Wyn Morgan

Trade liberalisation and growth in developing countries

Abstract Trade liberalisation in developing countries over the last 20 years has often been implemented with the expectation of growth being stimulated; yet the evidence on its growth enhancing effects is mixed. This paper argues that problems with mis-specification and the diversity of liberalisation indices used are in part responsible for the inconclusiveness. Using a dynamic panel framework and three different indicators of liberalisation, the paper finds that liberalisation does appear to impact upon growth, albeit with a lag. The evidence points to a J curve type response and this finding is robust to changes in specification, sample size and data period.

Trade Reform, Adjustment and Growth: What Does the Evidence Tell Us?

The contrast between the growth performance of East Asia at one extreme and sub-Saharan Africa at the other is a striking one. Much has been written about the contrast, especially in relation to the former. The reason for the interest is obvious: if there are elements of the East Asian experience which can be reproduced elsewhere then let us identify and replicate. One such common factor which a number of analysts believe they have identified is openness to international trade. More specifically, the growth of exports and the growth of GDP appear to be highly correlated (even if causality is sometimes in doubt) and on average, through time, countries with a more open trade orientation appear to do better. This proposition has underpinned an extraordinary wave of unilateral trade reform in developing countries. In the last twenty years over 90 countries have initiated some kind of reform or another. Some have been voluntary. Most, however, have been initiated by both Bretton Woods institutions but especially the World Bank under its Structural Adjustment Programme (SAP). Since 1980 a substantial proportion of total Bank lending has come through this window. Typically, any such loans are conditional on policy reform and in general trade policy reform figures prominently.1 Although there are political economy considerations which are relevant to the emphasis on trade policy reforms (such as the relative ease of monitoring change in that domain compared with others), the basic economic rationale is straightforward: if there appears to be a long term association between performance and openness and if an economy is presently relatively closed, then liberalisation is a necessary bridge to becoming more open. One can finesse the rationale in various ways but fundamentally that is what it comes down to. Has it worked? Has liberalisation of the World Bank inspired (or some might say required) variety proved to be a successful bridge? In other words has it led to growth? The reasons why it should or will not have been carefully presented by Dornbusch (1992) and Rodrik (1992, 1998) as well as Krueger and Taylor in this Controversy. Our concern here is not about the theory but the evidence. Overall is the evidence supportive of liberalisation providing a growth enhancing stimulus or not? In Section 1 we begin by setting out a series of

Trade liberalization and growth in developing countries: Some new evidence

Abstract The 1980s and 1990s have seen a remarkable wave of unilateral liberalization. In some cases the pressures for reform have been internal and programs have been designed and implemented without the involvement of any external agency. Where developing countries are concerned, in most cases, the key multilateral lending agencies have had a key role to play in securing commitment to reform, its design and implementation. Experience with trade reforms has been mixed with evidence of growth enhancement in some programs but of stagnation in many others. The focus of this paper is the effect of liberalization on growth of GDP. More specifically we concentrate on a group of countries which have liberalized in the post-1985 period. The sample is broadly based in its geographical coverage and in the stage of development of the countries concerned. Our sample also includes some 44 nonliberalizers over the period in question. Using panel data estimation techniques, we are interested in whether these recent liberalizations have been associated with faster or slower growth.

Buyer Power in U.K. Food Retailing: A 'First-Pass' Test

The potential existence of buyer power in U.K. food retailing has attracted the scrutiny of the U.K.s anti-trust authorities, culminating in the second of two comprehensive regulatory inquiries in recent years. Such inquiries are authoritative but correspondingly time-consuming and costly. Moreover, detection of buyer power has been dogged by the paucity of reliable evidence of its existence. In this paper, we present a simple theoretical model of oligopsony which delivers quasi-reduced form retailer-producer pricing equations with which the null of perfect competition can be tested using readily available market data. Using a cointegrated vector autoregression, we find empirical results that show the null of perfect competition can be rejected in seven of the nine food products investigated. Though not conclusive on the existence of buyer power, the proposed test offers a means via which the behaviour of the retail-producer price spread is consistent with it. At the very least, it can corroborate the concerns of the anti-trust authorities as to whether buyer power is potentially one source of concern.

