An Economic Analysis of the Special Milk Classes Scheme of Canada and the Agricultural Subsidy
AbstractWe examine the effects of Canada's Special Milk Classes Scheme on resource allocation and discuss the rationale for average total cost of production as a measure of payments. Our simple model divides the total supply of fluid milk into two classes: one for domestic consumption and the other for export. First we show that the regulated high price of milk sold for domestic consumption does not yield cross subsidization if the processed milk for export is traded freely in the international market. In addition, the price of milk processed and sold for export may not be lower than the average total cost in some cases. It implies that the average total cost standard does not necessarily provide the proper measure of the subsidy.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Research Institute of Economy, Trade and Industry (RIETI) in its series Discussion papers with number 11042.
Length: 20 pages
Date of creation: Apr 2011
Date of revision:
Contact details of provider:
Postal: 11th floor, Annex, Ministry of Economy, Trade and Industry (METI) 1-3-1, Kasumigaseki Chiyoda-ku, Tokyo, 100-8901
Web page: http://www.rieti.go.jp/
More information through EDIRC
This paper has been announced in the following NEP Reports:
You can help add them by filling out this form.
reading list or among the top items on IDEAS.Access and download statisticsgeneral information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (NUKATANI Sorahiko).
If references are entirely missing, you can add them using this form.