© 1983 Oxford University Press and the Foundation for the European Review of Agricultural Economics
research-article |
International trade, gross substitutability and the domestic farm-retail price margin
University of Maryland USA
University of Maryland College of Agriculture College Park Maryland 20742 U.S.A.
Received March 1, 1982; final version received December 1, 1982
Summary
The effect of international trade and governmental intervention on the farm-retail price margin (ratio) is examined in a two country, one commodity, two factor framework. Both theoretical and numerical approaches are used in the paper's analysis. It is found that the farm-retail price margin is sensitive to governmental intervention in the international pricing mechanism as well as to the degree of gross substitutability between inputs.