Role of attitudes in the decision to use futures markets: The case of the London potato futures market

Although agricultural futures markets offer a number of potential benefits to users, the extent of trade involvemen in UK futures markets has been less than in comparable markets in the United States. This does not appear to be due to poorer hedging performance. An investigation into patterns of use of the London Potato Futures market suggests that nonusers, and to a lesser extent past users, have negative perceptions of futures trading and it is argued that this operates as a barrier to the more extensive use of futures markets among farmers and merchants.

Evaluación del nivel de aceptabilidad para las variedades Italia, Napoleón y Redglobe en el mercado español

Aiming to evaluate the acceptability level of three late varieties of table grape, the Unity of Comercialization and Agricultural Divulgation from the Department of Economy and Agricultural Social Science (E.T.S.I. Agronomos), from the Politecnical University of Madri, accomplished this study in July 1999. The sensorial analysis was applied for the evaluation of the acceptability level of three varieties of table grape: Italy, Redglobe and Napoleon. This analysis attempted to know the possible differences of sensorial character among the varieties. In the Spanish orchards, these varieties reached the harvest ripening in the same period. The flavor, followed by the succulence, were the determinant elements in the process of accepting the grape.

Nivel de aceptabilidad para cinco variedades de uva de mesa en el mercado español

Con el objetivo de evaluar el nivel de aceptabilidad con relacion a distintas variedades de uva de mesa, la Unidad de Comercializacion y Divulgacion Agraria del Departamento de Economia y Ciencias Sociales Agrarias (E.T.S.I.Agronomos), de la Universidad Politecnica de Madrid, realizo la presente investigacion en julio de 1999. Se utilizo el analisis sensorial en Sala de Catas como herramienta para la evaluacion del nivel de aceptabilidad de cinco variedades de uva de mesa. Se puso enfasis en conocer las posibles diferencias de caracter sensorial entre las variedades Flame Seedless, Cardinal, Superior Seedless, Victoria y Redgloble, variedades que coinciden en su epoca de cosecha en Espana. En los analisis hechos, las variedades Cardinal y Superior Seedless fueron las mas preferidas en comparacion con Flame Seedless, Victoria y Redgloble. La variedad Superior Seedless fue muy valorada por su ausencia de semillas, ademas de su buen sabor, lo que la torna de gran potencial para el mercado espanol. El sabor, seguido de la jugosidad, fueron los elementos determinantes en el proceso de aceptacion de la uva.

Trade Orientation and Economic Development: Theory and Evidence

Should developing countries follow an inwardly or outwardly orientated trade policy? A simple question which only has a simple answer to the simple-minded! This is an issue which has taxed at least two generations of development economists. It is also an issue which has taxed the multilateral lending agencies for some time. The belief that outward-orientated policies ‘work’ has had a very considerable influence on the design and implementation of policy conditionality in the IMF and World Bank.

Commodities and development: Some issues

Abstract This paper provides a review of a range of issues relating to the relationship between primary commodity markets and the process of economic development. As such, it provides a backdrop against which the various essays contained in this special issue may be seen.

Agricultural Export Subsidies and Developing Countries' Interests

A new impetus has been given to faltering WTO trade discussions by the recent EU mandate supporting the liberalisation of agricultural trade policies and removal of export subsidies on agricultural products, within an environment in which all countries start reforming their trade policies. Until now, discussions have centred on agriculture in general, rather than at specific commodity level. This paper rises to the challenge laid down by the EU in identifying the specific commodities for which developing countries would gain benefit in any subsequent reforms. Agricultural Export Subsidies and Developing Countries’ Interests outlines the nature of export subsidies. It discusses the effect of reform on developing countries, indicating the scale of any changes. The policy implications of removing agricultural support in the EU are given and the consequences for net food exporting and importing countries examined. Finally, the paper considers the impact of EU agricultural policy reform on other policies, such as the Protocols of the Lome Convention.