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3 Cards in this Set

  • Front
  • Back
Causes of market failure

-Unstable commodity markets

-Public goods

-Imperfect market information

-Labour immobility


Minimum price Schemes

+Foreign aid for to LEDC (from surpluses)

+Farm incomes are stabilised (higher incomes)

+EU self sufficient in food from stockpiles

-Higher food prices

-Storage and security costs for surpluses

-Opportunity cost of gov' spending on surpluses

Buffer Stocks

Good harvest supply goes too high, agency buys

Bad harvest supply too low, agency sells.

+farm incomes stabilised

+Surpluses foreign aid to LEDCs

+Easier for consumers to budget

-Series of good harvests agency has to keep buying (very expensive)

-Stocks are perishable

-Foreign may disrupt foreign recovery