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The expansion of international trade, according to the traditional trade theory, can be the escape passage from economic stagnation. Furthermore, it will result in specialization within a country and increasing efficiency of production and real income. The concept and measurement of economic growth are explored. Also the importance of international trade for a small nation is studied. The author traced the structure and trends of world trade, which are contributed to economic growth in the past. Then studied the structure and pattern of international trade of Thailand. The growth in Thailand's participation in world trade is significant, but the rate of growth in production and income are among the low level. In recent years, the government of Thailand introduced the economic development plan with a basic aim to stimulate economic growth and to raise the income per capita among its people. The findings agree with Prebisch proposal that the growth in underdeveloped countries must be promoted by domestic industrialization. And the application of traditional trade theory into the underdeveloped countries and into the world of today is questionable.

Sugar has a long history of being a contentious commodity important in international trade. Initially, the global framework for sugar trade was based on sugarcane, a grass grown in the tropics with trade being dictated largely by the British. In the Napoleonic wars, commercialization of the beet sugar industry arose on the continent in response to and a direct challenge to British control over the industry. The advent of the temperate sugar beet as an alternative to tropical cane in sugar production opened up a north-south trading dynamic that exists to this day. The United States, although a late entry into sugar production, is now at the forefront of the debate on trade liberalization for sugar, which can be produced more economically and out of greater necessity in a battery of nations, many with developing economies. Between 2003 and 2007, the United States ranked 5th in production, averaging 5% of the world total, and 2nd in total imports averaging 4%. Sugar as a percentage of the total value of the crop in the US is relatively minor at roughly 2.5% of the total putting it well below crops like corn and cotton, on par with tobacco and rice and greater than peanuts. Currently, the US sugar program operates on a price support system which regulates imports from other countries and provides a price floor for sugar. However, the US Sugar sector is under pressure for reform both by other nations with a comparative advantage in sugar production and from within due to an impending NAFTA commitment that allows for free trade with Mexico in sugar beginning in 2008. With large amounts of Mexican sugar entering the United States, the market price will likely fall below the price floor established by the USDA and there will be large amounts of forfeitures to the Commodity Credit Corporation. This would be in direct violation of the government mandate to keep the US sugar program operating at no government cost. In this thesis, we lay out a matrix of possible alternative policy scenarios and potential exogenous shocks which could impact the US sugar sector. Using the USDA ERS Sugar and Sweeteners model, we illustrate the outcome of this matrix of policies and exogenous shocks to the biggest players in the North American sugar sector. Policies used in the model draw inspiration from the recent reforms to the sugar sector in the European Union and recent commodity program reforms in the US for peanuts and tobacco. Finally, the implications of various policy reform options are discussed in light of their ambition and likelihood. / Master of Science

This dissertation describes two essays in empirical international trade, focusing on trade costs and the pattern of trade along the intensive and extensive margins. In the first essay, I study the barriers that impede international trade. In the second paper, I examine the growth of U.S. agricultural trade in detail describing how U.S. agriculture and food trade has expanded along the margins. The first chapter introduces a relatively straightforward, yet empirically powerful, manipulation of the gravity equation. The gravity model has been dubbed the work horse model of empirical trade, and thus is a suitable foundation from which to derive an indirect measure of largely unobservable 'iceberg' trade costs. In this paper, I solve a sector level version of the gravity equation and study the pattern of agricultural trade costs and factors that impede world agricultural trade growth over a long time series, 1986-2011. In addition, I estimate sector-specific elasticity of substitution which is a key parameter in the computation of trade cost. In the second essay, I examine the growth of world and U.S. agricultural exports along the intensive and extensive margins of international trade over the period 1986 to 2010. The purpose of this essay is to decompose the growth of world and U.S. agricultural trade using qualitative methods from the marketing literature (i.e., market expansion grids) but modified to fit bilateral trade relationships and a theoretical index to measure the margins of trade at a single point in time. In addition, we examine often overlooked channels by which U.S. agricultural exports have expanded using very detailed agricultural product lines. Using information related to the pattern of a trade rather than trade volume itself, I estimate how much starting a trade relationship with a new partner or in a new product variety matters to agricultural trade growth and then conclude with a set of stylized facts to inform current theory. / Ph. D.

Limao and Panagariya (L&P, 2007) modify Grossman and Helpman’s (1994) lobbying model in an attempt to understand why anti-trade bias is the predominant pattern in observed trade policy. L&P (2007) propose that governments seek to reduce inequality between sectors by modifying trade policies in a way that reallocates income from the smaller to the larger sector. We assess the empirical validity of L&P’s (2007) theory by exploiting the World Bank Distortions to Agricultural Incentives database (Anderson and Valenzuela, 2008), using their measure of trade bias as our dependent variable. We find little empirical support for L&P’s (2007) theory, and estimated coefficients on most control variables are insignificant. Lagged trade policies are significant determinants of current trade policy, suggesting the presence of policy persistence. We conclude that it is difficult to generalise L&P’s (2007) theory across a wide and unbalanced panel of countries that extends from the 1950s to the 2000s.

