US-Brazil cotton dispute and the world cotton market

William Ridley, Stephen Devadoss

Research output: Contribution to journalArticle

Abstract

US policies for its cotton producers depress world cotton prices, adversely affecting exporters such as Brazil, which filed a complaint to the WTO. Despite WTO rulings in Brazil's favour, meting out the right to enact retaliatory countermeasures, the United States continues to subsidise its cotton farmers. After prolonged negotiations, Brazil and the United States reached an agreement which allowed the United States to pay Brazil to refrain from enforcing the countermeasures. To capture the adverse effects of US policies, theoretical analyses are conducted. The theoretical model is extended by constructing an empirical model of the world cotton market. The adverse effects of US policies on Brazil are estimated and compared to the compensation the United States pays Brazil.

Original languageEnglish (US)
Pages (from-to)1081-1100
Number of pages20
JournalWorld Economy
Volume37
Issue number8
DOIs
StatePublished - Aug 2014
Externally publishedYes

ASJC Scopus subject areas

  • Accounting
  • Finance
  • Economics and Econometrics
  • Political Science and International Relations

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