Recent Macroeconomic Dynamics and Agriculture in Historical Perspective

This article explores the similarities, differences, and implications from the 1970s–1980s experience for the macroeconomic dynamic that may arise from the 2008 price spike and subsequent recession. Role of monetary policy (deviations from Taylor rule) is assessed. This is an argument that has not been too prominent in public discourse about causes of the financial crisis or the policies undertaken to restore stability to financial markets and avoid an even deeper downturn than occurred. The ‘‘misery index’’ is compared across the past and recent macroeconomic events. Effects on agriculture of exchange rates are reviewed, effects dependent on currency values and interest rates that can change quickly and in unexpected ways.monetary policy, exchange rates, macroeconomic effects on agriculture, Agribusiness, Agricultural Finance, Environmental Economics and Policy, Political Economy, Production Economics, Public Economics, E52, F41, Q18,

Can U.S. Farm Subsidies Be Bought Out?

Achieving substantial agricultural trade liberalization has proven elusive in the Doha Round. This paper examines policy reforms the United States might adopt to facilitate progress. The focus is on whether decoupling can be made more convincing through a long-term buyout that would end farm subsidies. Buyouts have not been feasible in the past but recent reforms for several specialty crops provide evidence of what might be done and the conditions under which it occurs. Although the political-economy conditions may not be conducive to such a buyout yet, estimates are provided of the potential cost of a buyout of the main U.S. farm support subsidies of direct fixed and counter-cyclical payments.Agricultural and Food Policy,

MEXICO-U.S. AVOCADO TRADE EXPANSION

International Relations/Trade,

United States: Shadow WTO Agricultural Domestic Support Notifications

"This paper examines past and proposed U.S. domestic support in light of current and potential World Trade Organization (WTO) constraints. It provides a brief review of U.S. farm policies since the Uruguay Round WTO agreements went into effect, including a synopsis of the new Food, Conservation, and Energy Act of 2008. It examines the United States' notifications to the WTO of domestic support from 1995 to 2005 and provides a preliminary notification estimate for 2006. Green-box (non trade-distorting) expenditures for domestic nutrition programs dominate the total dollar values notified by the United States. The main notified components of the U.S. support policies for agricultural producers include fixed direct payments, disaster assistance, and environmental payments in the green box; market price supports for dairy and sugar and substantial price-linked, loan-rate-related subsidy expenditures in the product-specific aggregate measure of support (AMS) category; and non product-specific support notified as de minimis, including crop market loss assistance payments, countercyclical payments, and crop and revenue insurance subsidies. The United States' notification of total AMS has not exceeded the Uruguay Round commitment of $19.1 billion. It would have exceeded this amount in some years if the fixed direct payments were included in the AMS, an issue arising in challenges to the U.S. notifications. This paper discusses other subsidies that may be underreported, misclassified, or omitted, including the blender tax credits and mandates related to ethanol production that have been largely outside the disciplines of the Uruguay Round Agreement on Agriculture. It also provides an assessment of projected U.S. support through 2014. Under the Uruguay Round rules, there is essentially no constraint on U.S. policies if high prices projected in mid 2008 are realized. The WTO constraints are tighter if the proposed Doha Development Agenda disciplines of July 2008 are agreed upon. In that case, under the projected prices, the United States would still have some leeway to increase expenditures under its commitments. Thus, if the economic environment that is foreseen in the projections proves correct, the United States would be able to adapt to the proposed Doha Round domestic support modalities by making only modest adjustments in its policies, although product-specific support for sugar, cotton, or other products could face constraints. Large payments under a new revenue guarantee program in the 2008 farm bill could violate the U.S. commitments, even if prices remain high enough not to trigger traditional countercyclical or loan-rate payments." from authors' abstractU.S. agricultural support, WTO Doha Round, WTO compliance, Food, Conservation and Energy Act of 2008, Notification of domestic support, trade,

Asymptotically efficient triangulations of the d-cube

Let $P$ and $Q$ be polytopes, the first of "low" dimension and the second of "high" dimension. We show how to triangulate the product $P \times Q$ efficiently (i.e., with few simplices) starting with a given triangulation of $Q$. Our method has a computational part, where we need to compute an efficient triangulation of $P \times \Delta^m$, for a (small) natural number $m$ of our choice. $\Delta^m$ denotes the $m$-simplex. Our procedure can be applied to obtain (asymptotically) efficient triangulations of the cube $I^n$: We decompose $I^n = I^k \times I^{n-k}$, for a small $k$. Then we recursively assume we have obtained an efficient triangulation of the second factor and use our method to triangulate the product. The outcome is that using $k=3$ and $m=2$, we can triangulate $I^n$ with $O(0.816^{n} n!)$ simplices, instead of the $O(0.840^{n} n!)$ achievable before.Comment: 19 pages, 6 figures. Only minor changes from previous versions, some suggested by anonymous referees. Paper accepted in "Discrete and Computational Geometry

The polytope of non-crossing graphs on a planar point set

For any finite set \A of $n$ points in $\R^2$, we define a $(3n-3)$-dimensional simple polyhedron whose face poset is isomorphic to the poset of ``non-crossing marked graphs'' with vertex set \A, where a marked graph is defined as a geometric graph together with a subset of its vertices. The poset of non-crossing graphs on \A appears as the complement of the star of a face in that polyhedron. The polyhedron has a unique maximal bounded face, of dimension $2n_i +n -3$ where $n_i$ is the number of points of \A in the interior of \conv(\A). The vertices of this polytope are all the pseudo-triangulations of \A, and the edges are flips of two types: the traditional diagonal flips (in pseudo-triangulations) and the removal or insertion of a single edge. As a by-product of our construction we prove that all pseudo-triangulations are infinitesimally rigid graphs.Comment: 28 pages, 16 figures. Main change from v1 and v2: Introduction has been reshape

Agricultural policies in Indonesia

As in many other developing countries, the concerns about food security in Indonesia during the 1980s and early 1990s resulted in policies aimed at achieving self-sufficiency in food crops. The Government of Indonesia (GOI) combined price interventions and economic incentives to encourage agricultural production, especially of the staple crops. From 1985 to 1998, Indonesia started a series of domestic and trade reforms emanating from a combination of unilateral undertakings, the country's commitments to the WTO, and the government's agreement with the IMF following the 1997/98 financial crisis. This study computes nominal protection rates and producer support estimates (NPR and PSE) for Indonesia for the period 1985-2003 for six agricultural commodities, rice, maize, sugar, soybeans, crude palm oil, and natural rubber (representing more than two-thirds of Indonesian agricultural output) in an attempt to quantify the net effects of these policies. The NPRs and PSEs computed for Indonesia show that in spite of the reforms, the GOI has protected its agriculture over the past twenty years, although not uniformly across commodities. Although the reforms went a long way in reducing trade and domestic regulations on agricultural products, the study results demonstrate a return to protection for some commodities in recent years.

Determinants of Technical Barriers to Trade: The Case of US Phytosanitary Restrictions on Mexican Avocados, 1972-1995

International Relations/Trade,