explaining agricultural productivity growth an international perspective this article presents multi output multi input total factor productivity tfp growth rates in agriculture for 88 countries over the 1970 2001 period estimated with both stochastic frontier analysis sfa and the more commonly employed data envelopment analysis dea we find results with sfa to be more plausible than with dea and use them to analyze trends across countries and the determinants of tfp growth in developing countries the central finding is that policy and institutional variables including public agricultural expenditure and proagricultural price policy reforms are significant correlates of tfp growth the most significant geographic correlate of tfp growth is distance to the nearest oecd country

a revealed preference test of rationing abstract this paper derives a revealed preference test for utility maximization under rationing and can detect for which goods rationing is binding without specifying a functional form or imposing rationing constraints prior to estimation for uk data from 1920 55 we find evidence of utility maximization under rationing with rationing binding for food and other services estimated virtual prices exceed observed food prices by 16 5 in 1947 and observed prices of other services by 10 9 in 1952

on the transmission of world agricultural prices two questions are asked about the relationship between domestic prices and world prices of agricultural commodities are variations in world prices transmitted to domestic prices domestic prices are regressed on world prices in various forms taking into account the possible effects of exchange rates and inflation the empirical analysis is based on data from the food and agriculture organization of the united nations for 58 countries from 1968 78 and for the countries of the european community from 1961 85 the results show that most of the variations in world prices are transmitted and that they constitute the dominant component in the variations of domestic prices

promotion of the agricultural sector and political power in austria in most industrialized countries farmers as a small and well orgnized group are ableto influence government decisions to get rent creating proposals enacted two different viewsare presented to explain why the chicagoan view efficient redistribution hypothesis and the virginian view inefficient outcome of political bargaining a vertically structuredempirical model of the austrian farm sector is employed to test both hypotheses quantitativeresults of the welfare transfers from consumers taxpayers to farmers and agribusiness firmsare derived and the political weights of these groups are presented

long term drivers of global virtual water trade a trade gravity approach for 1965 2010 abstract in the era of globalisation over the last half century there has been an increase in the exchange of agricultural and food products this internationalisation process has led to intense environmental pressures on a global level which has been the case of water resources this paper studies the determinants of global virtual water trade flows between 1965 and 2010 using panel data techniques we have evaluated and quantified the explanatory factors of bilateral virtual water transfers between 70 countries as a result of agri food trade we have used the well known trade gravity equation to explain exchanges of water embodied in agricultural goods on the basis of economic geographical institutional and environmental factors the analysis considers economic country heterogeneity in order to evaluate how trade impacts water resources depending on different development patterns our main findings indicate that the traditional economic institutional and geographic factors played a key role as drivers of virtual water bilateral trade flows between 1965 and 2010 in addition the natural endowments also exerted a notable influence on these trends

the political economy of regulations and trade wine trade 1860 1970 dramatic changes in the 1860 1970 wine trade provide insights on the political economy of regulations and policy instrument choice and trade an invasion of phylloxera in the 1870s turned france from the world s leading exporter to a massive importer of wine and grapes when french production recovered a combination of tariffs safety regulations and quality standards were introduced to protect its french producers causing dramatic changes in global wine and grape production and trade including in spain italy turkey greece algeria tunisia and morocco changes in wine regulations were caused by relative income and loss aversion factors in political economy tariffs were the preferred policy instruments as they directly restrict imports bring in revenues have low transaction costs and are preferred political instruments when there are information imperfections safety regulations and quality standards including labelling and input prohibitions reduce asymmetric information for consumers or undesirable externalities and simultaneously protected domestic producers regulations were often targeted at imported products wine and raisins when tariffs were ineffective or constrained by institutions such as on colonial wine hence tariffs and quality regulations were jointly used in wine policy both as complements and as substitutes in policy design

political economy of public policies insights from distortions to agricultural and food markets the agricultural and food sector is an ideal case for investigating the political economy of public policies many of the policy developments in this sector since the 1950s have been sudden and transformational while others have been gradual but persistent this paper reviews and synthesizes the literature on trends and fluctuations in market distortions and the political economy explanations that have been advanced based on a rich global data set covering a half century of evidence on commodities countries and policy instruments the paper identifies hypotheses that have been explored in the literature on the extent of market distortions and the conditions under which reform may be feasible

