| The Andean Community's Price Band System (APBS), introduced in 1995, had the announced goal of reducing domestic price instability by buffering fluctuations in international prices through use of a variable import tariff. This paper evaluates the effects of the Andean Price Band System on domestic producer price variability, levels of nominal protection and changes in producer welfare. Application is made to four important food products - maize, rice, sugar and milk - in Colombia, Ecuador and Venezuela, from the period 1990 to 1998. The effects of the APBS on producer price variability are analyzed through 1) comparing coefficients of variation of detrended, monthly deseasonalized real prices before and after the harmonization of the APBS in 1995, and 2)... |
