Food Policy Final

Front 1

How do humans view their place/role in the environment? (2 definitions)

Back 1

Holistic: whole system interacts in "web" or "lattice", every action connected
Atomistic:pieces interact with linear cause and effect, little attention to broader effects unless they begin to effect demand

Front 2

The second half of agriculture development was based on what type of thinking?

Back 2

atomistic. we started intensification vs extensification. add water, lime, phosphorous: Danger- fallacy of composition

Front 3

Why is agricultural pollution different from industrial pollution?

Back 3

Hard to pin-point a source, called "nonpoint-source pollution" the runoff from many farms causes pollution

Front 4

5 principals of environmental Regulation

Back 4

1- When parties bear damage, they have incentrive to reduce damages
2- Policy makers can induce any given behavior by imposing a large enogh penatly
3- Policy makers can induce efficient entry and exit by imposing the rule "everyinjurer pays FULL damages"
4- The marginal cost of abatement(cutting back on problem) should be the same across all injurers
5- It is always best to use regulatory instrument focused on actual source of problem, be as direct & flexible as possible
5-

Front 5

Possible Policy Responses to Environmental Problem

Back 5

Market Regulation, Economic incentives (taxes or subsidies), legal liability

Front 6

Types of Environmental Regulation

Back 6

performance standards(emissions standards), design standards(must use particular equipment), restrictions on input use (ban of DDT), output restrictions, regulation of land use, policy-related restrictions

Front 7

What is the harvest index? def and %

Back 7

Increase our efficiency to the maximum possible, each plant can have at most 60% efficiency

Front 8

What are our Net Primary Production (NPP) dynamics

Back 8

we have local externalities (your farm's runoff) and pervasive externlities (effects the entire system, eg. using oil to transport everything)
25% of the entire world's resources are used for humans, we are taking up 40% of the land

Front 9

Neo Malthusian

Back 9

We have always had theories that we will run out of food, but we always find a way to overcome it. We can keep innovating and changing the rules/boundries of the Earth and we will survive

Front 10

SAK stated premise

Back 10

the food system is consumer driver, rather than producer driven. Consumers look for the following attributes: quality, value, convenience, nutrition, wholesomeness
Poultry consumption increased by 62% while beef dropped 27% between 76-89

Front 11

8 consumer Trends

Back 11

demographics, working women/convenience, changing eating patters, food safety concerns, food variety, nutrition/obesity concerns, food retailing, agricultural production

Front 12

Demographics

Back 12

Consumer trend: decline in pop growth/avg. household size, we have an older population, growth of ethnic groups

Front 13

Working women/convenience

Back 13

Consumer Trend: more women in work force leads to time pressure. demand for convenience mixed with higher incomes = ability to pay for convenience

Front 14

changing eating patterns

Back 14

Consumer Trend: dining w/family and 3 square meal declining. Individual choice is up, each family member eats what they want. Cheese consumption stayed solid [bc of pizza] while pork declines
48% of our food is eaten away from home, food price index up from $46 to $482
betty crocker vs from scratch

Front 15

Food safety concerns

Back 15

consumer trends: food borne diseases, pesticides, GMOs

Front 16

Nutrition/Obesity Concerns

Back 16

2/3 of U.S. deaths from heart disease, cancer and stroke.
consumer trend: 30% of Americans are obese, another 34% are overweight
consumer schizophrenia: concern/awareness does not match actual consumptive behavior

Front 17

Food Variety

Back 17

consumer trend: 10,000 new products every year
Total product concept = physical attributes + packaging + advertising + brand + convenience

Front 18

Food Retailing

Back 18

consumer trend: fewer, bigger supermarkets. one stop shopping

Front 19

Agricultural Production

Back 19

consumer trend: more production under contracts, must respond to market needs (fresh, safe, nutritious, convenient, high quality)

Front 20

Food Economics: we use economic science to explain: (2)

Back 20

food consumption patterns, behaviors of consumers

Front 21

Food consumption is determined by:

Back 21

income, price, taste, preferences

Front 22

define: demand schedule

Back 22

a price-quantity relationship, it assumes other things such as income, are constant

Front 23

demand shift or move along curve: russia put embargo on our wheat

Back 23

change in quantity demands: move

Front 24

demand shift or move along curve: economy in slump: income falls

Back 24

change in demand: shift

Front 25

demand shift or move along curve: drought reduces crop size

Back 25

move along curve

Front 26

demand shift or move along curve: price of substitutes falls:

Back 26

change in demand: shift

Front 27

Engel's insight into Food Budget Shares

Back 27

as income increases, percent of income spent of food decreases.