black hole tariffs and endogenous policy theory political economy in general equilibrium preface acknowledgments list of results 1 a preview of the results 2 endogenous policy theory a diagrammatic approach part i endogenous policy theory with specific factors the theory of industry tariffs in partial equilibrium 3 the probabilistic voting model of political efficiency and powerless politicians 4 endogenous lobbying theory and the contribution specialization theorem 5 endogenous tariff theory 6 the power function model of endogenous industry lobbying 7 three simple tests of the stolper samuelson theorem 8 the invisible foot and the waste of nations lawyers as negative externalities part ii endogenous policy theory in general equilibrium a long run theory of national tariff levels 9 the 2 x 2 x 2 x 2 model of endogenous redistribution theory 10 a prisoner s dilemma theory of endogenous protection the leontief model 11 the compensation effect and the multiple equilibrium trap 12 increasing returns to politics and factor endowments economic development and brazilian vitality versus the indian disease 13 endogenous protection in the united states 1900 88 14 a cobb douglas model 15 black hole tariffs 16 the endowment effect cross national evidence on endogenous tariffs part ii postscript 17 the senile industry argument for protection 18 optimal obfuscation and the theory of the second worst the politically efficient policy mathematical appendices references author index subject index

great expectations the subjective well being of rural urban migrants in china summary this paper is among the first to link the literatures on migration and on subjective well being in developing countries it poses the question why do rural urban migrant households settled in urban china have an average happiness score lower than rural households three basic hypotheses are examined migrants had false expectations about their future urban conditions or about their future urban aspirations or about their future selves estimated happiness functions and decomposition analyses based on a 2002 national household survey indicate that certain features of migrant conditions make for unhappiness and that their high aspirations in relation to achievement influenced by their new reference groups also make for unhappiness although the possibility of selection bias among migrants cannot be ruled out it is apparently difficult for migrants to form unbiased expectations about life in a new and different world

the development of agricultural policies in central and eastern europe abstract agricultural and food subsidies and fixed prices imposed by the old central command system have been abolished recently throughout central and eastern europe cee however protectionist government regulations have been reintroduced this viewpoint argues that these policy changes are consistent with the results from the literature on new political economy or endogenous policy theory moreover as privatization of farms continues and the non agricultural sectors of the economy start growing this theory predicts that protectionist policies will increase in the agricultural sector in central and eastern europe in addition agricultural protectionism in western countries stimulates the increase in cee agricultural protectionism

economic development institutional change and the political economy of agricultural protection an econometric study of belgium since the 19th century this empirical study uses 100 years of annual data on 11 agricultural commodities from belgium to measure the impact of structural changes coinciding with economic development and changes in political institutions on agricultural protection the analysis shows that changes in agricultural protection are caused by a combination of factors governments have increased protection and support to farmers when world market prices for their commodities fell and vice versa offsetting market effects on producer incomes other economic determinants were the share of the commodities in total consumer expenditures negative effect and in total output of the economy positive effect with belgium a small economy there was no impact of the trade position changes in political institutions have affected agricultural protection democratic reforms which induced a significant shift in the political balance towards agricultural interests such as the introduction of the one man one vote system led to an increase in agricultural protection the integration of belgian agricultural policies in the common agricultural policy in 1968 coincided with an increase in protection ceteris paribus both institutional factors related to changes in access to and information about the decision making at the eu level and structural changes in the agricultural and food economy may explain this effect

the household responsibility system in china s agricultural reform a theoretical and empirical study the emergence and eventual prevalence of the household responsibility system which replaces the production team system as the unit of production and income distribution has brought about dramatic changes in china s rural areas since 1979 this institutional change has resulted in remarkable growth in agricultural productivity however in the literature on collective farms a theory that is capable of explaining the causes and effects of this change is yet to be developed the formal theory about collective economies developed so far by ward domar sen oi and clayton bradley maurice and ferguson cameron bonin chinn israelsen putterman and others suggests that the allocation of resources in a collective farm is efficient at least in

