On the relevance of world agricultural prices
This report is part of an attempt to model the global markets for primary commodities and to use these models for forecasting purposes as well as for policy analysis. In a free market, domestic prices on agricultural products could be expected to vary with world prices. But intervention is so common with agricultural products that prices vary between countries and gaps exist between world and domestic prices. International prices are often used as a proxy for domestic prices. But it is often claimed that world prices are irrelevant to agricultural development in countries that intervene in agricultural pricing. This paper examined the appropriateness of this substitution in measuring, for example, the agricultural supply response to price changes - particularly in the long run. It concluded that on the whole, world prices are indeed relevant. The results - for 18 countries and 17 commodities - are surprisingly robust, and invariant to both data sources and time/commodity pooling.
|Date of creation:||31 Mar 1990|
|Contact details of provider:|| Postal: 1818 H Street, N.W., Washington, DC 20433|
Phone: (202) 477-1234
Web page: http://www.worldbank.org/
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Rausser, Gordon C & Freebairn, John W, 1974. "Estimation of Policy Preference Functions: An Application to U.S. Beef Import Quotas," The Review of Economics and Statistics, MIT Press, vol. 56(4), pages 437-449, November.
- Anderson, Kym, 1983. "Growth of agricultural protection in East Asia," Food Policy, Elsevier, vol. 8(4), pages 327-336, November.
When requesting a correction, please mention this item's handle: RePEc:wbk:wbrwps:383. See general 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: (Roula I. Yazigi)
If references are entirely missing, you can add them using this form.