Export Restrictions and Price Insulation during Commodity Price Booms
For individual countries, variable trade barriers can be used to reduce the volatility of domestic relative to world prices. If this is done by countries accounting for a large share of the market, its effect is offset by increases in world price v...
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| Format: | Policy Research Working Paper |
| Language: | English |
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2012
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| Online Access: | http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20110502082850 http://hdl.handle.net/10986/3409 |
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okr-10986-34092021-04-23T14:02:09Z Export Restrictions and Price Insulation during Commodity Price Booms Martin, Will Anderson, Kym ADMINISTERED PRICES AGRICULTURAL COMMODITIES AGRICULTURAL PRICE AUTARCHY BARRIER COMMODITIES COMMODITY COMMODITY PRICE COMMODITY PRICES CONSUMER PRICE DEMAND CURVE DEVELOPING COUNTRIES DEVELOPING COUNTRY DOMESTIC MARKET DOMESTIC PRICE DOMESTIC PRICES FINANCIAL MARKET FOOD COMMODITIES FOOD COMMODITY FOOD PRICE FOOD PRICES FREE TRADE GLOBAL MARKET HOMOGENOUS PRODUCT INCOME INDUSTRIAL COUNTRIES INTERNATIONAL COMMERCE INVENTORY INVENTORY LEVELS LOW-INCOME COUNTRIES MARKET ACCESS MARKET EQUILIBRIUM NONTRADABLE OPEN ACCESS OUTPUT POLITICAL ECONOMY PRICE CHANGES PRICE DISTORTIONS PRICE FLUCTUATIONS PRICE INCREASES PRICE INSTABILITY PRICE RISK PRICE STABILIZATION PRICE VOLATILITY PRODUCER PRICE PRODUCER PRICES RESULT RESULTS SOCIAL COST SOCIAL COSTS STABILIZATION POLICIES SUPPLY CURVE TAX TAX RATE TRADE TAX TRANSMISSION USERS VOLATILITY WEB WORLD MARKET WORLD MARKETS WORLD TRADE For individual countries, variable trade barriers can be used to reduce the volatility of domestic relative to world prices. If this is done by countries accounting for a large share of the market, its effect is offset by increases in world price volatility. This study shows the nature of the resulting collective action problem, with the policy being ineffective on average in stabilizing domestic prices while increasing the volatility of the income transfers from terms-of-trade changes. A simple approach to assessing the contribution of insulation to the price increases is developed and used with new estimates of agricultural distortions to assess its contribution to the price spikes in 1972-74 and 2006-08 for rice and wheat. The analysis suggests that 45 percent of the increase in rice prices in 2006-08, and 30 percent of the increase in wheat prices, was due to insulating behavior. One sign of progress since 1972-74 was a substantial reduction in the extent of price-insulating behavior by the industrial countries. This provides little stabilizing benefit in the rice market because countries not classifying themselves at the World Trade Organization as developing account for only 3 percent of world rice consumption. But it does offer some benefit for the wheat market where non-developing countries account for 27 percent of consumption. 2012-03-19T18:01:58Z 2012-03-19T18:01:58Z 2011-05-01 http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20110502082850 http://hdl.handle.net/10986/3409 English Policy Research working paper ; no. WPS 5645 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank Publications & Research :: Policy Research Working Paper The World Region The World Region |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English |
| topic |
