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On the Design of Agricultural Policy Mechanisms
Author(s) -
Chambers Robert G.
Publication year - 1992
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 - 10.2307/1242577
Subject(s) - mechanism (biology) , agriculture , agricultural policy , economics , control (management) , mechanism design , agricultural productivity , business , public economics , microeconomics , ecology , philosophy , management , epistemology , biology
Abstract The fact that different agricultural policy mechanisms have emerged for different commodities suggests that the choice of policy instrument may reflect the goals of agricultural policy makers. This paper uses the principles of mechanism design under asymmetric information to examine the motivations underlying the choice of agricultural policy mechanisms. It is found that supply control mechanisms favor high‐cost producers and the budget, while mechanisms resulting in overproduction favor low‐cost producers.