who are the producers and consumers value chains and food policy effects in the wheat sector in pakistan we develop a disaggregated nominal rate of assistance nra methodology to disentangle the welfare impacts of policies for various interest groups along the value chain to disaggregate effects within the producer and consumer umbrellas we apply our value chain nra methodology to the case of pakistan s wheat price and trade policy we analyze the welfare implications for various agents in the wheat flour value chain from 2000 to 2013 a period characterized by major global price volatility and by regular adjustments of domestic policies we find that the wheat policy has generally benefitted flour consumers and wheat traders at the expense of wheat farmers with limited effects on flour millers our findings illustrate that the welfare implications of policies can be quite different within the producer and consumer umbrellas which has potentially important implications for economic and political economy analyses and for the design of policies that aim to target the poorest groups along value chains

implications of domestic price insulation for global food price behavior abstract rapid changes in global food prices in recent years are widely viewed as a serious threat to global development while various sources of price instability in agriculture have been identified little attention appears to have been given to the importance of changes in trade policies that insulate domestic prices from world markets as a source of volatility in world prices a contribution of this paper is to show that these interventions are dynamically more complex than simple proportional insulation insulation against an initial price increase in world prices increases the magnitude of that increase while subsequent adjustments to the level of protection change the fundamental nature of price volatility we find such policies are widespread and increase the volatility of world prices while not reducing the volatility of domestic prices because of the collective action problem involved in this form of policy intervention

a sectoral accounting approach to national savings applied to korea abstract this paper presents a sectoral accounting approach to the determination of the national savings ratio starting with the process of sectoral savings determination and showing the sectoral interactions this approach offers an acceptable empirical framework for aggregate savings studies the model estimated with the korean data is used to run simulations to evaluate its predictive capacity to decompose past savings performance by major factors and to assess the savings effect of policy changes and other exogenous shocks the results indicate that income variables have been the most important determinants although interest rate and tax policies have also played some role

food security policy options for china lessons from other countries the authors gratefully acknowledge financial support from the world bank and australia s rural industries research and development corporation

determinants of private savings behaviour in turkey this study investigates the effects on private saving rates of a number of policy and non policy variables the analysis covers the period 1968 1994 the empirical private saving model for turkey is estimated the findings support the hypothesis that private saving rates have strong inertia the evidence indicates that government saving does not tend to crowd out private savings and the ricardian equivalence does not hold strictly income level has a positive impact on private saving rate and growth rate of income is not statistically significant from a policy point of view financial depth and development measures in turkey suggest that countries with deeper financial systems tend to have higher private saving rates private credit and real interest rates try to capture the severity of the borrowing constraints and the degree of financial repression for turkey moreover the negative impact of life expectancy rate lends support to the life cycle hypothesis the precautionary motive for saving is suppor

policies and institutions in transition economies a political economy perspective on the agri food sector abstract this paper argues that since democratic governments are vulnerable to political pressure they should intervene with policies and institutions only when the net economic benefits exceed the costs incurred through increased political access if governments in transition economies are to exercise control it is important that public institutions within and supporting the agri food sector are designed in such a way as to restrain political incentives in practice this means that they should be built so as to take advantage of inherent scale economies

a general equilibrium perspective on structural change in the rural economy a research study explored innovative methods for constructing computable general equilibrium cge models for rural structural change and development policy analysis these are the make matrix the personal consumption goods industrial goods matrix the occupation industry matrix and the map distance matrix modeling the cge for rural areas requires particular attention to the results of econometric tests on economics theories especially since rural communities are demographically and economically different from urban regions

food prices wages and welfare in rural india this paper considers the welfare and distributional consequences of higher relative food prices in rural india through the lens of a specific factors general equilibrium trade model applied at the district level the evidence shows that nominal wages for manual labor both within and outside agriculture respond elastically to increases in producer prices that is wages rose faster in rural districts growing more of those crops with large price run ups over 2004 09 accounting for such wage gains the analysis finds that rural households across the income spectrum benefit from higher agricultural commodity prices indeed rural wage adjustment appears to play a much greater role in protecting the welfare of the poor than the public distribution system india s giant food rationing scheme moreover policies like agricultural export bans which insulate producers as well as consumers from international price increases are particularly harmful to the poor of rural india conventional welfare analyses that assume fixed wages and focus on households net sales position lead to radically different conclusions

the transition to a market economy pitfalls of partial reform we present a theory of a partial economic reform of a planned economy similar to the one that took place in russia since 1988 and in china earlier in such a reform some markets are liberalized in the sense that producers can sell output to whomever they want including private firms at free prices but at the same time must sell to state firms at state prices we show that such a reform can result in a substantial diversion of subsidized inputs away from state firms and toward private firms even when state firms value these inputs more the result may be a reduction of total output the simple analysis sheds light on many consequences of the soviet reform such as breakdown of coordination of production increased state policing of delivery quotas prohibitions of trading cooperatives and opposition to privatization the model also explains why partial reform failed in russia but worked in china

