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Implementable Ramsey‐Boiteux Pricing in Agricultural and Environmental Policy
Author(s) -
Bourgeon Jean-Marc,
Chambers Robert G.
Publication year - 2008
Publication title -
american journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.949
H-Index - 111
eISSN - 1467-8276
pISSN - 0002-9092
DOI - 10.1111/j.1467-8276.2007.01120.x
Subject(s) - product (mathematics) , agriculture , economics , production (economics) , set (abstract data type) , price policy , microeconomics , price discrimination , range (aeronautics) , computer science , mathematics , ecology , geometry , programming language , biology , materials science , composite material
Agricultural producers frequently face price discrimination that is based either on characteristics of their products, or on the physical manner in which the product is produced. We consider how to set such discriminatory prices optimally and show that for a very broad range of production technologies, the first‐best voluntary policy, which involves a modified version of Ramsey‐Boiteux pricing, is implementable even in the presence of hidden knowledge by farmers about their types.