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GTAP Resource #1712

"Impact of Switching Production to Bioenergy Crops: The Switchgrass Example"
by McDonald, Scott, Sherman Robinson and Karen Thierfelder

This paper reports the results of a series of simulations that evaluate the general equilibrium effects of substituting crude oil by biomass, specifically switchgrass, in the production of petroleum in the USA. The simulations are inspired by debates over the implications for developing countries if agricultural policies in the USA are changed so that agricultural land is transferred from the production of cereals and other crops to biomass production. The results confirm expectations that such a policy shift would raise cereal and other agricultural prices, due to a general reduction in food production in the USA. However, the reduction in the demand for crude oil in the USA causes terms of trade effects that more than offset any potential benefits for developing countries, causing a general decline in economic welfare. Moreover, the declines in welfare are proportionately greater for developing countries due to their small levels of production of the commodities whose prices increase with the change in USA agricultural production.

Resource Details (Export Citation) GTAP Keywords
Category: GTAP Application
2005 Conference Paper
Status: Published
By/In: Presented at the 8th Annual Conference on Global Economic Analysis, Lübeck, Germany
Date: 2005
Created: Thierfelder, K. (4/29/2005)
Updated: Batta, G. (6/21/2005)
Visits: 2,394
No keywords have been specified.

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