Preferential Tariff Cuts Boost Welfare for Agricultural Exports from Developing Countries
The article compares the impact of reducing tariffs on agricultural exports from less developed countries in two ways: preferentially or generally. The study uses diagrams to show how different policies affect the welfare of countries involved. The analysis considers scenarios where countries switch between being importers and exporters based on price changes. Two types of welfare measures are used: one based on consumers and producers, the other includes domestic income and foreign exchange. The study discusses the model's limitations and finds that preferential tariff reductions can have different welfare effects compared to generalized reductions.