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Nameless "Experts" Mourn Failure of WTO Round
Experts without names were out in force today expressing their unhappiness over the latest failure to reach an agreement in the Doha Round of the WTO. The NYT told readers that "some Doha skeptics about the necessity of a global agreement. But experts said it was important, particularly as a bulwark against rising protectionist sentiments." Later, the article reported that: "A trade deal, economists said, would have been a valuable tonic."
While the article does give quotes from named economists and presumed experts who hold the views ascribed, these positions are clearly not shared by all economists and experts. It would have been more appropriate to simply present these opinions as the views of the economists/experts who were consulted for this article rather than imply that these views are held by all economists/experts.
The article repeatedly warns about governments being pushed by popular sentiments away from the sort of deal that the negotiators were trying to reach. It might have been worth examining why such agreements are so unpopular.
It also would have been appropriate to point out that the proponents of the new WTO deal can't even agree in their public pronouncements about what they expect its effects to be. For many years they have pushed a new WTO agreement as a way to raise the prices of agricultural products and in this way benefit producers in developing countries. After the sharp rise in food prices in the last year, proponents of a WTO argument began pushing the agreement as a way to lower prices.
This sort of massive inconsistency on one of the most fundamental goals of the agreement would have been worth discussing. It might have been appropriate to ask the experts about whether they agree with the old view of the expected outcome of a new WTO agreement or the new view.
--Dean Baker
COMMENTS (11)
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Posted by: esa | July 29, 2008 10:41 PM
Based on its actions (or lack), Bush administration prefers bilateral agreements.
In bilateral agreements, it is easier to make sweetheart deals for crony special interests.
Posted by: bakho | July 30, 2008 10:31 AM
Technical question for Dean or others: Is it possible that the lack of consensus on the effects of a successful negotiation is that Ricardo's Comparative Advantage Theorem is irrelevant because of the large flows of capital and labor across national borders?
Hence there is no overall theoretical guidance as to the effects of more "free trade"?
Posted by: Robert Hume | July 30, 2008 10:41 AM
Could you please address this issue a bit further? I live in Mexico and I know here the biggest problems are had by small farmers. Thus, big producers even in Mexico undermine the livelihoods of small farmers with many repercussions. Any solution?
Posted by: EK Buddenhagen | July 30, 2008 10:42 AM
Interesting points that are not commonly raised, when addressing WTO meetings. Unknown economists and experts have apparently the same status as government officials i.e. everything they say is news and does not need further research or comment.
Posted by: tjerk | July 30, 2008 10:54 AM
That's pretty much the way modern newpapery works, tjerk. Their motto is "They talk, we transcribe".
Posted by: QrazyQat | July 30, 2008 2:30 PM
But with government officials you have a better chance of figuring out who it is. For instance, a Western diplomat is the US Ambassador in the country in question, a Western European diplomat, the British ambassador, a European diplomat, the German ambassador.
They don't have similar codes for unnamed economists.
Posted by: PeonInChief | July 30, 2008 3:11 PM
>>Technical question for Dean or others: Is it possible that the lack of consensus on the effects of a successful negotiation is that Ricardo's Comparative Advantage Theorem is irrelevant because of the large flows of capital and labor across national borders?
Hence there is no overall theoretical guidance as to the effects of more "free trade"?
I have been thinking about this for a while too, Dean. Then again I haven't read Ricardo, perhaps that is part of what HIS concept of comparative advantage included. It is certainly not what the modern concept seems to be about. It seem to render the concept of "comparative advantage" to being almost tautological.
I really would love to hear your thoughts on this Dean!!
Posted by: Anonymous | July 30, 2008 7:56 PM
So, Dean you're saying that if the trade talks succeeded, then the developing countries selling their ag products at a profit that that price would exceed the price of subsidized pricing in a protectionist world. What kind of economic nonsense is that? You can raise the prices for the developing countries while also lowering the prices by removing the tariffs and subsidies in the developed countries.
Posted by: y21k | July 30, 2008 9:26 PM
Y21k,
the World Bank's analysis shows the world price of agricultural products rising because of the elimination of subsidies in the wealthy countries. That is a pretty standard economic prediction of economic theory (subsidies lower prices, removing them raises prices). It has only been in the last two years that proponents of the deal have turned out around and argued that a WTO agreement is essential to lower food prices.
Anonymous,
I don't think there is much dispute among serious economists about the likely short-term effect on prices (longer-term impacts on development are more questionable). I think it really is a case where proponents of the agreement are willing to pretty much just make things up to try to push their agenda. The opponents may be equally fast and loose with the facts, but the media will not simply accept the opponents' assertions as being true.
Posted by: Dean Baker | July 31, 2008 7:55 AM
"What's driving food prices?"
New report. A combination of several factors including dollar devaluation, oil prices and biofuels plus a host of other minor commodity specific factors are driving food prices. Export restrictions by some rice producers is given as a reason for a spike in rice prices.
The weak US dollar means that the US is paying more for commodities in many currencies, driving up prices. The global market in food is huge. At the grocery store, ask how much of what you buy is produced in the US. Grains and Meat- probably US. Fruit and veggies- much of it is imported.
http://www.farmfoundation.org/news/templates/template.aspx?articleid=404&zoneid=26
Posted by: bakho | July 31, 2008 9:00 AM