Most primary products are practically nontraded, usually due to very high transport costs, bulk and perishability. These commodities possess natural protection. Once processed, however, they become highly tradable. Analysis in this paper points to the result that these primary products share the protection enjoyed by tradable outputs. The proportion depends not only on the share of the primary products in the value of the processed products but on the elasticities of demand and supply of the primary and the processed products as well.
Derived Protection for Nontraded Primary Product
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