Sugar Policies: An Invincible Bastion for Modelers?

This paper uses the EU sugar market regime as an example. Accordingly, the second chapter briefly describes the EU sugar market regime. The theoretical part of the paper (Chapter 3) then surveys the literature to document the approaches applied to model sugar policies in partial and general equilibrium models. In the second part of Chapter 3, the Global Trade Analysis Project (GTAP) model is utilized to exemplify different options to implement production quotas. In Chapter 4, the extended GTAP model structure and the GTAP data base (Version 6) are used to simulate the WTO negotiations (e.g., the Harbinson proposal). Thereby, the impact of alternative sugar quota modeling options on model results is identified. Chapter 5 concludes the paper with a summary of the qualifications and the main findings.