WTO makes progress in cutting farm subsidies

[Kuciwalker]

To us? No.

[Spiffor]

Originally posted by Imran Siddiqui
Kid, sometimes I wonder about you. LoA posted a graph which is in just about EVERY macroeconomics textbook and you claim he made it up or its wrong?

This graph is the core of classical and neo-classical economics. And it is the main reason why this entire chunk of economics deserves to go to trash.

[Kidlicious]

Originally posted by Lawrence of Arabia
your graph kid doesnt show what the world price is, or how much imports are being brought in at those prices, so if the world price is below original, getting rid of subsidies will push the price down, since world supply is considered infinite.

The only difference in the world price should be transportation costs. When the subsidy is removed prices will increase in the world and in the local market. There is no way that enough suppliers will come into the local market to make the price fall. It's like bouncing a ball. The ball will never reach the height where you bounce it from unless you bounce it off of a trampoline.

[Kidlicious]

Originally posted by Last Conformist

Do I need point out that those two sentences contradict one another?

Well, I'll just have to leave it to you to understand what I'm saying. I don't pretend to be a marxist in the absolute sense. I just call my self one because it's the closest label for me.

[Kidlicious]

Originally posted by Imran Siddiqui
Kid, sometimes I wonder about you. LoA posted a graph which is in just about EVERY macroeconomics textbook and you claim he made it up or its wrong?

It violates the Law of Supply. I did a search on the web and found the graph I posted, nothing of the sort that LoA posted. There is something mixed up about his graph or he is explaining it wrong.

LoA,

You need to provide a link or source at least.

[lord of the mark]

I think y'all need to clarify if the local market is big enough to impact the world market, or if the world price is a given.

If the latter, than Ps represents the price domestic suppliers recieve - it cant be the price domestic consumers pay, which cant be higher than the world price plus transport costs, since the world market represents a perfectly elastic source of supply.

If the former, than you need to show world supply and demand to complete the analysis.

[Kidlicious]

The graph presented by LoA demonstrates tariffs. I just found it on the net at www.bized.ac.uk. I say he fixed it and tried to pass it off. If he wants to prove otherwise he can give a source.

[lord of the mark]

Originally posted by Kidicious
The graph presented by LoA demonstrates tariffs.

that would make more sense.

[lord of the mark]

Originally posted by Imran Siddiqui
Kid, sometimes I wonder about you. LoA posted a graph which is in just about EVERY macroeconomics textbook and you claim he made it up or its wrong?

surely you meant MICROeconomics?

[lord of the mark]

Originally posted by CerberusIV
Security of food supplies is also a national security issue. The main reason the UK has supported its agricultural industry for the last 60 years was the German attempts in two world wars to cut the import of food as well as raw materials to the UK.

So anyone opposing agricultural subsidies is a terrorist!!!

As for reliability of third world suppliers, there is a one word refutation of that source of supply - Zimbabwe.

and this wouldnt apply, to say steel? I guess can we can toss out the WTO, and most trade liberalization of the last few decades, then. Y'all will have to leave the EU while youre at it.

[Kidlicious]

Originally posted by lord of the mark
I think y'all need to clarify if the local market is big enough to impact the world market, or if the world price is a given.

If the latter, than Ps represents the price domestic suppliers recieve - it cant be the price domestic consumers pay, which cant be higher than the world price plus transport costs, since the world market represents a perfectly elastic source of supply.

If you accept Pw as the initial condition you have to accept the world price as a given, but I think we are all assuming that removing the subsidies will affect the world price.

[lord of the mark]

Originally posted by Kidicious


If you accept Pw as the initial condition you have to accept the world price as a given, but I think we are all assuming that removing the subsidies will affect the world price.

then dont you have to model the world market? or at least explicitly show the presumed new world price?

[Kidlicious]

Originally posted by lord of the mark


then dont you have to model the world market? or at least explicitly show the presumed new world price?

Yeah, you need a graph for the world market either way.

[Lawrence of Arabia]

first of all, i didnt take this graph off of a website - i made it on photoshop. the graph comes from lecture notes.
secondly, it is a tariff and subsidy graph - either one of those protectionist items can be modeled by it.
finally, a reduction of subsidies would not change world price because world supply is assumed at infinite.

[Kidlicious]

Originally posted by Lawrence of Arabia
first of all, i didnt take this graph off of a website - i made it on photoshop. the graph comes from lecture notes.

The question is, "Will you and several others negatively affected by that recover?"

Originally posted by Lawrence of Arabia
secondly, it is a tariff and subsidy graph - either one of those protectionist items can be modeled by it.

Obviously, you have no idea, because you copied the notes wrong.

Originally posted by Lawrence of Arabia
finally, a reduction of subsidies would not change world price because world supply is assumed at infinite.

So much for the idea that reducing the subsidies will help the thrid world farmer then. If the prices don't increase then he won't get more income.