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We estimate the influence of policy-induced price changes and of technology supply on North Carolina flue-cured tobacco yields. The decline in land rent and effective output price that accompanied a 1965 policy change from acreage allotments to poundage quotas caused a 12 percent decrease in yields. Farmer yields were more responsive to yield-increasing technologies under acreage allotments than under poundage quotas. Annual yield growth was 0.5 percent under poundage quotas and 4.32 percent under acreage allotments. The growth rate decline is attributable to changes in relative prices and to a slowdown in the supply of available technologies.

Many commentators have claimed that farm subsidies have contributed significantly to the “obesity epidemic” by making fattening foods relatively cheap and abundant and, symmetrically, that taxing “unhealthy” commodities or subsidizing “healthy” commodities would contribute to reducing obesity rates. This paper makes three contributions. First, we review evidence from the literature on the impacts on food consumption and obesity resulting from subsidies applied in the past to production or consumption of farm commodities. Second, we develop and present new arguments and preliminary evidence on the impacts of past government investments in agricultural R&D on food consumption and obesity—through research-induced increases in agricultural productivity and the consequences for prices, production, and consumption of farm commodities. Third, we consider and compare the economic efficiency of hypothetical agricultural research policies (changing the orientation of agricultural research investments) versus hypothetical agricultural commodity subsidies and taxes as alternative mechanisms for encouraging consumption of healthy food or discouraging consumption of unhealthy food, or both.

Following Weitzman (1974), there is ample theoretical literature indicating that choice of pollution control instruments under conditions of uncertainty will affect the expected net benefits that can be realized from environmental protection. However, there is little empirical research on the ex ante efficiency of alternative instruments for controlling water, or other types of pollution, under uncertainty about costs and benefits. Using a simulation model that incorporates various sources of uncertainty, the ex ante efficiency of price and quantity controls applied to two alternative policy targets, fertilizer application rates and estimated excess nitrogen applications, are examined under varying assumptions about agricultural income support policies. Results indicate price instruments outperform quantity instruments. A tax on excess nitrogen substantially outperforms a fertilizer tax in the scenario with support programs, while the ranking is reversed in the scenario without support programs.

SUMMARY The concentration of recent discussion on Commodity Agreements neglects two other approaches to the reform of trade patterns—the structural approach (shifting the distribution of the gains from trade by changes in the whole structure of production financing, transport distribution) and compensatory finance schemes. The last are more attractive to the industrial countries (because of the possibility of ‘cost‐free’ financing through IMF gold sales or the Link and the diffusion of the burden): as such they are more feasible, and have, also, attractions for the developing countries. (They can cover weak as well as strong commodities, payments go to governments and not to—possibly wealthy or MNC subsidiary—producers). They may offer the best hope for developing countries if the latter insist on three conditions: stabilization of export earnings in real terms; a significant degree of control over the schemes' operation; payments in the form of grants not loans particularly to the poorer countries. RESUMEN Mas Alla de la Politica de Productos Primarios: Cambios Estructurales y Compensacion Financiera La concentracion de la discusion reciente sobre Convenios de Productos Primarios descuida otros dos enfoques de la reforma de los padrones de comercio : el enfoque estructural (cambiar la distribucion de las ganancias del comercio por medio de cambios en la estructura global de produccion, financiamiento, transporte y distribucion) y los esquemas de compensacion financiera. Los ultimos son los mas atractivos para los paises industriales (debido a la posibilidad de financiamiento sin costo a traves de ventas de oro del FMI, o del lazo con los DEG, y la reparticion de la carga financiera) ; en esa medida son mas factibles y tienen ademas atractivos para los paises en desarrollo. (Pueden cubrir tanto productos debiles como fuertes, los pagos van a los gobiernos y no a productores ricos o incluso subsidiarias de las CMN). Estos esquemas pueden ser los mas promisorios para los paises en desarrollo siempre que estos insistan en tres condiciones: estabilizacion de retornos de exportacion en terminos reales: un grado significativo de control sobre el funcionamiento del esquema ; y pagos en forma de ayuda, no de prestamos, especialmente a los paises mas pobres. RESUME Nouvelles approches des produits de base Les discussions recentes s'attachant aux accords sur les produits de base negligent deux aspects particuliers relatifs a la reforme des modeles commerciaux, notamment (1) la question structurelle (nouvelle repartition des benefices de commerce en vertu de changements apportes a l'ensemble des procedures de production, financement, transports, distribution) ; (2) les projets de financement compensateur. Ces projets plaisent le plus aux pays industrialises (en raison (a) des possibilites de financement “gratuit” qu'ils presentent grâce aux transferts de ressources a partir du FMI, provenent soit de la vente des reserves en or soit du “Lien ', (b) de la repartition du fardeau). Ces projets peuvent s'appliquer a de produits a faibles et a forts revenus. Les paiements se versent aux gouvernements, et non aux producteurs (eventuellement riches, ou filiales de societes multinationales. Ils peuvent offrir la meilleure reponse aux aspirations des pays en developpement, pourvu que ces derniers exigent (1) que la stabilisation des recettes d'exportation s'effecture moyennant de ressources reelles; (2) que la mise en oeuvre des projets soit assujettie a un controle adequat ; (3) que tous les transferts se fassent a titre de subventions et non de prets, et ceci surtout vers les pays les plus demunis.

