Developing Country Aspects To Trade Policy Analysis: Does One Size Fit All? Paper prepared for the conference "WTO: Competing Policy Issues and Agendas for Agricultural Trade

Geography, international trade and institutions are often cited as reasons for the disparity in income among nations. The paper reviews these arguments and focuses on the interdependence between insti-tutional reform and foreign trade. Countries must export to import, and integrating an economy into world markets induces institutional change, which facilitates increased rates of economic growth. It is shown that agricultural policies in advanced countries are a barrier to agricultural exports from developing countries. If these barriers, as the literature suggests, are also barriers to institutional reform in poor countries, then the typically measured gains to trade reform by advanced countries are greatly underestimated, i.e, one measure (size) does not fit all. An analysis of growth in factor productivity linked to institutional reform in sub-Saharan Africa is shown to increase tran-sition and long-run growth substantially