1、 1 外文翻译 原文 Material Source: Department of Agricultural and Resource Economics University of California Davis Author: Lovell S. Jarvis How Brazil Transferred Billions to Foreign Coffee Importers:The International Coffee Agreement, Rent Seeking and Export Tax Rebates Introduction. To raise the price o
2、f coffee, the International Coffee Agreement (ICA)imposed a global quota on the amount of coffee that producing countries could export duringmost of the period 1963-1989. Brazil, the world s largest coffee producer, received the largestshare of the quota. Although the quota may have increased the in
3、ternational price and thusimproved Brazil s gross terms of trade1, the quota also created large quota rents within Braziland these rents motivated considerable rent seeking activity. Much has been written about rentseeking, e.g., Krueger, 1973, but there are few detailed empirical studies because th
4、e effects ofrent seeking are often hard to document. Rent seeking in Brazil occurred in many of the traditional forms (Jarvis 2001). However,an exceptional, but previously unidentified example of how rent seeking affected the coffeesector involves Brazil s use of coffee export tax rebates. These reb
5、ates were introduced soonafter the ICA quota was implemented. The amount of these rebates was initially small,averaging $21million per year during 1965-69, but grew rapidly and reached a peak of nearly $2 billion in 1981. In total, between 1965 and 1989, Brazil emitted more than $8 billion in coffee
6、 export tax rebates, thereby reducing Brazil s net export taxes. The export tax rebates stimulated international demand for Brazilian coffee, causing the nominal price of Brazil s coffee to rise relative to those of its competitors. However, the net export price declined, causing Brazil to transfer
7、billions of dollars to foreign coffee importers and other rebate recipients.2 The latter effects appear to have been wholly unintended and were misunderstood aspects of the use of rebates. The rebates were initially justified as a means to price discriminate and increase Brazil s coffee revenues (De
8、lfim Netto and Andrade Pinto, 1965). Once this policy had come under fire, rebates were justified as necessary to maintain the 2 competitiveness of Brazilian coffee, given that Brazil required exporters to pay export taxes and turn over foreign exchange reserves based on a government-imposed Minimum
9、 Registration Price that sometimes exceeded the prices of Brazil s competitors (Bacha 1992). While the first justification for the rebates was theoretically plausible, the number of rebates issued quickly grew to exceed the amount that could have been economically justified as price discrimination,
10、given known parameters of the coffee market. The second justification was invalid since the Minimum Registration Price had little effect on the price at which coffee was actually sold. Brazilian coffee was fully competitive without the export tax rebates. The best explanation for the abundant emissi
11、on of export tax rebates is that they provided benefits to recipients, who engaged in rent-seeking activity to obtain more rebates. Export Tax Rebates. When Brazil first received an ICA country export quota in 1963, the IBC imposed a large export tax that restricted exports to less than them amount
12、of the quota that Brazil had been awarded. The IBC did so believing that Brazil had market power even within the quota amount (Bacha 1992). However, the IBC changed it policy in 1965 to ensure that it fulfilled its quota. It began to sign secret discriminatory contracts with a few large importers, p
13、aying them export tax rebates in exchange for their commitment to purchase a larger amount of coffee each year and to spread their purchases evenly throughout the year. The IBC argued that although world coffee demand was inelastic, the demand for coffee from individual countries (roasters) was high
14、ly price elastic, implying that Brazilian exports could be profitably increased via a price discount (Delfim Netto 1959, Delfim Netto and Pinto 1965). Internationally, the coffee importing and roasting industry was highly concentrated.6 Brazil therefore thought that it could “ exert its capacity to
15、discriminate among buyers according to their respective bargaining power” (Bacha, 1992). Because private firms handled all coffee exports, to achieve the desired price discrimination the IBC had to develop some mechanism like the export tax rebates. This mechanism had to ensure that any importer tha
16、t signed a long-term contract could purchase coffee from any exporter and pay only the agreed discounted price, while also ensuring that the exporter received the actual market price. The mechanism adopted was a negotiable, U.S. Dollarde nominated certificate called an Aviso de Garantia that was iss
17、ued by the IBC to a roaster on completion of a purchase. Importers could redeem the certificate when making their next purchase.8 3 Thus, assuming repeated purchases, the rebate reduced the net price of coffee to the purchaser, but not to the exporter or farmer. While the formulas that determined th
