markets or market substitutes) affect output and productivity. The paper ends with general lessons on reforms and transition.
In: World development: the multi-disciplinary international journal devoted to the study and promotion of world development, Band 30, Heft 3, S. 457-474
The overall objectives of our proposed paper is to: (a) systematically document the post-reform trends in agricultural performance in Asia, Europe, and the Former Soviet Union; (b) identify the main reform strategies and institutional innovations that have contributed to the successes and failures of the sector; (c) analyze the mechanisms by which reform policies and initial conditions have affected the transition process in agriculture; and (d) draw lessons and policy implications from the experiment and identify the gaps in our understanding of the role and performance of agriculture in transition. As part of this effort, we attempt to address a number of intriguing and important questions on the performance of individual countries or regions during transition. Why has China been so successful in its reforms, while Russia has not? Why is it that some CEECs have rebounded and showing robust productivity growth, while others have not? Why has agriculture in so many FSU nations continued to perform so poorly? In addition, we will address questions about the process of reform. Why has land restitution predominated in Europe but not in Russia or China? Why did institutions of exchange collapse in the non-Asian economies in the early stages of reform but continued to function in Vietnam and China? What explains the apparent divergence in the performance effects after the first year of reform in China and Vietnam, on the one hand, and much of the rest of the transitional world on the other? In particular, how have land reform and rural input-supply/procurement enterprise restructuring affected productivity? Which institutions of exchange and contracting have or have not emerged, and why? How has the structure of the economy at the outset of transition, and other initial conditions, affected the transition process? To meet our objectives and answer some of the questions, we will begin by laying out the record on performance — examining the main bodies of data that demonstrate the changes in agricultural output, income, and productivity in the years after transition. In doing so, we will show how some of the countries have recorded similar performances, while others have developed quite differently. We will identify several "patterns of transition" based on these performance indicators and much of our subsequent discussion will analyze the success of transition according to these classifications. Next, as the first step in our search for answers as to what explains these different patterns, we examine differences in the points of departure of the transition countries as well as the nature of the policy reforms that have affected agriculture. The initial conditions that we hypothesize may explain part of the transition period's performance include the nature of agricultural technology at the beginning of the reforms (its scale; its labor intensiveness; etc.), the structure of the economy (the extent of industrialization), the extent of collectivization, and the magnitude of trade distortions. The key policy interventions that we should expect to affect agriculture's performance during transition include land right reforms and farm restructuring; price and subsidization policies; the approach to the liberalization of agricultural commodity and input markets; general macro-economic and general institutional reforms; and the attention of sectoral leaders to the level of new and maintenance-oriented public goods investment (in agricultural research, irrigation, roads, and other infrastructure projects). After documenting the dramatic differences in initial conditions and in reform policies among the transitional countries, we seek to demonstrate which of the differences determine the path a country's agriculture takes. In other words, we offer answers to the question why transition in agriculture in some countries has been successful and not in others. Here, we seek to generalize about the main causes for differences between the countries and the mechanisms that have affected performance. In particular, we argue that the debate on the optimality of Big-Bang versus gradualism oversimplifies the reform problem. The empirical evidence suggests that the road to a successful transition is more subtle and successful transitions in Asia and Europe have elements of both gradual and radical reforms. To explain the reform successes and failures we emphasize the role of the political environment in the early reform years and the potential for agricultural growth that exists at the start of reforms. We find that both have not only influenced the choice of the reform policies, but also the effect of the reform policies. We also conclude that the initial level of price distortions and the pace of market liberalization were especially influential in explaining differences in the early stages of transition but that the influence of the factors has diminished over time. Investment, land rights, and farm restructuring policies, in contrast, are assuming a more important role as the agricultural reforms have matured. In the last section we draw policy implications and lessons from the agricultural transition experiences. We argue that one should be careful about which indicator to use for measuring success and failure of transition. We conclude that all reform strategies in order to be successful need to include some certain policy ingredients (such as continued investment, etc.). However, a powerful lesson is that although all the pieces are ultimately needed, there is a lot of room for variation in the form of institutions that can be successful, and optimal policies and institutions may vary according to initial conditions. In other words, there is no single optimal transition path.
In: World development: the multi-disciplinary international journal devoted to the study and promotion of world development, Band 40, Heft 3, S. 486-500