Agricultural trade and the importance of small and zero trade flows
This article discusses the limitations of existing economic models in predicting the trade consequences of large shocks in agricultural markets. Such models tend to be too conservative and fail to simulate the quick reorganization of trade flows that can occur in response to major shocks. The Working Package 2 of the BATModel project aims to address this issue by gathering data on prohibitive trade costs in the agricultural sector and developing modeling approaches that allow for zero trade flows to become positive and large after big shocks. The article highlights the importance of improving modeling approaches to help policy makers prepare for and cope with future crises in highly sensitive agricultural sectors crucial for food security.
Institut national de recherche pour l’agriculture, l’alimentation et l’environnement (INRAE)
Leader of Work Package 2 – Emerging trade flows