@article{Chau:127015,
      recid = {127015},
      author = {Chau, Nancy H. and Fare, Rolf},
      title = {Shadow Pricing Market Access: A Trade Benefit Function  Approach},
      address = {2007},
      number = {642-2016-43948},
      series = {WP},
      pages = {46},
      year = {2007},
      abstract = {Appropriate assessment of the social value of market  access is at the core of a broad
range of inquiries in  trade research. A selection include: the appraisal of  industry-level production
and consumption distortions due  to selective trade liberalization and partial tax  reform;
the construction of national-level quantity  indicators of market access consistent with welfare
change,  and the use of international trade re-balancing as  sanctions to discourage trade agreement
violations, or as  compensation in trade dispute settlement. In order to  obtain shadow
prices, we propose a new approach integrating  the Luenberger benet function and the directional
output  distance function. This yields a trade benet function which  represents trade
preferences a la Meade in the context of a  canonical general equilibrium model of trade. We
rst show  that our approach is in keeping with well-established and  commonly used measurement
techniques of trade welfare, for  the standard trade expenditure function is in fact dual  to
the trade benet function. We then show that this dual  relation allows for a direct retrieval of
the shadow values  of net imports from the trade benet function. The  usefulness and operationality
of our approach is then  demonstrated in a series of applications and simulations.},
      url = {http://ageconsearch.umn.edu/record/127015},
      doi = {https://doi.org/10.22004/ag.econ.127015},
}