18、e specific export tax rebates to individual importers were secret, it is known that the magnitude of the rebates was tied to the difference between Brazil s export price and an average of its main competitors prices, as listed on the New York and London markets. The Use of Export Tax Rebates to Pric
19、e Discriminate. The hypothesis that the rapid rise in export tax rebates was a response to rent seeking can be tested using the model of price discrimination shown in Figure 2. Demand for Brazilian coffee is divided into two components, one from the largest foreign importers, DII, who are assumed to
20、 have purchased about 40% of Brazil s member market exports prior to initiation of the export tax rebates, and the other from all other exporters, DI. See Figure 2a. When the price is PA, total member market exports equal qI0 + qII0, which is assumed less than the Brazilian quota. Provision of a uni
21、t export tax rebate, , to the largest importers is assumed to expand sales to these importers from qII 0 to qII 1, and thus expand total member market exports by the same amount.9 For the scheme to work as intended, the (negotiated) demand of the largest importers had to be more price elastic than t
22、he demand of the other importers. For simplicity, the demand curve for other importers is assumed perfectly inelastic. The Effect of Export Tax Rebates on Brazil s Coffee Export Price. Because different policies were followed in different periods when export tax rebates were utilized, it seemed like
23、ly that the effect of the export tax rebates should have differed from one subperiod to another. I identified three subperiods for comparison: 1965-71, 1972-79, and 1980-88. During 1965-71, an export quota was in effect, the export tax was greater than the unit quota rent thus constraining exports t
24、o the quota market, and export tax rebates were paid to only a few large importers in exchange for an agreement by these importers to purchase additional coffee. Delfim Netto s theory assumed that the export tax rebate would reduce the constraining export tax, allowing a profitable export expansion
25、with no significant effect on the export price (See Figure 2). However, if the export tax rebate for the favored importers was set too high, it could have induced importers to increase purchasers of Brazilian coffee beyond the quota limit, causing an increase in the nominal export price. During 1980
26、-88, an export quota was in place, but the export tax was smaller than the unit quota rent and did not constrain exports to the member market. Export tax rebates were provided to “ all” importers of Brazilian coffee. Assuming that 4 the market was perfectly competitive, Brazil s nominal export price
27、 should have risen by the amount of the unit export tax rebate, leaving the net export price unchanged. For example, let there be an initial situation in which there is no export tax and no export tax rebate, where demand is set equal to a fixed supply (the export quota), i.e., D(p) = x - p = qA, wi
28、th - the slope of the demand curve. This yields the initial equilibrium price, p0 = (x - qA)/ . Then assume that an export tax rebate is paid to importers so that it appears as a net reduction in the export price (as the avisos were paid): D(p1 - ) = x - (p1- ) = qA. The new equilibrium price is p1=
29、 (x - qA)/ + , i.e., in a competitive market the payment of the aviso reduces the price of Brazilian coffee relative to that of other coffees and induces importers to increase the nominal amount paid for Brazilian coffee. Since the export price rises by the amount of the export tax rebate, the impor
30、ter enjoys no net gain and Brazil suffers no real loss. However, if the market is not perfectly competitive, importers may not bid up the nominal price by the full amount of the unit export tax rebate, in which case importers enjoy a net gain and Brazil suffer a net loss. During 1972-79, a somewhat
31、different situation held since no export quota was in effect. Brazil nonetheless imposed a substantial export tax. Since the export tax rebate was always paid to the importer following the purchase, the world market price remained the purchase price from the exporter s viewpoint. The domestic produc
32、er price was determined in keeping with the price received by the exporter, net of the gross coffee export tax. However, the foreign purchaser effectively paid a price net of the export tax rebate, with the cost of the rebate being paid from the Brazilian government s coffee export tax revenues. Imp
33、lementing an export tax rebate reduced the net export tax, should have led to an increase in exports and, as foreign importers moved down their demand curve, a slight decrease in Brazil s nominal export price.18 Without specific analysis, it is impossible to determine whether the coffee export tax w
