Measuring national interests in the international coffee agreement
This article shows how national interests in price-changing international commodity agreements can be measured. Two approaches are distinguished. Firstly, changes in national interests can be measured that are caused by the introduction of an international commodity agreement in an otherwise unregulated world market. This approach is based on a comparison of the situations with and without a commodity agreement. It represents a positive approach to measuring national interests. Secondly, changes in national interests can be measured that result from the individual country's decision to participate in the agreement or to stay outside. This approach compares the situation of participation with that of non-participation in an existing commodity agreement. As the consequences of a national decision are analyzed, it is a normative or decision-oriented approach to measuring national interests. The ICA is a particularly interesting scheme to show the two approaches, as some countries participate in the agreement while others do not. This has led to the co-existence of a controlled and an uncontrolled market with different prices.
Uncontrolled prices on a market with supply control
Abstract It is investigated in this article how a price-increasing supply control measure on a regulated market influences the price on a parallel, non-regulated market. Determinants of the net impact, including the rigidity of quota policy, are elaborated.
The equivalence of quotas and buffer stocks as alternative stabilization policies
Abstract The choice of an optimal policy when the foreign supply curve is unstable has been considered separately in two earlier articles. Both authors have shown that price stabization is welfare increasing if a tariff set for noneconomic reasons is above 100 percent. The fact that both achieve the same result despite the choice of different stabilization measures is taken up in this article. It is found that price stabilization through quotas or buffer stocks will have the same effect on economic welfare despite their differing impact on the level of imports under varying supply conditions.