fbpx Understanding Agricultural Price Range Systems as Trade Restraints: Peru – Agricultural Products | Harvard Kennedy School

Additional Authors:

  • Mark Wu

Excerpt

Understanding Agricultural Price Range Systems as Trade Restraints: Peru – Agricultural Products. Mark Wu, August 18, 2015, Paper. "An agricultural price range system (PRS) aims to stabilize local prices in an open economy via the use of import duties that vary with international prices. The policy is inherently distortionary and welfare-reducing for a small open economy, at least according to the canonical economic model. We offer an explanation for why a government concerned with national welfare may nevertheless implement such a policy when faced with risk aversion and imperfect insurance markets..." Link