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© 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

ROBERT G. CHAMBERS and Robert G. Chambers

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.


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