Agriculture and Rural Employment Agriculture in Bolivia. Price controls consequences in agriculture.
DOI:
https://doi.org/10.35319/lajed.201217140Keywords:
Price Control, Rural Employment, AgricultureAbstract
Price controls are measures that can significantly affect the sectors covered by these policies. Using a dynamic general equilibrium model with stochastic two types of agents: farmers and city dwellers, calibrated to Bolivia, we show that to declines in productivity in agriculture, agricultural rural employment and agricultural production was impaired when there are price controls. Also improvements in productivity in the nonfarm rural sector represents fixed prices lower profits in relation to a mechanism that allows prices to adjust. In a simulation of the policies carried out in 2009 in Bolivia is that they generate imbalances in the markets causing shortages of agricultural products in substantial quantities.
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