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Impacts of trade, environmental and agricultural policies in the North American hog/pork industry on water quality, trade patterns and welfare Savard, Marielle


The objectives of this study were: (1) to design a framework to measure the impact of trade, agricultural and environmental policies on water quality and (2) to assess trade patterns and market welfare (Marshallian measures of producer and consumer surpluses plus government payments) under various combinations of agricultural, environmental and trade policies. To reach those objectives, an environmental model, EPIC, was linked to a model of the North American hog/pork sector. Results show that trade liberalization does not contribute to water pollution in the two cases studies': Raleigh, North Carolina or Pont-Rouge Quebec. In fact, leaching, of nitrates decreases in Quebec following the elimination of countervailing duties, stabilization payments and the ban on US live hog exports to Canada. When nutrient management plans are implemented, both surface and groundwater quality increase. Environmental policies, including nutrient plans, also have a clear impact on trade patterns. The reduction in Quebec inventories triggers a decrease of Canadian live hog exports to the US and an increase of US pork exports to Canada. Trade and agricultural policy scenarios have a larger impact on trade patterns than on welfare and water quality. When the ban on US live hog exports to Canada is lifted, US live hog exports to Canada increase at the expense of US pork exports and Canadian live hog exports to the US. Market welfare impacts from trade policies are different from impacts induced by environmental policies. Trade policy scenarios trigger increases in North American market welfare while environmental policies are responsible for decreases in market welfare. Since trade liberalization has a positive impact on welfare, the welfare decrease from environmental policy is somewhat attenuated under free trade conditions.

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