Origin of Production Shocks, Agricultural Price Spikes and Trade Policy. (19th April 2018)

• Record Type: Journal Article
• Authors: Yan, Wenshou; Deng, Guoqu
• Is Part Of: Manchester school. Volume 87:Number 1(2019)
• Page Start: 81
• Page End: 102
• Publication Date: 2018-04-19
• Subjects: Economics -- Periodicals; Social sciences -- Periodicals; Economics -- Sociological aspects -- Periodicals; 330.05
• DOI: 10.1111/manc.12219
• Languages: English
• ISSNs: 1463-6786

Abstract

Abstract : This paper incorporates exogenous production shocks into short‐run policy making process, and altruism is introduced into government utility functions under cooperative policy making scenario. The results reveal that the noisy signal from production shocks and government's self‐interested behaviors consist of the main barriers to make cooperative trade negotiations between agricultural importers and exporters. Finally, the project puts forward that domestic public storage policy is a feasible way for storable agricultural products to buffer production shocks and to stabilize domestic price in the context of agricultural price fluctuations with high frequency, and limited function of the WTO with respect to restricting governments' trade policies.