Front 28

Elasticites:
n > 1 =
n < 1 =
n < 0 =

Back 28

luxury
necessity
inferior good

Front 29

income elasticity in higher for:

Back 29

foods for which quality is more important and food eaten away from home

Front 30

nominal price

Back 30

actual price paid per unit of good

Front 31

CPI:

Back 31

consumer price index: an average change in prices for a fixed market basket of goods

Front 32

inflation

Back 32

percent change in CPI

Front 33

real price

Back 33

the nominal price divided by CPI. a form of "relative price"

Front 34

real income

Back 34

consumer income / CPI

Front 35

relative price

Back 35

price paid relative to another price paid (p1/p2). aka "real" price

Front 36

unitary elastic

Back 36

E=-1

Front 37

perfectly inelastic

Back 37

E=0 ( nD=0 ) demand exists at ANY price
transplant heart, water when almost dead from thirst

Front 38

perfect elasticity

Back 38

E = infinity
the smallest measurable change in price will result in infinite change in demand

Front 39

own price elasticity

Back 39

the percent change in quantity demanded in response to a one percent change in it's own price

Front 40

cross price elasticities

Back 40

the percent change in quantity demanded for a range of goods in response to a one percent change in a different (but similar [substitute?]) good's price

Front 41

what cross price elasticities means (the numbers)

Back 41

E > 0 : the goods are substitutes
E < 0 : the goods are complements

Front 42

What do we like to use elasticies?

Back 42

because they don't use units so it is easier to analyze change

Front 43

are most food elastic or inelastic?

Back 43

inelastic. poor households consume inferior goods

Front 44

What is the US's food budget share?

Back 44

10%, the lowest of all countries, however lower income houses spend 30%

Front 45

how many people suffer from hunger?
hunger and malnutrition?

Back 45

800 million
I billion: 17% percent of the world
children suffer first, then women

Front 46

how many people die per year?

Back 46

1% of those who are hungry and malnourished, about 24,000 per day

Front 47

how many people live on less than $2 per day?

Back 47

3 billion people (out of 6.5 billion)

Front 48

if the whole world ate as we did, how many people could be fed?

Back 48

2.5 billion

Front 49

hunger:

Back 49

sustained falure to consumer nutrients in sufficient quantity and in proper proportion to sustain normal bodily functions

Front 50

malnutrition

Back 50

deficiency of proteins or other key nutrients

Front 51

overnutrition:

Back 51

intake of food excess of bodily needs

Front 52

famine

Back 52

hunger occurring to a large population over a wide area for a period of time lasting months to years

Front 53

6 Causes of Hunger

Back 53

poverty, income problem, logistic access problem, low education problem, inequality of income, poor health

Front 54

food deficit value equations

Back 54

HH food consumption requirement - HH food production) x price of food

Front 55

social scale food security is determined by

Back 55

the integrity of the entire production system in its ability to ensure HH level food security as a norm, for an indefinite period of time

Front 56

7 potential solutions to world hunger

Back 56

1: increase productivity: expand green revolution?
2: cultivate more land: crops occupy 11% of available land, pastures 25%
3: catch more fish: overfishing?
4: Aquaculture: raising more fish, currently supplies 12% of fish market
5: Government policies: low food prices, reduce population rates, improve income distribution
6: international assistance: ag. and rural development, food aid
7: Land reform: give the landless poor free use of enough land to produce their own food (maybe even a surplus)

Front 57

How much GNP does the US give to aid?

Back 57

only .1% while the average of the world is .22% (norway gives .9)

Front 58

who receives the most aid from us?

Back 58

Israel and Egypt. political reasons?

