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Estimates of Distortions to Agricultural Incentives, 1955-2011 (updated June 2013)

Authors:Kym Anderson  and Ernesto Valenzuela
Web Address:World Bank Agricultural Distortions website
Topics:Trade
Report Number:WPS4612, WPS4864
Citation: 

Kym Anderson and Ernesto Valenzuela, "Estimates of Global Distortions to Agricultural Incentives, 1955 to 2007", World Bank, Washington D.C., October 2008. (Available at www.worldbank.org/agdistortions website)

Kym Anderson and Signe Nelgen, "Updated National and Global Estimates of Distortions to Agricultural Incentives, 1955 to 2011", Washington, D.C., June 2013. (Available at www.worldbank.org/agdistortions website)


Report-Builder Interface for the Agricultural Distortions data to 2007 is available at the Centre for International Economic Studies, University of Adelaide, Australia. Feedback on both the core database and the report builder should be directed to ernesto.valenzuela@monash.edu


The World Bank’s research project on “Distortions to Agricultural Incentives” has produced a core database of Nominal Rates of Assistance to producers, or NRAs, together with a set of Consumer Tax Equivalents, or CTEs, for farm products and a set of Relative Rates of Assistance to farmers in 75 focus countries (since expanded to 82, listed here). This page provides details of that core database. Since its NRAs and CTEs are the key source for a supplementary database of partial equilibrium indicators of trade and welfare reductions due to government interventions in agricultural markets, this page also provides details of that supplementary database, which can be accessed by clicking here.

The vast majority of the world’s poorest households depend on farming for their livelihood. In the past their earnings were often depressed by pro-urban and anti-agricultural biases of their own country’s policies. While progress has been made over the past two decades by numerous developing countries in reducing those policy biases, many trade-reducing price distortions remain intersectorally as well as within the agricultural sector of low-, middle- and high-income countries.

This project, in seeking to understand the extent, effects of and reasons behind that transformation, began by compiling new estimates of price distortions over the past half century. National country studies were undertaken in more than 50 countries in Africa, Asia, Latin America, and Europe’s transition economies. They were supplemented with similar estimates and analytical narratives of policy trends in 20 high-income countries. Together those countries account for more than 90 percent of the value of global agricultural output. Working Paper versions of the national studies, and the associated national spreadsheets that were drawn on to generate the core global dataset, can be assessed by clicking here.

The core database provides nominal rates of assistance estimates for the main individual commodities that together account for about 70 percent of the value of farm production in those countries, as well as guesstimates of the NRA for the 30 percent of farm production not covered. Also estimated is the NRA for non-agricultural tradables so as to compute a relative rate of assistance. Consumer tax equivalents are also provided for the covered products in each focus country, along with value of production and consumption at undistorted prices and of trade for each covered product and for non-covered farm products. The working paper #wps4612, listed above, serves as the "methodology paper" for this first database.

The core database files contain, among others, the following variables for each focus country or for regional aggregates of focus countries:

  • Nominal rates of assistance (NRA), by individual covered farm product and by policy instrument
  • Nominal rate of assistance for all agricultural tradables (incl. non-covered products)
  • Nominal rate of assistance for all non-agricultural tradables
  • Relative rate of assistance (RRA)
  • Consumer tax equivalent (CTE), by individual covered farm product
  • Official foreign exchange rate
  • Equilibrium exchange rate used in NRA calculations
  • Volume of production, by individual covered farm product
  • Domestic producer farmgate price, by individual covered farm product
  • Value of production at undistorted prices for each covered farm product
  • Value of consumption at undistorted prices for each covered farm product
  • Share of production exported, share of consumption imported, and self-sufficiency ratio, by individual covered farm product
  • Population, total and rural
  • Employment, total and agricultural
  • GDP per capita, in constant year 2000 US$
  • Gross subsidy equivalent to farmers, in constant year 2000 US$

The supplementary database on trade and welfare reduction indexes provides estimates of welfare and trade reduction indexes for each of the 75 countries (since expanded to 82, listed here). The working paper #wps4864, listed above, serves as the "methodology paper" for this second database. That supplementary database, which can be accessed by clicking here, contains the following variables for each focus country or for regional aggregates of focus countries:

  • Trade reduction indexes (TRI) by country, all covered tradable products and some subsets
  • Welfare reduction indexes (WRI) by country, all covered tradable products and some subsets
  • Commodity contributions to the country-specific WRI
  • Commodity-specific global trade reduction indexes
  • Commodity-specific global welfare reduction indexes
  • Country contributions to the commodity-specific TRI
  • Country contributions to the commodity-specific WRI
  • Value of production at undistorted prices for each covered product and country
  • Value of consumption at undistorted prices for each covered product and country

Note:  Both the core and supplementary databases to 2007 have been updated to 2011 (or to 2010 in some developing countries).  Another seven countries have been added as well, namely Belgium, Cyprus, Greece, Israel, Luxembourg, Malta, and Morocco, to make a total of 82 countries, and the Kazakhstan data have been extended back to 1995.  The full list can be assessed by clicking here.

Access to Dataset

Note summarizing core database coverage

Core database 

Supplemental database on trade and welfare reduction indices 

Regional and global aggregates from the database




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