Distortions to Agricultural Incentives in Japan, Korea, and Taiwan

The story of agricultural policy in Northeast Asia over the past 50 years illustrates the dramatic changes that can occur in distortions to agricultural incentives faced by producers and consumers at different stages of economic development. In thi...

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Bibliographic Details
Main Authors:	Honma, Masayoshi, Hayami, Yujiro
Format:	Working Paper
Language:	English en_US
Published:	World Bank, Washington, DC 2017
Subjects:	ADVERSE IMPACT AGRIBUSINESS AGRICULTURAL ACTIVITIES AGRICULTURAL CENSUS AGRICULTURAL COMMODITIES AGRICULTURAL DEVELOPMENT AGRICULTURAL DIVERSIFICATION AGRICULTURAL ECONOMICS AGRICULTURAL EMPLOYMENT AGRICULTURAL HOUSEHOLDS AGRICULTURAL INDUSTRIES AGRICULTURAL LABOR AGRICULTURAL LABORERS AGRICULTURAL LAND AGRICULTURAL OUTPUT AGRICULTURAL POLICIES AGRICULTURAL POLICY AGRICULTURAL PRICES AGRICULTURAL PRICING POLICIES AGRICULTURAL PRICING POLICY AGRICULTURAL PROBLEMS AGRICULTURAL PRODUCT AGRICULTURAL PRODUCTION AGRICULTURAL PRODUCTIVITY AGRICULTURAL PRODUCTS AGRICULTURAL RESEARCH AGRICULTURAL SECTORS AGRICULTURAL WORKER AGRICULTURAL WORKERS AGRICULTURE ANIMAL FEED ANIMAL FEEDSTUFFS ARABLE LAND BARLEY BEEF BORDER MEASURES BORDER PRICES BREAD BROWN RICE CAPITA CONSUMPTION CASH CROPS CEREAL PRODUCTS CEREALS CHEMICAL FERTILIZERS CHEMICAL INDUSTRIES COMMODITIES COMMODITY COMPARATIVE ADVANTAGE CONFLICTING NEEDS CONSUMER PRICE INDEX CONSUMERS CONSUMPTION LEVELS CORN COTTON COTTON SPINNING CROP CROP DIVERSIFICATION CROP PRODUCTS CROP SUBSTITUTION DAMAGES DEVELOPMENT ECONOMICS DEVELOPMENT RESEARCH DEVELOPMENT STRATEGIES DIET DISEQUILIBRIUM DOMESTIC MARKET PRICES DRAINAGE DRAINAGE INFRASTRUCTURE ECONOMIC DEVELOPMENT ECONOMIC GROWTH ECONOMIC POWER ECONOMIC STATISTICS ECONOMIC STRUCTURES EGG EXCHANGE RATES EXPORT CROPS EXTENSION EXTENSION SERVICES FARM FARM ACTIVITIES FARM EMPLOYMENT FARM EMPLOYMENT OPPORTUNITIES FARM HOUSEHOLDS FARM INCOME FARM INCOMES FARM LAND FARM PRODUCTS FARMERS FARMING FARMLAND FARMS FERTILIZER FOOD AID FOOD CONTROL FOOD CROPS FOOD GRAINS FOOD LAW FOOD PRICES FOOD PRODUCTION FOOD SECURITY FOOD STAPLES FREE MARKETS FREE TRADE FRUITS GARLIC GDP PER CAPITA GOVERNMENT SUBSIDIES GRAIN GRAIN PRICES GROWTH IN AGRICULTURE HARVEST IMPORT BARRIERS IMPORT QUOTAS INCOME INCOME DISTRIBUTION INCOME LEVELS INDUSTRIAL WORKERS INFLATION RATES INTERNATIONAL TRADE IRRIGATION LABOR FORCE LABOR PRODUCTIVITY LAND PRODUCTIVITY LAND REFORM LANDS LIGHT INDUSTRIES LIVESTOCK LIVESTOCK PRODUCERS LIVESTOCK PRODUCTS LIVING STANDARDS LOW TARIFF MARKETING MEAT MEAT PRODUCTS MILK NATIONAL INCOME ORANGE PADDY PADDY RICE PEPPER PER CAPITA INCOME PER CAPITA INCOMES PESTICIDES PLANTATIONS POLITICAL ECONOMY PORK POULTRY PRICE DECLINES PRODUCTION COST PRODUCTION INCENTIVES PRODUCTION INCREASES PRODUCTIVITY PRODUCTIVITY GROWTH PROTECTIONISM PURCHASING POWER RAPID INDUSTRIALIZATION RAW MATERIALS REAL GDP REGRESSION ANALYSIS RICE RICE CULTIVATION RICE FIELDS RICE PRICE RICE PRICES RICE PROCUREMENT RICE PRODUCTION RICE TRADE RICE YIELDS ROCKEFELLER FOUNDATION RURAL DEVELOPMENT RURAL INCOME RURAL POPULATION RYE SILK SMALL-SCALE INDUSTRY SORGHUM SOYBEAN SPINACH STAPLE FOODS STEEL STRUCTURAL ADJUSTMENT STRUCTURAL CHANGE SUBSISTENCE CROPS SUGAR TAXATION TEA URUGUAY ROUND VEGETABLES VILLAGE COMMUNITIES WAGE RATES WAGES WEALTH WHEAT WHOLESALE PRICES WORLD FOOD CRISES WORLD TRADE ORGANIZATION WTO
Online Access:	http://documents.worldbank.org/curated/en/149401468331189545/Main-report http://hdl.handle.net/10986/28189

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Summary:	The story of agricultural policy in Northeast Asia over the past 50 years illustrates the dramatic changes that can occur in distortions to agricultural incentives faced by producers and consumers at different stages of economic development. In this study of Japan, the Republic of Korea (the southern part of the peninsula, hereafter referred to as Korea) and the island of Taiwan, China (hereafter referred to as Taiwan), the authors estimate the degree of distortions for key agricultural products as well as for the agricultural sector as a whole over a period when these economies transitioned from low- or middle- to high-income status the beginning of the so-called East Asian economic miracle of dramatic industrial development. The three economies in terms of the nature of their economies, including their resource endowments that determined the course of their modern economic growth and development. The evolution of agricultural policies in the three economies is then reviewed before discussing how to measure distortions to agricultural incentives using the methodology from Anderson et al. (2008), the focus of which is on nominal and relative rates of assistance. Implications of empirical findings for policy reforms in the three economies are discussed in the final section, where the authors also identify lessons for later-developing economies experiencing similar structural transformations in the course of their economic growth. Statistical observations are found to be consistent with the hypothesis that the success of rapid industrialization that advanced these economies to the middle-income stage resulted in declines in agriculture's comparative advantage associated with the growing income disparity between farmers and employees in non-agricultural sectors.

Distortions to Agricultural Incentives in Japan, Korea, and Taiwan

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