the growth of agricultural protection in europe in the 19th and 20th centuries 1247 johan f m swinnen dramatic changes took place in agricultural policies in europe in the 19th and 20th centuries in the 1860s european nations agreed on a series of trade agreements which spread free trade across the continent in the 1960s european nations concluded an international agreement which spread heavy government intervention and protection against imports across the continent this paper quantifies these changes in protection over the course of a century relates them to changes in policies and offers a political economy explanation for the growth in agricultural protection in europe

a portfolio model of korean household saving behavior 1962 1976 in his recent paper on korea s saving and capital accumulation experience over the 1962 76 period williamson challenges development economists to improve on the simplistic models of saving behavior that have come to characterize studies of surplus mobilization in less developed countries he warns that we can no longer be satisfied with single equation ordinary least squares estimated models that ignore the simultaneous nature of the saving investment decision he further suggests that saving studies have been overly concerned with modeling total domestic saving flows and have consequently bypassed important issues relating to changes in sectoral saving patterns and within sectors changes in the composition of saving others have had similar criticisms mikesell and zinser and leff and sato complain that the specifications of total and sectoral saving functions in ldc macro studies have been unimaginative and not well grounded in theory 2 they acknowledge those household saving studies that have utilized theoretically appealing specifications based on wealth stock adjustment and life cycle saving models but they suggest that many studies have been ad hoc in nature and have tended to place excessive emphasis on current disposable income nia definition as the leading and in some cases the only explanatory variable preoccupation with simplistic keynesian saving models that emphasize current nia income is unfortunate since from a purely theoretical standpoint permanent and or capital gains adjusted income measures would be more appropriate explanatory variables to use along with expected real rate of return variables in household wealth accumulation studies indeed studies that have used permanent income and life cycle variables have yielded interesting results 3 mikesell and zinser and williamson point out that measuring the effect on saving of changes in interest rates has been handled in a

revisiting the cotton problem a comparative analysis of cotton reforms in sub saharan africa summary the cotton sector has been among the most regulated in sub saharan africa ssa and still largely is in west and central africa wca despite repeated reform recommendations by international donors on the other hand orthodox reforms in east and southern africa esa have not always yielded the expected results this paper uses a stylized contracting model to investigate the link between market structure and equity and efficiency in ssa cotton sectors explain the outcomes of reforms in esa and analyze the potential consequences of reforms in wca we illustrate our arguments with empirical observations on cotton sector performance

impacts of economic reform in poland incidence and welfare changes within a consistent framework the costs of shortages and rationing are not captured by standard consumer price indices thus the change in real gdp per capita is an overestimate of welfare losses in transition economics in this study virtual prices are used to calculate new cost of living indices clis the results for polant show that from 1987 to 1992 the cli ignoring the rationing effects is biased upward from 1 53 to 3 71 percentage points per year compared to the estimates of welfare loss that neglect the rationing effects during the prereform period the estimated welfare losses that reflect the rationing are reduced by 50 using hausman virtual prices and by 75 using external proxy virtual prices

some dynamic aspects of food standards food standards have existed since the beginning of trade and exchange but have increased and expanded in recent years affecting global and local value chains this has triggered vigorous debates on the impacts on trade and development standards may simultaneously enhance economic efficiency and redistribute rents complicating policy analysis and implying that the economics and the politics of standards are often hard to separate while substantial research has contributed important insights dynamic aspects of standards have not received much attention i present a framework to illustrate some dynamic economic and political aspects of standards in closed and open economies this framework integrates changes over time in preferences implementation costs and protectionist pressures as determinants of standards and suggests explanations for persistent differences in food standards across countries hysteresis in standards can persist due to protectionist motives even if the initial standards were not introduced for protectionist reasons i use some historical cases to document both the persistence and adjustment of standards over time and with international integration

