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EFFECTIVE RATES OF PROTECTION AND HIDDEN SECTORAL TRANSFERS BY PUBLIC AUTHORITIES
Author(s) -
Kolsen H. M.
Publication year - 1983
Publication title -
australian journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.683
H-Index - 49
eISSN - 1467-8489
pISSN - 0004-9395
DOI - 10.1111/j.1467-8489.1983.tb00628.x
Subject(s) - intervention (counseling) , subsidy , economic interventionism , government (linguistics) , public economics , economics , resource allocation , public policy , business , economic growth , political science , market economy , politics , psychology , linguistics , philosophy , psychiatry , law
Government intervention changes the allocation of resources through effects on input and output prices. While explicit forms of intervention have been the subject of many studies, implicit forms of intervention have been given much less attention. The price and output policies pursued by public authorities systematically cross‐subsidise from densely populated to sparsely populated areas. Thus, their effects are in the opposite direction from the effects of tariffs and quotas. Examination of the effects of one form of intervention in isolation overstates the net effects of that intervention. Effective rates of cross‐subsidies must be taken into consideration when attempting to measure the impact of government intervention on resource allocation.