The Canadian government has been holding an inconsistent position in the agricultural trade negotiations of both the Uruguay and Doha rounds. It has been advocating for freer agricultural trade while defending its supply management system, a protectionist policy that governs dairy, poultry and eggs in the country. The thesis attempts to answer the question: What domestic factors explain the inconsistent position, advocating for both liberalization and protectionism, that Canada has been advocating in the Uruguay and Doha rounds of negotiations on agriculture since 1985? The thesis starts with the assumption that the Canadian government has had a preference for free trade and market-based economic policies since the 1980s. The question is therefore less about explaining Canada???s dual position, but rather about explaining why Canada continues to defend supply management, a system that appears to be in contradiction with its policy preferences. The thesis explores two arguments. First, it analyses the lobbying power of the farmers??? organizations from the supply-managed sectors and from the export-dependent sectors. Second, the thesis evaluates the impact of the concentration of supply-managed farms in Quebec and Ontario. It looks at the effect of support by these two provincial governments, at electoral motivations behind the maintenance of supply management as well as at Quebec separatism and nationalism. Finally, the thesis presents the importance of corporatism in the continued governmental support to supply management.

Limao and Panagariya (L&P, 2007) modify Grossman and Helpman’s (1994) lobbying model in an attempt to understand why anti-trade bias is the predominant pattern in observed trade policy. L&P (2007) propose that governments seek to reduce inequality between sectors by modifying trade policies in a way that reallocates income from the smaller to the larger sector. We assess the empirical validity of L&P’s (2007) theory by exploiting the World Bank Distortions to Agricultural Incentives database (Anderson and Valenzuela, 2008), using their measure of trade bias as our dependent variable. We find little empirical support for L&P’s (2007) theory, and estimated coefficients on most control variables are insignificant. Lagged trade policies are significant determinants of current trade policy, suggesting the presence of policy persistence. We conclude that it is difficult to generalise L&P’s (2007) theory across a wide and unbalanced panel of countries that extends from the 1950s to the 2000s.

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There are a variety of international issues that disrupt the global trade market, an important one being national policies on the regulation of genetically modified organisms, or GMOs. Many crops have been genetically modified for reasons from herbicide resistance to correcting dietary shortfalls. This study evaluates the United States' exports of corn and soybeans from 1998 to 2016 to identify unusual shocks in trade values. In particular, this study quantifies how the importers' policy stance on the GMO issue impacts bilateral trade values. I estimate a gravity model with both ordinary least squares (OLS) and Poisson pseudo maximum likelihood (PPML) estimations. Residual analysis is used to assess the difference between actual trade and the trade levels predicted by the models. The results suggest that anti-GMO policies reduce trade values by an average of 11%. The largest difference between predictions and actual trade values is seen in corn exports to the European Union. Between 1998 and 2016, this forgone trade in corn was valued at $52.7 billion, which is $2.77 billion per year on average. This value is similar to the annual average value of U.S. exports of corn to Japan in the same period, $2.46 billion. The results have important implications for the agricultural industry. For developing nations, adoption of GMO crops could increase productivity and help alleviate poverty. Ultimately, the decision to adopt is up to the consumer, so the factors of consumer knowledge and opinions of GMOs are not to be ignored. / Master of Science / There are a variety of international issues that disrupt the global trade market, an important one being national policies on the regulation of genetically modified organisms, or GMOs. This study evaluates the United States’ exports of corn and soybeans from 1998 to 2016 to identify unusual drops in trade values. In particular, this study quantifies how the importers’ policy stance on the GMO issue impacts bilateral trade values. I estimate a gravity model with various estimation methods. Residual analysis is used to assess the difference between actual trade and the trade levels predicted by the models. The results suggest that anti-GMO policies reduce trade values by an average of 11%. The largest difference between predictions and actual trade values is seen in corn exports to the European Union. Between 1998 and 2016, this forgone trade in corn was valued at $52.7 billion, which is $2.77 billion per year on average. This value is similar to the annual average value of U.S. exports of corn to Japan in the same period, $2.46 billion. The results have important implications for the agricultural industry. For developing nations, adoption of GMO crops could increase productivity and help alleviate poverty. Ultimately, the decision to adopt is up to the consumer, so the factors of consumer knowledge and opinions of GMOs are not to be ignored.