the impact of remittances on economic growth an econometric model abstract remittances in the world represent one of major international financial resources which sometimes they exceed the flows of foreign direct investment fdi for centuries there have been heated debates on the sources of economic growth in developing economies and also why some countries reflect strong economic growth comparing to others this study aims to observe the impacts of remittances on economic growth using panel data set of six high remittances receiving countries albania bulgaria macedonia moldova romania and bosnia herzegovina during the period 1999 2013 these countries have experienced a major increase in remittance inflows and at this time accounts for the bulk of total remittance receipts compared with other regions most countries remittances represent the largest source of foreign exchange earnings and represent more than 10 percent of gdp in other words the econometric analysis will be based on those six remittance receiving countries the paper is then to review the empirical literature devoted to the impact of remittances on economic growth in order to identify empirically if there are significant relationships between remittances and growth in these countries the results suggest that remittances have a positive impact on growth and that this impact increases at higher levels of remittances relative to gdp

trickling down and scrambling up the informal sector food provisioning and local benefits of the carajas mining growth pole in the brazilian amazon abstract no empirical study has examined the local benefits of the world bank funded us 3 billion carajas mining project developed in the early 1980s in the brazilian amazon rainforest this study is based on interviews with company and government officials analysis of government figures and five small systematic surveys of food marketers and households it assesses overall local benefits and traces the origins of food consumed at carajas the informal sector in carajas s satellite boom town is examined from both the supply and demand sides it plays an important role in capturing local trickle down as does the local government ranchers and middlemen receive the greatest share of benefits accruing to the local area while small farmers receive little otherwise most products are imported from outside the region

the political economy of public research investment and commodity policies in agriculture an empirical study the paper tests a political economy theory of simultaneous government decision making on income redistribution through commodity policies and on public research investment in agriculture we use data from 37 countries on agricultural protection and public agricultural research expenditures pari the empirical results are consistent with the political economy hypotheses the analysis suggest that structural changes in the economy have important effects on the political incentives for governments not only to subsidize or tax farmers but also to invest in public agricultural research furthermore the analysis supports the hypotheses that the impact of such structural changes on government decision making on pari is non linear and conditional on other factors regarding the impact of political institutions the results suggest that more democracy neither leads to more distortionary transfers agricultural protection nor to lower investment in public goods pari

the microeconomics of the developmental paradox on the political economy of food price policy abstract a longstanding puzzle in comparative economics is the developmental paradox the tendency for government support for agriculture to increase with national income and to decrease with the proportion of economic activity and of the population in agriculture this paper offers a microeconomic explanation for that puzzle it establishes analytically the microeconomic basis for coalition alignments with respect to food price policy then numerically simulates the comparative static effects of alternative food policies on coalition structure a parsimonious household model applied to a heterogeneously endowed society demonstrates how variation in individual welfare effects might beget distinct coalitions in the debate over food price policy and how those policies are inextricably linked to land population and technology policies in food agriculture moreover coalition alignments on particular policy debates are path dependent in particular food price policy creates its own political support

estimating demand elasticities under rationing eliminating rationing in the united kingdom following the second world war was a concern for policy makers because of potentially large fluctuations in post war prices and the impact on unrationed goods this study shows that in using virtual prices elasticities can be estimated from a free demand system consistent with observed consumer choices substitution estimates without accounting for rationing are misleading in contrast using virtual prices and estimating a free market system yield results similar to those of the pre war period results show that food rationing affected expenditure across unrationed goods rationing on other services had little effect on expenditure across unrationed goods

mass media and public policy global evidence from agricultural policies mass media play a crucial role in information distribution and in the political market and public policy making theory predicts that information provided by the mass media reflects the media s incentives to provide news to different groups in society and affects these groups influence in policy making the paper use data on agricultural policy from 69 countries spanning a wide range of development stages and media markets to test these predictions the empirical results are consistent with theoretical hypotheses that public support for agriculture is affected by the mass media in particular an increase in media television diffusion is associated with policies that benefit the majority to a greater extent and is correlated with a reduction in agriculture taxation in poor countries and a reduction in the subsidization of agriculture in rich countries ceteris paribus the empirical results are consistent with the hypothesis that increased competition in commercial media reduces transfers to special interest groups and contributes to more efficient public policies

