How does Trade Risk Influence Agricultural Policy?

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International trade provides critical access to food, especially for countries that cannot cost-effectively produce enough domestically. If importing food is cheaper, why do so many countries keep protecting their own agricultural production, especially considering the core tenet of international trade that countries should specialize in producing goods in which they hold a comparative advantage?

This seminar will focus on research that can help explain why food-importing countries with low agricultural productivity use their resources to produce food domestically. We will discuss new research showing that the risk of trade disruptions shapes how countries set policy for agricultural production. While trade can provide cheaper access to food, it also makes countries vulnerable to disruptions, such as those triggered by geopolitical conflicts, climate shocks, or supply chain breakdowns. In the presence of international trade disruptions, net-importing countries face difficult choices between openness to trade and domestic food production. This event will be relevant to those working in trade policy and domestic fiscal policy relating to agriculture.

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Host or Publisher International Food Policy Research Institute (IFPRI)