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Monopsony and Time-Consistency: Sustainable Pricing Policies for Perennial Crops

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Author Info
Besley, Timothy

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Abstract

Since farmers in developing countries must make sunk investments to produce perennial crops, governments, in the guise of state-run marketing boards, face constraints on maximal sustainable price which can be charged by a marketing board assuming that "punishments" involve reversion to subsistence by untrusting farmers. This maximal price balances concerns about revenue extraction against the incentive of governments to cheat by capitalizing on sunk investments. Copyright 1997 by Blackwell Publishing Ltd

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Article provided by Blackwell Publishing in its journal Review of Development Economics.

Volume (Year): 1 (1997)
Issue (Month): 1 (February)
Pages: 57-70
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Handle: RePEc:bla:rdevec:v:1:y:1997:i:1:p:57-70

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  1. Schiff, Maurice, 1994. "Commodity exports and the adding up problem in developing countries : trade, investment, and lending policy," Policy Research Working Paper Series 1338, The World Bank. [Downloadable!]
  2. Azam, Jean-Paul & Bates, Robert & Biais, Bruno, 2009. "Political Predation and Economic Development," IDEI Working Papers 342, Institut d'Économie Industrielle (IDEI), Toulouse. [Downloadable!]
    Other versions:
  3. Margaret McMillan, 1998. "A Dynamic Theory of Primary Export Taxation: Evidence From Sub-Saharan Africa," Discussion Papers Series, Department of Economics, Tufts University 9812, Department of Economics, Tufts University. [Downloadable!]
  4. Margaret S. McMillan & William A. Masters, 2000. "Africa's Growth Trap: A Political-Economy Model of Taxation, R&D and Investment," CID Working Papers 50, Center for International Development at Harvard University. [Downloadable!]
    Other versions:
  5. Kala Krishna, 1995. "The Adding Up Problem: A Targeting Approach," NBER Working Papers 4999, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  6. Margaret S. McMillan, 1999. "Foreign Direct Investment: Leader or Follower?," Discussion Papers Series, Department of Economics, Tufts University 9901, Department of Economics, Tufts University. [Downloadable!]
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