Publication Date:
2013-05-31
Description:
This paper investigates the optimal reform of introducing decoupled payments in the agrofood sector. The model captures the vertical structure of the sector where the domestic processors exert potential oligopsony power towards farmers and compete with foreign firms in the home market. The results suggest that the government may face a potential trade-off of introducing decoupled payment, while committing to the restriction of trade barriers. The presence of imperfect competition makes it more likely for the government to keep a high level of trade barriers and production subsidy after the introduction of decoupled payment.
Keywords:
L13 - Oligopoly and Other Imperfect Markets, Q18 - Agricultural Policy
;
Food Policy
Print ISSN:
0165-1587
Electronic ISSN:
1464-3618
Topics:
Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition
,
Economics