why do members of congress support agricultural protection it seems paradoxical that until recently developed countries have continued subsidizing agriculture even though their agricultural sectors had been declining in relative importance since the middle of the 20th century what drives support for agricultural protection the broad array of subsidies to farmers and taxes and quotas imposed on agricultural imports in developed countries we answer this question by testing three competing hypotheses about what drives support for agricultural protection in the us i legislator preferences ii electoral incentives or iii lobbying using data on the roll call votes of the members of the 106th through the 110th congresses 1999 2009 and the scores given to each legislator by the farm bureau our findings suggest that electoral incentives explain a great deal of the variation in support for agricultural protection but that legislator preferences and lobbying might play a role too moreover legislator preferences and electoral incentives appear to be substitutes for one another why does congress support agricultural protection because many members have electoral incentives to and because many of those who do not still have other personal or strategic interests at stake

gains from trade inefficiency of government programs and the net economic effects of trading a great deal has been written on the inefficiencies of government farm programs and associated welfare effects e g just hueth and schmitz 1982 gardner 1983 1987 schmitz sigurdson and doering 1986 schmitz 1988 however common measures of inefficiency and distributional impact have not addressed the following question how are gains from trade and the inefficiencies of government programs related from a policy perspective knowing the trade impacts of government programs is at least as important as knowing the inefficiency effects for example is it possible for gains from trade to outweigh farm program inefficiencies alternatively could it be that negative trade impacts combined with farm program inefficiencies create situations in which no trade would be preferred to trade under existing government policy distortions in this paper we establish the link between classic gains from trade and the inefficiency of distortionary government programs using this framework we show both theoretically and empirically that the net economic effects of trading can be negative i e no trade would be preferred to trade under distortions we show that

efficient redistribution through commodity markets efficiency in redistribution is measured in terms of deadweight loss generated per dollar of economic surplus transferred between consumers and producers of a commodity by means of market intervention the implications of supply and demand elasticities for efficiency in redistribution are examined with special attention to the comparison of production control and deficiency payment programs the results may be used to aid in the evaluation of commodity programs and as a basis for consideration of the hypothesis that observed policies are efficient given the political power of interest groups

changing coalitions in value chains and the political economy of agricultural and food policy within this issue of the oxford review of economic policy which focuses on the growing divergence between the agriculture sector and the food sector this paper focuses on how this changing divergence affects the political economy of agricultural and food policies

adapting natural resource enterprises under global warming in south america a mixed logit analysis this paper develops an integrated model of adapting natural resource intensive enterprises in latin america to future climate changes based on about 2 000 rural household surveys we model six specialized and diversified resource enterprises across seventeen land covers we estimate random coefficients of climatic parameters with a mixed logit model by 2020 under a hotter and drier ccc scenario crops only and cropforests enterprises are predicted to fall by 6 2 and 0 6 respectively offsetting these losses livestock only enterprise increases by 5 5 and crops livestock forests enterprise increases by 0 7 these changes magnify over time through 2060 by which time the crops livestock enterprise increases by more than 5 adaptation measures should be designed in a manner that captures the unique characteristics of latin american ecosystems

liberalization endogenous institutions and growth a comparative analysis of agricultural reforms in africa asia and europe thirty years ago a vast share of low and middle income countries was heavily state controlled the liberalizations of the 1980s and 1990s had greatly different effects on growth in countries in africa asia and europe a comparative framework is used to document these differences and a model is developed to formally analyze how liberalization affects production and income distribution when the institutions that govern production and exchange are also affected hypotheses are derived for how endogenous institutional adjustments affect the growth response to liberalization these insights motivate a series of explanations for the differences in performance across regions and commodities following liberalization

agricultural output and productivity in the former soviet republics the paper reviews agricultural development in the fifteen former soviet republics over the period 1965 1997 production functions are estimated and productivity differences and changes calculated large differences were found in terms of productivity and growth between the republics the differences grew after 1990 reflecting variation in reform policies

impact of the 2014 suspension agreement on sugar between the united states and mexico in december 2014 the u s and mexico agreed to a suspension agreement that set a 22 25 cwt import price floor on u s sugar imports from mexico a partial equilibrium trade model was developed to estimate the economic impact the agreement would have had if it had been in effect from 2008 to 2014 in years when the price floor would have been binding on average u s producers would have gained 138 million and mexican producers would have lost 218 million however total mexican welfare would have actually increased by 11 5 million furthermore the average price floor that would have maximized total mexican welfare over that period is 22 76 cwt also under certain supply and demand elasticity conditions the average price floor that would have maximized joint u s and mexican producer welfare over that period is 21 91 cwt the latter two estimates are both close to the actual price floor agreed to in the 2014 suspension agreement

