Abstract
This study evaluates the impacts of the Uruguay Round Agreement on Agriculture (URAoA) on wheat using a partial equilibrium model. We apply cointegration method for Pakistan in order to examine whether there exists a stable long run relationship between farm gate price and wholesale price and between wholesale price and world price of wheat. Further Granger causality test is applied to discover the direction of influence between the prices. Price integration analysis shows that there is a stable long run relationship between farm gate price and wholesale price and between wholesale price and world price of wheat. Direction of influence is from world price to wholesale price and from wholesale price to farm gate price. The welfare analysis has been conducted by estimating the domestic demand and supply functions and by using the concepts of consumer and producer surpluses. It is found that loss in consumer surplus exceeds gain in producer surplus and the nation will have to face net welfare loss in case of wheat under trade liberalization.
Article Details
- Year: 2009
- Volume: 30
- Issue: 1
- Pages: 59 - 86
- Accepted: 01.01.2009
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DOI:
https://doi.org/10.5281/zenodo.20826341 -
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How to Cite?
Tahir Mukhtar, Mohammad Ishfaq (2009). WTO and Pakistan’s Agriculture: A Price Integration and Welfare Analysis for Wheat. Journal of Economic Cooperation and Development, 30(1), 59-86. https://doi.org/10.5281/zenodo.20826341
