Files
Abstract
It is often said that trade liberalization, unlike a soccer game, has no losers. While this is true in
theory and possibly from a global point of view, the situation is much different when considered at
the industry level and even more from a perspective of the likely effect on the returns to various
factors of production in the industry. It is against this backdrop that ~e paper focuses attention on
the poultry (broiler) industry in Trinidad and Tobago and considered the likely effect of trade
liberalization on the relative share of the return to the various factors of production. Specifically,
the paper makes use of the Floyd's (1965) one-product, two input model to investigate the effect of
restricted (use of a tariff) and unrestricted free trade on the relative factor share accruing to the
processors as against that to the contract growersjThe findings indicate that whereas in both cases
the producers (farmers and processors together) would experience a reduction in their surpluses,
when viewed from a point of the relative returns to the processors as against that to the growers, the
latter would bear a disproportionate amount ofthe loss. On the basis of these findings policy options
are suggested to assist in cushioning the effects of trade liberalization on the part of the grower.