explaining price policy bias in agriculture the calculus of support maximizing politicians a model is developed to explain observed patterns of policy intervention in agriculture we analyze the interaction between political support seeking politicians and supportsupplying citizens society consists of a rural and urban group we determine the effects on transfers of relative group size disparities in income endowments between groups and the deadweight loss of redistribution the framework advanced is an alternative to that of the interest group model and is used to explain for example why the export sectors in developing countries are taxed more and why the united kingdom is less adamant for higher price supports than germany

the short term impacts of development induced displacement on wealth and subjective well being in the brazilian amazon displacement due to development projects such as dams mines and urban infrastructure often leads to livelihood decline among affected communities the challenge therefore lies in implementing projects that achieve national or regional development goals while also generating positive social and economic outcomes for displaced populations this paper uses a longitudinal mixed methods design to understand the short term changes in wealth and subjective well being of households displaced due to construction of the belo monte dam in the brazilian amazon the households were compensated by either cash or credit for their lost land and assets and were then responsible for finding and purchasing new property using pre and post displacement household survey and semi structured interview data as well as data from a small comparison group i find that wealth increased for the majority of the study population and that socioeconomic inequality decreased as poorer households experienced greater improvements in housing conditions assets and property ownership in addition subjective well being improved for most households particularly among those who did not own land at baseline those who gained assets such as vehicles those who remained closer to the original study area and those who remained in close proximity to other households from the study population moving to an urban destination was strongly associated with declines in well being as was moving far from family or friends these results suggest that investing sufficient resources in a compensation based resettlement program can benefit households displaced by large infrastructure projects in the short term but additional data collection is needed after the completion of dam construction to determine whether these benefits are sustained over the longer term

domestic farm policy and the gains from trade this paper assesses the extent to which the gains from agricultural trade are influenced by both u s domestic policy and tariff and nontariff trade barriers it shows theoretically that the volume of trade can be substantial but the gains nonexistent empirical results along with rent seeking arguments support the no gains from trade hypothesis

donors and domestic policy makers two worlds in agricultural policy making in recent decades many developing countries have moved from taxing their agricultural sector to subsidizing it a phenomenon referred to as overshooting using ghana and uganda as case study countries this study aims to contribute to explaining this phenomenon by examining the role of policy beliefs the study is based on the advocacy coalition framework and relies on discourse analysis as analytical method in depth interviews with policy actors in both countries served as empirical basis a quantitative analysis of the transcripts was used to identify different discourse coalitions and a qualitative analysis was conducted to examine the discourses and identify their underlying policy beliefs the paper identified far reaching differences in the agricultural policy beliefs between domestic policy makers and donors regarding the question what does it actually take to develop small holder agriculture the evidence from this analysis highlights the role that divergent policy beliefs can play in influencing agricultural policy choices

international capital markets and interest groups capital market integration has increased the scale and mobility of capital movements within and among nations to unprecedented levels integration is fairly recent frankel concludes from his review of the literature that barriers in the major world financial markets were sufficiently low that by 1989 financial markets could be viewed as being fully integrated the scale and mobility of capital flows among nations has numerous implications to currency values interest rates wealth and through current capital account linkages to relative product and factor prices capital flows that have real economic effects also affect the functioning of policy instruments and how effective they are in remunerating an interest group at the expense if any of others this paper provides insights into the process and linkages by which the integration of capital markets has altered economic policy through interest group pressures on government if economic policy is viewed as the outcome of interest groups seeking through the power of the state that which cannot be provided by the market alone then capital market adjustments that affect the return to policy instruments can also affect the returns to lobbying resources and hence the balance of political influence among the various groups 2 this type of explanation for economic policy has been forwarded under the rubric of models of rent seeking krueger 1974 3 the paper is organized as follows 4 selected historical evidence linking capital markets to pressures for legislation in the united states and other countries is briefly reviewed in some cases capital market adjustments have eased pressures for protection while in other cases adjustments either forced policy change because of a liquidity constraint or made unprofitable the lobbying for sustaining policy in face of these adjustments the discussion in the next section provides deeper insight into capital market lobbying linkages discussion focuses on the results from a simple model of rent seeking where government intervenes in markets and provides sector specific public goods

