Role of Comparative Advantage in Biofuel Policy Adoption in Latin America

The primary objective of this study is to evaluate whether renewable energy initiatives recently developed and implemented in Latin American and Caribbean countries are consistent with their national resource endowments, policy goals, and the general postulates of economic theory. Most classical and neoclassical theories suggest that international trade enhances economic efficiency and welfare of both parties involved in the exchange when they focus on producing and distributing products and services in which they have a comparative advantage. To achieve this goal, we analyze ethanol policy drivers using panel data from four major economies—Argentina, Brazil, Colombia, and Mexico. Since there is no universally accepted measure of comparative advantage, three separate models with different indicators—relative feedstock price, comparative export performance, and revealed comparative advantage—along with control variables, including the availability of production resources such as land and farm labor, are estimated. As expected, results show that the comparative advantage in feedstock production was one of the crucial factors in determining biofuel policy development and implementation in the four countries.

An Information Approach to the Impact of Ethanol Policy on Regional Changes in Corn Production

This paper examines the regional changes of corn production and the relationship between ethanol production and corn production. The underlying hypothesis is that the rapid growth in ethanol production causes regional expansion of corn production outside the traditional regions. This paper introduces the information approach developed by entropy theory to describe these regional changes. The results support the hypothesis that ethanol production leads to expansion of corn production outside traditional corn producing regions.

Policy Analysis in Welfare and Policy Spaces: Applications to the Labyrinthine U.S. Ethanol Policy Literature

We discuss the analysis of policy in three “spaces”: the customary (