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Food subsidies and market interdependence: the case of the Moroccan soft wheat subsidy
Author(s) -
Azzam Azzeddine M.
Publication year - 1991
Publication title -
agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.29
H-Index - 82
eISSN - 1574-0862
pISSN - 0169-5150
DOI - 10.1111/j.1574-0862.1991.tb00161.x
Subject(s) - subsidy , economics , consumption (sociology) , indirect effect , production (economics) , government (linguistics) , agricultural economics , microeconomics , market economy , social science , linguistics , philosophy , sociology , political science , law
Among the several propositions advanced to explain the rising cost of subsidizing soft wheat production and consumption in Morocco are the indirect effects emanating from related markets, namely the hard wheat and barley markets. A three‐sector supply‐demand model, described in this paper, was used to estimate the direct and indirect (induced) effects on government cost of changes in the soft wheat subsidy. The results show that virtually all the indirect effects come from the soft wheat market itself. The indirect effects emanating from the related markets are negligible.