cotton subsidies the wto and the cotton problem following an 8 year long dispute over cotton subsidies brazil and the united states signed a memorandum of understanding on april 21 2010 effectively paving the way for settling the dispute this paper argues that cotton subsidies are just the tip of the iceberg while a number of other perhaps more important issues require attention and indeed political will chief among them is the persistent divergence between cotton prices and the prices of other agricultural commodities which reflects for the most part the large supply response by china and india a direct consequence of con version to biotech cotton varieties in these and other countries such response which kept cotton prices low compared with other commodities imposes a competitive disadvantage to non users of biotech cotton the paper also highlights two additional constraints faced by the cotton producing countries of west and central africa namely the structural inefficiencies of their primary processing industries also known as ginning and the appreciation of the cfa franc against the us dollar without downplaying the importance of subsidy elimination the paper concludes that these impediments should receive high priority in the policy agenda

food insecurity income inequality and the changing comparative advantage in world agriculture i would like to argue in this article that in the process of economic development in land poor countries in asia agriculture faces three distinctly different problems food insecurity sectoral income inequality and the declining food self sufficiency associated with the declining comparative advantage in agriculture at the high income stage massive imports of food grains to asia if they occur will aggravate the world food shortage which will have significant implications for the poverty incidence in the world i argue that in order to avoid such a tragedy asia should expand farm size to reduce labor cost by adopting large scale mechanization sub saharan africa should realize a green revolution in grain production and latin america should further expand its grain production capacity

a positive theory of agricultural protection the present paper analyses the political economy of agricultural protection in a general equilibrium framework rational politicians offer protectionist policies in return for political support from their constituency individuals in the economy have different factor endowments politicians exploit these differences in establishing redistributive policies when maximizing political support changes in economic variables such as the urban rural income gap capital intensity the share of agriculture in total output and total employment and the share of food in consumer expenditures affect the political equilibrium policy the analysis concludes that the observed correlation between economic development and agricultural protection is caused by a multiplicity of factors

the politics of underinvestment in agricultural research this paper develops a political economy framework that determines the factors causing underinvestment in public research expenditures governments are unable to fully compensate for unequal income distribution effects of research because of either their inability to make credible commitments or ofdeadweight costs associated with compensation

when higher incomes reduce welfare queues labor supply and macro equilibrium in socialist economies starting from a micro model of consumer behavior under rationing by queuing that utilizes gary becker s allocation of time framework we develop a simple macroeconomic model of a socialist economy the length of the queue is the key endogenous variable that equilibrates aggregate supply and aggregate demand comparative statics analysis shows that an increase in wages over money prices brings about longer queues that reduce labor supply output and welfare when shortages grow beyond a certain critical level queues fail to sustain aggregate equilibrium in the economy

quadratic engel curves and consumer demand this paper presents a model of consumer demand that is consistent with the observed expenditure patterns of individual consumers in a long time series of expenditure surveys and is also able to provide a detailed welfare analysis of shifts in relative prices a nonparametric analysis of consumer expenditure patterns suggests that engel curves require quadratic terms in the logarithm of expenditure while popular models of demand such as the translog or the almost ideal demand systems do allow flexible price responses within a theoretically coherent structure they have expenditure share engel curves that are linear in the logarithm of total expenditure we derive the complete class of integrable quadratic logarithmic expenditure share systems a specification from this class is estimated on a large pooled data set of u k households models that fail to account for engel curvature are found ro generate important distortions in the patterns of welfare losses associated with a tax increase

policy coherence and food security the effects of oecd countries agricultural policies there have been important changes to agricultural policies in many oecd countries over the past decade and the international spill over effects of support and protection have diminished now would be a good time to eliminate remaining distortions and put in place more efficient alternatives including social safety nets and tools to help farmers manage risk this would lock in the benefits of reform and simultaneously address charges of policy incoherence in the context of high food prices new issues have emerged with potential implications for food security they include export restrictions the use of biofuel mandates and the opportunities and threats presented by increased foreign investment in agriculture on these issues as well as in terms of conventional support mechanisms policies in emerging economies in particular the briics are increasingly important a pro active agenda for policy coherence would involve not just eliminating policies that distort trade but also enacting positive measures to increase food availability for example by raising agricultural productivity using resources sustainably and eliminating waste and over consumption across countries there are important gains to be realised from knowledge sharing and from multilateral action to provide global public goods not least smoother functioning of the multilateral trading system