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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


-Externalities

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