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The Economics Of Agricultural Policy

Submitted by rca2003 on December 4, 2005

Category: Business
Words: 2792 | Pages: 12
Views: 223
Popularity Rank: 50,725
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Abstract
Because agriculture makes up over nine percent of world merchandise trade, it is no surprise that agricultural issues are very important to a lot of people. There are many issues currently affecting the world agricultural market. One of the largest debates is over the use of agricultural subsidies and whether the effects are beneficial or detrimental to the agricultural market. Another issue is the prevalent practice of genetically engineering agricultural products. There are valid arguments both for and against this practice as it can be very beneficial to impoverished nations but the risks related to its use are still largely speculative and unknown.

The Economics of Agricultural Policy
Because agriculture makes up over nine percent of world merchandise trade, it is no surprise that agricultural issues are very important to a lot of people. There are many issues currently affecting the world agricultural market. One of the largest debates is over the use of agricultural subsidies and whether the effects are beneficial or detrimental to the agricultural market. Another issue is the prevalent practice of genetically engineering agricultural products. There are valid arguments both for and against this practice as it can be very beneficial to impoverished nations but the risks related to its use are still largely speculative and unknown.
Agricultural subsidies are defined as "financial assistance to farmers through government-sponsored price-support programs" (Columbia Encyclopedia, 2001). Beginning in the 1930s most industrialized countries developed agricultural price-support policies to reduce the volatility of prices for farm products and to increase, or at least stabilize, farm income. In food-exporting countries, such as the United States and France, agricultural subsidies have been designed primarily to increase farm income, either by raising the long-term level of prices above free-market levels or by...

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