ADMINISTERED PRICES AGRICULTURAL COMMODITIES AGRICULTURAL PRICE AUTARCHY BARRIER COMMODITIES COMMODITY COMMODITY PRICE COMMODITY PRICES CONSUMER PRICE DEMAND CURVE DEVELOPING COUNTRIES DEVELOPING COUNTRY DOMESTIC MARKET DOMESTIC PRICE DOMESTIC PRICES FINANCIAL MARKET FOOD COMMODITIES FOOD COMMODITY FOOD PRICE FOOD PRICES FREE TRADE GLOBAL MARKET HOMOGENOUS PRODUCT INCOME INDUSTRIAL COUNTRIES INTERNATIONAL COMMERCE INVENTORY INVENTORY LEVELS LOW-INCOME COUNTRIES MARKET ACCESS MARKET EQUILIBRIUM NONTRADABLE OPEN ACCESS OUTPUT POLITICAL ECONOMY PRICE CHANGES PRICE DISTORTIONS PRICE FLUCTUATIONS PRICE INCREASES PRICE INSTABILITY PRICE RISK PRICE STABILIZATION PRICE VOLATILITY PRODUCER PRICE PRODUCER PRICES RESULT RESULTS SOCIAL COST SOCIAL COSTS STABILIZATION POLICIES SUPPLY CURVE TAX TAX RATE TRADE TAX TRANSMISSION USERS VOLATILITY WEB WORLD MARKET WORLD MARKETS WORLD TRADE |
| spellingShingle |
ADMINISTERED PRICES AGRICULTURAL COMMODITIES AGRICULTURAL PRICE AUTARCHY BARRIER COMMODITIES COMMODITY COMMODITY PRICE COMMODITY PRICES CONSUMER PRICE DEMAND CURVE DEVELOPING COUNTRIES DEVELOPING COUNTRY DOMESTIC MARKET DOMESTIC PRICE DOMESTIC PRICES FINANCIAL MARKET FOOD COMMODITIES FOOD COMMODITY FOOD PRICE FOOD PRICES FREE TRADE GLOBAL MARKET HOMOGENOUS PRODUCT INCOME INDUSTRIAL COUNTRIES INTERNATIONAL COMMERCE INVENTORY INVENTORY LEVELS LOW-INCOME COUNTRIES MARKET ACCESS MARKET EQUILIBRIUM NONTRADABLE OPEN ACCESS OUTPUT POLITICAL ECONOMY PRICE CHANGES PRICE DISTORTIONS PRICE FLUCTUATIONS PRICE INCREASES PRICE INSTABILITY PRICE RISK PRICE STABILIZATION PRICE VOLATILITY PRODUCER PRICE PRODUCER PRICES RESULT RESULTS SOCIAL COST SOCIAL COSTS STABILIZATION POLICIES SUPPLY CURVE TAX TAX RATE TRADE TAX TRANSMISSION USERS VOLATILITY WEB WORLD MARKET WORLD MARKETS WORLD TRADE Martin, Will Anderson, Kym Export Restrictions and Price Insulation during Commodity Price Booms |
| geographic_facet |
The World Region The World Region |
| relation |
Policy Research working paper ; no. WPS 5645 |
| description |
For individual countries, variable trade
barriers can be used to reduce the volatility of domestic
relative to world prices. If this is done by countries
accounting for a large share of the market, its effect is
offset by increases in world price volatility. This study
shows the nature of the resulting collective action problem,
with the policy being ineffective on average in stabilizing
domestic prices while increasing the volatility of the
income transfers from terms-of-trade changes. A simple
approach to assessing the contribution of insulation to the
price increases is developed and used with new estimates of
agricultural distortions to assess its contribution to the
price spikes in 1972-74 and 2006-08 for rice and wheat. The
analysis suggests that 45 percent of the increase in rice
prices in 2006-08, and 30 percent of the increase in wheat
prices, was due to insulating behavior. One sign of progress
since 1972-74 was a substantial reduction in the extent of
price-insulating behavior by the industrial countries. This
provides little stabilizing benefit in the rice market
because countries not classifying themselves at the World
Trade Organization as developing account for only 3 percent
of world rice consumption. But it does offer some benefit
for the wheat market where non-developing countries account
for 27 percent of consumption. |
| format |
Publications & Research :: Policy Research Working Paper |
| author |
Martin, Will Anderson, Kym |
| author_facet |
Martin, Will Anderson, Kym |
| author_sort |
Martin, Will |
| title |
Export Restrictions and Price Insulation during Commodity Price Booms |
| title_short |
Export Restrictions and Price Insulation during Commodity Price Booms |
| title_full |
Export Restrictions and Price Insulation during Commodity Price Booms |
| title_fullStr |
Export Restrictions and Price Insulation during Commodity Price Booms |
| title_full_unstemmed |
Export Restrictions and Price Insulation during Commodity Price Booms |
| title_sort |
export restrictions and price insulation during commodity price booms |
| publishDate |
2012 |
| url |
http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20110502082850 http://hdl.handle.net/10986/3409 |
| _version_ |
1764386939977334784 |