Economists have long been questioning the usefulness of the traditional, highly regulatory international commodity policy. In recent years, the failure of this policy has become evident. Could price and earnings stabilisation through price risk management instruments represent a viable alternative?

Debate for the 1995 farm legislation ranged from minor reform of existing programs to fundamental reform of U.S. agricultural policy. This report discusses some issues addressed, including who benefits from commodity programs, whether the benefits are capitalized into land values, the costs of agricultural programs, how well programs have worked, who bears the risk in the agricultural sector, and whether alternative programs might work to meet farmers' needs.

United States dairy policy includes both predatory and productive components. The milk price support program is designed to transfer income to dairy farmers while research and extension expenditures are designed to increase social welfare. The purpose of this chapter is to provide an empirical example of the theory developed in Chapter 4.

This paper analyzes restrictions on agricultural chemicals in the US and EC under various farm commodity policy scenarios using a partial equilibrium simulation model. The model has three regions (US, EC, rest of the world) and four commodities (wheat, corn, coarse grain, soybeans). Medium- and long-run impacts are derived. Given existing farm programs, US landowners gain from chemical restrictions while EC ·1andowners generally lose. Given bilateral elimination of farm programs, both US and EC landowners gain from chemical restrictions. Bilateral farm program elimination without chemical restrictions induces a shift in chemical usage from the EC to the US.

United States dairy policy includes both predatory and productive components. The milk price support program is designed to transfer income to dairy farmers while research and extension expenditures are designed to increase social welfare. The purpose of this chapter is to provide an empirical example of the theory developed in the previous chapter. It has long been recognized the government research and extension policies have been significant contributors to technological advance in agriculture (Evenson and Kislev 1976, Evenson, Waggoner, and Ruttan 1979). The advent of technological change on agriculture and its policy implications was first noted by Schultz (1945, 1953). Some, like Cochrane (1958) in characterizing his famous technological treadmill thesis, argued for price supports in order to compensate farmers for the adverse effects of research on farmers' welfare. Indeed, commentators like Thurow (1981) and Schlesinger (1984) argue that public good provision in agriculture is one of the few major economic success stories of government intervention in the history of the United States. Nevertheless, one of the most stylized facts in government policy intervention in agriculture is the pervasive level and overwhelming evidence of underinvestment in public research (Ruttan 1982). Concomitant to this notion, economists have alleged that governments 'overinvest' in commodity policies because of the associated deadweight losses generated.

This paper concentrates on a critique of international commodity policy from a non-neoclassical perspective. It is argued that, despite the formulation of international commodity policy in UNCTAD and NIEO in terms of broad perspectives for major structural and institutional change, both the theoretical weakness of the formulation of the proposals and the realities of relatively weak bargaining power of Third World countries have led to negotiation almost exclusively in terms of narrowly defined price objectives. The discussion of the theoretical weaknesses is illustrated with reference to simulation studies of commodity markets and empirical evidence on terms of trade movements. It is argued that the UNCTAD/NIEO policies proposed are unsuitable for and unlikely to achieve the desired ends. The final section of the paper examines briefly and finds in the literature on ‘unequal exchange’ a possible hidden rationale for the indexation aspects of UNCTAD/NIEO policy. The paper concludes that the discussion of international commodity policy to date remains outside the realm of serious appraisal of the operation of the world capitalist system and the possibilities therein for major structural and/or institutional change.

