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Unformatted text preview: Agricultural Price Supports by Robert L. Thompson Most governments around the world intervene actively in the operation of their agricultural markets. The ways they intervene and the reasons they do so depend in large part on the wealth of the country. Governments in poor Third World countries routinely impose price controls to keep food prices artificially low. They do so to gain favor with their more politically powerful urban residents. Though numerous (and partly because they are numerous), peasant farmers do not organize politically and therefore have much less political power than their urban brethren. The irony of this situation is that by artificially depressing the price of food, Third World governments reduce incentives for farmers to produce and reduce the availability of food from indigenous sources. This has been particularly prevalent in Africa, the one continent to experience consistently...
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This note was uploaded on 07/15/2008 for the course BCIS 3610 taught by Professor Koh during the Spring '08 term at North Texas.
- Spring '08