Export taxes, food prices and poverty: a global CGE evaluation

Export restrictions, such as export taxes, have increased over the last ten years. In addition, export taxes often occur when food prices are high and/or volatile. As such, export taxes have received a lot of attention in the literature, but these studies tend to examine only a single commodity or country. This study seeks to provide more detail into the linkages among export taxes, trade, food prices, and poverty by utilizing a global economic model with detail on export tax occurrence in agriculture. Results show that export taxes do not have a widespread impact on international agricultural prices, but rather that the impact is concentrated in few goods: wheat, coarse grains, and beef. Removing export taxes would benefit regions currently applying taxes through an increase in production and exports and a reduction in poverty. In other regions, which are major agricultural exporters, an increase in competition of exports in international markets could lead to a fall in domestic prices. Our analysis does not find a significant impact of export tax removal on poverty, except among some export tax imposing countries for which poverty falls as a consequence of the removal of export taxes. These results highlight the need to consider the general equilibrium effects of the removal of export taxes.