Better Agri-food Trade Modelling for Policy Analysis

Economy-wide assessments of regional trade agreements often fall short of capturing the complexity of agri-food trade policies especially in the case of major structural changes (as market concentration and global value chain issues). “New generation” trade agreements include many aspects beyond traditional trade policies. Consumer concerns are increasing about food quality and safety, environmental implications, as well as ethical concerns about the way food is produced and its impact on poverty, job destruction and increasing inequality. BATModel will advance assessments of agri-food trade policies as follows: (1) by improving the theoretical underpinning and methodologies of partial and general equilibrium models in ex-ante trade assessments; (2) based on micro-level evidence, by improving our understanding and modelling of value chain to enable more precise impact assessments (gains and losses, between and within member states, between and within groups of agents); and (3) by integrating econometric estimations into existing simulation models at micro- and macro-level, which will allow the analysis of extended welfare effects, like inclusiveness and sustainable development goals. The core contribution will be the BATModel Modular Platform for agri-food trade modelling that will equip the analytical tools, in particular the simulation models currently used by the European Commission (EC), for the analysis of 21st-century agri-food trade issues. BATModel will provide a new modular generation of trade models to support the EC, policy-makers and other stakeholders to better account for specific issues such as non-tariff measures, geographical indications, zero trade flows, quality differentiation and global value chains. The BATModel Modular Platform will ensure long-term impact of the project. The dedicated BATModel Dissemination and Stakeholder Platform will ensure close interactions with stakeholders to provide and disseminate relevant trade policy analyses.