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Abstract

The market conditions proposed by CAFTA are likely to positively impact the U.S. rice sector. Despite the differences in the impact of the agreement, both analytical approaches, namely, partial and general equilibrium modeling, yield results in the same direction. The small difference in the results from both approaches suggests low income and cross-sectoral effects between the U.S. rice sector and other segments of the economy. U.S. rice production is likely to expand to meet an increasing international demand for this commodity. The U.S. rice milling industry should also expect benefits from CAFTA, expanding by 1 percent in the general equilibrium model and up to 8 percent in the partial equilibrium framework.

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