Reducing Distortions in International Commodity Markets : an Agenda for Multilateral Cooperation
World commodity markets-and particularly the markets for agricultural commodities-remain highly distorted despite the wave of liberalization that has swept world trade since the 1980s. Some markets for commodities are characterized by imperfect com...
| Main Authors: | , |
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| Format: | Working Paper |
| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2017
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/356711468329343533/Reducing-distortions-in-international-commodity-markets-an-agenda-for-multilateral-cooperation http://hdl.handle.net/10986/27431 |
| Summary: | World commodity markets-and particularly
the markets for agricultural commodities-remain highly
distorted despite the wave of liberalization that has swept
world trade since the 1980s. Some markets for commodities
are characterized by imperfect competition. Where monopolies
or oligopolies in trade arise either because of government
regulation or through other barriers to entry, distortions
may arise that call for the application of antitrust law and
other forms of pro- competitive policy action. Commodity
markets are distorted on both the export and the import
sides, with serious implications for world prices and their
volatility. Governments also have a long history of
intervening in markets for other natural resources, both
renewable and non-renewables. Protection rates for imports
of non-agricultural natural resources are generally low
because of pressure from user industries. However, importing
countries confronting exporters of resources with market
power and thus the ability to affect world prices may seek
to use import tariffs or excise taxes to lower demand and
shift rents away from supplying nations. In sum, a wide mix
of policy instruments is used by countries to influence the
level and volatility of domestic prices for commodities.
Countries also pursue policies that may affect international
prices, either indirectly or directly, if they are large
suppliers or importers. |
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