REASSESSING PRODUCER BEHAVIOUR IN A POLICY MODIFIED PRODUCTION ENVIRONMENT

Robert Fraser

No 268389, Economic Research Papers from University of Warwick - Department of Economics

Abstract: This paper presents a new approach to assessing the impact of price support policies on producer behaviour. This approach takes explicit account of the impact of such policies on a producer's uncertain production environment and includes a numerical procedure for calculating ex ante price variability from ex post producer price data. The methodology is applied to European agricultural industries in which intervention purchasing schemes operate. Results show that price support policies can so severely distort the signal producers receive from world markets that their supply response is the opposite of that which would occur in the absence of the policy.

Keywords: Demand and Price Analysis; Institutional and Behavioral Economics (search for similar items in EconPapers)
Pages: 27
Date: 1990-03-03
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Persistent link: https://EconPapers.repec.org/RePEc:ags:uwarer:268389

DOI: 10.22004/ag.econ.268389

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