Lithuanian Agriculture and the World Market: Policy Options and Implications and Modeling Agricultural Markets for Policy Trade Analysis in Lithuania

Abstract

<p>The two related papers in this report were prepared for two conferences in Estonia in May 1993. The first paper (Saku) discusses alternative policy directions for Lithuanian agriculture and provides a qualitative assessment of these options. The second paper (Tartu) uses a simulation model for Lithuanian agricultural markets to analyze the impacts of three policy scenarios. The reference or baseline scenario assumes that real prices will increase at a specified rate. This forms the basis for comparison of two other scenarios. One assumes that domestic prices reach world market parity prices by 1995, allowing only for a quality discount of 15 percent for meat products. The other scenario assumes the extreme self-sufficiency case, where all imports and exports are zero and prices are solved for equilibrium levels.</p>