Front 59

How many people are poor in the US

Back 59

13%, 37 million people

Front 60

objective of WIC

Back 60

improve health of low-income pregnant, breastfeeding, andmothers of childrenup to 5 years

Front 61

sources of food safety risks

Back 61

farm production practices, improper sanitation, highly processed foods (artificial ingredients, preservatives, colorings)

Front 62

in the US, food borne pathogens cause an estimated:
illnesses, hospitalizations, deaths

Back 62

76 million illnesses
325,000 hospitalization
5,000 deaths

Front 63

caveat emptor

Back 63

let the buyer beware

Front 64

Levels of Risk

Back 64

Zero Risks: for certain carcinogens
Neglibible or de minimus risk:
No significant risk: 1/100,000
Cost/benefit analysis: risk-benefit assestment, insecticides, fungicides

Front 65

3 options to reduce/eliminate pesticide use:

Back 65

1: integrated pest management IPM
2: biotechnology (GMOs)
3: organic products

Front 66

4 food safety concerns

Back 66

microbiological contaminations, pesticide residues, new technologies, other issues (mad cow, avian flu, terrorism, nutritional

Front 67

poor diets and lack of exercise, which lead to obesity, are responsible for how many deaths per year?

Back 67

more than 400,000

Front 68

Obesity has an estimated social cost of ___ per year

Back 68

120 billion a year

Front 69

4 Stages of the Food Market System

Back 69

Farming, food processing, food wholesaling, food retailing/food service

Front 70

US food system consists of
___farmers
____ consumers
___eating places

Back 70

2 million farmers
300 million consumers
4 million eating places

Front 71

What is the biggest cost in the food system

Back 71

labor

Front 72

how much is sales did the food sector bring in per year

Back 72

949 billion

Front 73

Food Marketing Bill reflects:

Back 73

the difference between total consumer expenditures for all domestically produced food products and what farmers received for the equivalent farm commodities. on average farmers receive 19 cents per dollar

Front 74

sources of concern about concentration (5)

Back 74

1- concentration in purchased inputs (4 largest firms supply about 50% of farm machinery/chemicals)
2- concentration in food markets (retailers and food processors, CR4= 90% breakfast cereals, 90 % boxed beef, 68% cattle slaughter, 75% corn wet milling)
3- related concerns of efficiency and price
4- social concerns: demise of family farm, rural social fabric. contract farming
5 - other concerns: food safety outbreaks very large, market power has weight on non-farm sector

Front 75

how many farmers in 1935?

Back 75

7 million, we're now down to 2 million

Front 76

what is the function of food processing?

Back 76

to add utility and value to raw farm products. it is becoming more and more concentrated

Front 77

how many people eat at McDonalds per day?

Back 77

20 million, one in 14 people

Front 78

how much farm production is exported?

Back 78

25%

Front 79

Why trade?

Back 79

specialization, absolute advantage(a country can naturally produce at a lower cost than anywhere else), comparative advantage (when total output can be increased when each country speacializes and trades

Front 80

Types of trade barriers

Back 80

trariff vs non tarrif (import quaota, export subsidies, health/safety restrictions)

Front 81

GATT

Back 81

Gneral Agreement on Tariffs and trade

Front 82

Doha Negoatiations

Back 82

reduce export subsdies, improve market access, and reduce trade-distorting domestic support (along with things about the environment, property rights, etc)

Front 83

Boxes

Back 83

Green: permitted, minimal trade distorting payments such as income support (decoupled)
Blue: permitted, min trade-dist. payments because production cannot respond much due to other constraints
Amber: to be reduced: distort production
Red: forbidden, currently nothing is red

Front 84

effects of trade diversion

Back 84

trade creation: resources shift from the least to the most efficient
trade diversion: trade diverts from outside producers to less efficient inside producers
efficiency effects: usually increases

Front 85

G-8

Back 85

trading Blocks, biggest 8 economics, usa, russia, UK, japan, france, germany, italy canada, russia

Front 86

Structural Adjustment Programs

Back 86

sponsored by World Bank
Causes: fiscal deficits, external depts, balance of payment deficits
Remedies: devaluate currency, eliminate import/export barriers, privatization, reduce public employment
results: pressure on poor, more money coming from developing countries than going in