The World Trade Organization Special Safeguard Mechanism: A Case Study of Wheat |
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| Authors: | Jason H Grant Karl D Meilke |
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| Institution: | Jason H. Grant is a Ph.D. candidate in the Department of Agricultural Economics at Purdue University.;Karl D. Meilke is a professor in the Department of Agricultural Economics and Business at the University of Guelph. |
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| Abstract: | A special safeguard mechanism is an attractive policy tool for low-income importing countries because it is automatic and does not require an injury test. Exporters might accept a safeguard for low-income countries if it results in larger tariff cuts than in its absence. The effects of a special safeguard mechanism on market stability and welfare are evaluated using wheat as a case study. The results show that a safeguard mechanism is not very trade distorting. Almost 80% of the increase in world welfare is still realized when low-income countries are granted a safeguard mechanism. |
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