The ending of the trade policy bias against agriculture: Evidence for Indonesia and Thailand

In a famous multi-country study for the World Bank, Krueger, Schiff, and Valdés (1988) documented a consistent and widespread trade policy bias in developing countries. The bias operated against agriculture and in favour of manufacturing and this pattern was demonstrated throughout Africa, Latin America and Asia, including most countries of Southeast Asia. The data used in that study covered the period ending in the late 1970s. The present chapter asks whether that pattern can still be detected today, using updated information for two Southeast Asian countries – Indonesia, a major food importer, and Thailand, a major food exporter.