34、as set at the economically optimal level, though casual analysis suggests that Brazil s coffee export tax was generally set too high as there has been a large erosion of its market share over time. Assuming that the export tax was too high, the use of the export tax rebate may have been welfare impr
35、oving. However, it would have been more efficient to simply reduce the export tax. Conclusions. The International Coffee Agreement (ICA) restricted world coffee exports from 1965 to 1989 in an effort to increase world coffee prices. The ICA imposed a global export quota that was divided among produc
36、ing countries, thereby 5 creating significant domestic rents. In Brazil, the largest exporting country, these rents led to significant rent seeking and, ultimately, to significant welfare loss. The greatest component of this loss was associated with the issue of export tax rebates that systematicall
37、y transferred income from Brazil to foreign importers, though this effect was never recognized. The Brazilian Coffee Institute (IBC) captured a significant fraction of the domestic coffee quota rent through imposition of an export tax. However, when the coffee export quota was implemented in 1965, B
38、razil was underselling its quota. As this situation suggested that the export tax was too high, Brazil decided to provide export tax rebates to qualifying purchasers of its coffee. These rebates were designed to achieve a “ price discriminating” reduction in the export tax paid by some importers, th
39、ereby increasing Brazil s exports and net export revenues. However, since the rebates conveyed substantial income to recipients, coffee importers avidly sought them. Brazilian policy makers/bureaucrats were apparently persuaded to issue growing amounts of rebates even after the export quota was fill
40、ed, presumably by rent seeking activity. There is also evidence of significant irregularities in the rebates use that seems to have benefited domestic exporters as well as some policy makers and/or bureaucrats (Jarvis 2001). I show econometrically that the export tax rebates stimulated foreign deman
41、d for Brazilian coffee, increasing its price relative to those of its competitors. However, Brazil s export price rose less than the amount of the export tax rebate so that the net price fell. This caused a large real transfer of domestic coffee quota rents to foreign importers and/or consumers. Ind
42、eed, as a result of the export tax rebates, foreign roasters may have gained more from the ICA quota than did Brazil. The ICA export quota created a market context within which the export tax rebates appeared attractive to Brazil, i.e., the export quota encouraged further government intervention in
43、the market and, though the rents created, provided the tax revenues that facilitated payment of the rebates. Nonetheless, it is surprising that Brazil used coffee export tax rebates to effectively transfer a large share of its domestic ICA quota rent to foreign roasters. The ICA was designed to incr
44、ease coffee export revenues for the benefit of coffee exporting countries, not foreign roasters, and foreign roasters had no political muscle in Brazil. Brazilians with whom I talked at the beginning of this study, both in the private and the public sector, consistently expressed a belief that forei
45、gn roasters had not received any transfer of rents. Certainly none of the Brazilians that I have talked with believed that such a 6 transfer was warranted. I conclude that had policy making been informed and rational from a national viewpoint, the use of rebates would have remained small and/or thei
46、r use would have quickly ceased. It is still somewhat unclear why Brazil initiated the use of coffee export tax rebates. Perhaps they were only intended as a mechanism to allow price discrimination, though Bates (personal communication) has suggested that the rebates were implemented to share the be
47、nefits of the ICA global quota with the large international coffee roasters in at least tacit exchange for their political support within the United States during the negotiation of the ICA (see also Bates 1997). Others, including Jorio Dauster, one of Brazils chief negotiators in the ICA in a later
48、 period, believe that the rebates were initiated only to achieve price discrimination (personal communication). It may be that the roasters perceived a benefit and supported the ICA at least partly on this basis, without Brazil having intended the benefit. Whatever the origin of the export tax rebat
49、e policy, the continuous and expanded use of the rebates over a long period, despite reducing net IBC revenue and worsening Brazil s net terms of trade, points to the insidious nature of rent seeking. Any transfer was strikingly at odds with the Brazilian government s often stated objective that it wanted to use the IBC to offset the roasters perceived market power and thus achieve better prices and higher revenues from coffee. It appears likely that relatively small gains to a few officials encouraged the continuation a
