Market Structure Impacts on Market Distortions from Domestic Subsidies: The U. S. Cotton Case

This analysis uses a residual demand elasticity model to measure market power in the international cotton market. The results indicate that China exerts significant market power and affects cotton prices. Those results, combined with a partial equilibrium model of the international cotton market, are used to evaluate the welfare consequences of U.S. cotton subsidy policies for major cotton exporters under alternative assumptions about global market structure. The results indicate that the effects of U.S. subsidies on the world cotton price are much smaller under an imperfectly competitive international market than under a perfectly competitive market scenario; the former appears to be a realistic case.

Issue Date:
Dec 24 2010
Publication Type:
Journal Article
DOI and Other Identifiers:
1496-5208 (Other)
Record Identifier:
PURL Identifier:
Published in:
Estey Journal of International Law and Trade Policy, Volume 11, Number 2
Page range:
Total Pages:
Series Statement:
Estey Centre Journal of International Law and Trade Policy
Volume 11, Number 2, Summer 2010

 Record created 2017-04-01, last modified 2018-01-22

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