Positive Agricultural and Food Trade Model with Ad Valorem Tariffs

Abstract

Interest rate Ad valorem tariffs are considered as the most prominent trade tools extensively used in the framework of Spatial Equili brium Models (SEMs) to analyze agricultural and food trade policies around the wor ld. However the results obtained from such models have been criticized because of their i nadequacy in producing any observed data within the base period. Hence a positive spati al and temporal trade model which incorporates ad valorem tariffs was developed throughout the ongoing study . The calibrated model helps researchers to perform a sub stantially flawless empirical trade study in the real world. A numerical example is fin ally presented at the end of the article to justify the findings of the model, and to compar e welfare analysis of the calibrated vs. the uncalibrated model. Keywords: Ad valorem Tariff, Agricultural Trade Model, Calibration, Spatial Equilibrium Mode