An Economic Risk Assessment of the Impact on Producers of Removing Quarantine Restrictions

Abstract

This paper contributes to the understanding of the impact of removing quarantine restrictions on the income risk of domestic producers. It develops a model of this impact on a producer's perception of income risk. Four effects of the introduction of imports on the perceived income risk of domestic producers are identified, as well as a range of factors which influence the magnitude of these effects. A numerical analysis evaluates the role of each of these factors in determining the producer's perception of income risk following the introduction of imports. This evaluation provides a range of conclusions relevant to quarantine policy.