SUMMARY The slow progress in the implementation of UNCTAD's Integrated Programme for Commodities (IPC) since its establishment in 1976 has given rise to doubts about the merits of international commodity policy, especially as discussed in UNCTAD. The main reason for slow progress is the lack of political will in member countries. There are also some missing links in commodity policy to be pursued by the international community. RESUMENPolitica internacional sobre productos basicos en el sistema de la ONU: dos decadas de experiencia La lentitud con que se ha realizado el Programa Integrado para Productos Basicos (PIPB) de la UNCTAD desde su creacion en 1976 ha dado lugar a dudas sobre los meritos de una politica internacional sobre productos basicos, tal y como ha sido definida en la UNCTAD. La razon principal de esta lentitud es la falta de voluntad politica de los paises participantes. Y la comunidad internacional se halla demasiado desconectada para Ilegar a una politica comun sobre productos basicos. RESUMESLa politique internationale des produits de base dans le systeme des Nations Unies: deux decades d'experience Le lent progres dans la mise en oeuvre du Programme Integre pour les Produits de Base de CNUCED depuis son etablissement en 1976 a souleve certains doutes sur les avantages de la politique internationale des produits de base, surtout telle que mise au point par CNUCED. La raison principale pour le lent progres est le manque de volonte politique dans les pays membres. Il y a aussi quelques points manquants dans la politique des produits de base a etre developpee par la communaute internationale.

tential of U.S. agriculture will be needed to In exploring the commodity policy issues for meet the anticipated level of demand. the 1980s, we keep in mind how those issues are related to the ability of the policymaker to FACTORS RAISING POLICY ISSUES OR develop policy instruments for influencing sup- AFFECTING POLICYMAKER DECISIONS ply and demand. The next section summarizes the current thinking pertaining to aggregate Aggregate Production Capability supply and demand in the 1980s. With that background, we discuss several issues that are There is a school of thought that the United likely to arise or that will be factors affecting States has reached relative resource equilibp9licymaker decisions. Specific commodity ob- rium in its agricultural plant. The view is that servations follow. In conclusion we examine the United States no longer has a latent rewhat the identified issues or factors could serve available to provide an "immediate" promean for different groups affected by commod- duction response to a short-supply situation. ity policy.

German and European businesses are highly dependent on metals. Demand for these raw materials is expected to grow even further as they will be needed for the green energy and electric mobility tran­sition, digitalisation and other emerging technologies. Geopolitical developments influence security of supply. China's central role in mineral supply chains is a major factor of uncertainty in this con­text. The European Union has set ambitious sustainability targets. Implementing these in complex multi-tier metal supply chains is no easy matter, given the magnitude of environmental and human rights risks. Nevertheless, sustainability should not be sacrificed for security of supply. Instead, the European Union should pursue a strategic raw materials policy that reconciles the demands of both. The two biggest challenges in sustainability governance are: firstly, the diversity of standards and their inconsistent implementation and enforce­ment; and secondly, power asymmetries and lack of transparency along metal supply chains. A sustainable raw materials policy must seek to reduce dependency through strategic diversification and partnerships with countries that share European values. Transparency-enhancing measures and a regu­latory "smart mix" will be decisive elements. (authors's abstract)

Costs and effects of commodity price stabilization will depend on private price expectations, and these price expectations do respond to changes in public policy. Past empirical studies assumed that price expectations did not incorporate policy constraints on price. The following article examines the implications of correcting this weakness in earlier studies. Substantial differences in estimates of stabilization con result from this improvement in methodology.

The author reviews the issues and problems which have arisen since May 1976, following the fourth meeting of the United Nations Conference on Trade and Development (UNCTAD). He concludes that prospects for agreement between the developing countries in the Group of 77 and the industrialized West are slight unless there is substantial modification of position by either side.

HOW IS THE EEC TO REACT TO THE UNCTAD DEMAND FOR AN INTEGRATED commodity programme? In this paper we attempt to sketch the background to this question and to identify some of the major options available to the Community. At the outset, however, one point deserves emphasis: over the past fifty years there have been many attempts to manage international commodity trade. Their success or failure has invariably depended more on political than purely technical considerations. Where national security or alliance needs ‘demanded’ coordination, as with the combined Raw Materials Board during the Second World War, any technical difficulties were overcome; on the other hand the inter-war rubber, wheat and coffee agreements were unable to withstand the onslaught of the depression, the retreat to economic nationalism, and the readiness of many members to put short-term domestic considerations before long-term international commitments. In the current debate the political context has, of course, changed, but the relevance of these political considerations has not.