General Agreement on Tariffs and Trade:
Agriculture Department's Projected Benefits Are Subject to Some Uncertainty
GGD/RCED-94-272: Published: Jul 22, 1994. Publicly Released: Jul 22, 1994.
- Full Report:
Pursuant to a congressional request, GAO reviewed the Department of Agriculture's (USDA) report on the impact of the Final Act of the Uruguay Round of trade negotiations on U.S. agriculture, focusing on the: (1) report's analytical framework; and (2) assumptions USDA used in preparing the report.
GAO found that: (1) although USDA used a reasonable analytical framework to determine the economic impact of the act on U.S. agriculture, the report's predictions must be interpreted with caution because of the inherent uncertainty in the assumptions USDA used; (2) the least certain assumptions include the projections of economic growth resulting from the Final Act, foreign governments' implementation of the Final Act, and how agricultural producers worldwide will respond to expected changes in agricultural policies; (3) it is difficult to measure the economic gains and future trade flows on which an increase in world income is predicated; (4) USDA could not incorporate every potential policy change in its assumptions; and (5) agricultural producers operate within a complex set of internal and external policies that are subject to change.