Chapter 3 L Flashcards
What exactly does the gov do in relation to agriculture?
Gov tries to supply adequate food for its citizens.
Wants to also secure farm incomes (cause they are volatile)
Agriculture prices are price sensitive to small changes in supply.
Does the gov pay farmers?
yes. taxpayers pay farmers through direct assistance.
Farmers get roughly 40% of their income through gov support systems.
Whay does the us and French do?
gov provides PRICE SUPPORT PROGRAMS (which is a price floor).
they buy as much as possible from producers which gives then incentive to produce lots. problem is that supply>demand so they must store excess.
What does the marketing boards do?
controls creation of dairy, eggs, poultry. must have quotas to produce and only allowed so much. restrictions on amounts increases prices.
Canadian wheat board acts as seller for producers. pays 0.75/1$ and gives the difference when sold.
Problem with marketing boards?
inefficient farms,
although they protect farming jobs, thousands of food processing jobs are lost due to higher production costs. plus, consumers have to pay much more.
