Showing papers on "Purchasing power published in 1975"

The Commonwealth Caribbean.

Abstract: The Commonwealth is comprised of Guyana and Belize on the mainland and the islands of Jamaica Trinidad and Tobago Barbados Dominica St. Lucia Grenada St. Vincent Montserrat Antigua and St. Kitts-Nevis-Anguilla all of which make up the Carribean Community and the Common Market (CARICOM). The 10-island complex within CARICOM is discussed. The islands on the average have a high population density and most of their land area is agricultural. However distribution is skewed such that small farms (less than 5 acres) account for 79% of the total number but comprise only 13% of the total farmland area. 70% of the population is rural 33% of the labor force is engaged in agriculture and 14% of the GNP comes from agricultural production. Historically agriculture has been organized as estate or plantation usually on better lands growing a single crop for export; or as small subsistence level. The emphasis given export crops has meant that the agricultural sectors in the territories have not been able to provide for their own needs necessitating the importation of food. Despite diversely sponsored attempts to stimulate and diversify agricultural production the sector has remained relatively stagnant or is declining. Farming is generally looked down on by the young and educated large numbers of whom migrate to urban areas. High population densities the existing tenure system and unavailability of good quality land further aggravate the problem. Steep declines in mortality in recent years coupled with continued high fertility and limitations imposed on external migration have resulted in very high growth rates i.e. between 2-3% in the last 2 decades. The age structure is becoming increasingly weighted toward the young. Family planning has been introduced and has received fairly widespread acceptance. Unemployment resulting from a potential labor force growing faster than job creations reduces personal and national income and eventually the level and quality of government services. Malnutrition is common as many families cannot afford to buy imported food. Tourism has been an important industry but seems to be declining and has been criticized because it is largely foreign-owned and accelerates rural outmigration. Unemployment could be countered by promotion of owner-operated family-sized farm units that make use of selective intermediate technology that will not be labor displacing. Such a program could also diversify the agricultural economy make more intensive use of the land provide a more egalitarian society and improve local demand for domestic commodities due to enhanced purchasing power of farmers. Many imported foodstuffs if locally grown could be semi- or completely processed locally thus providing more jobs.

Agricultural Economics as an Aid in Management Decision Making

Abstract: The subject of this paper is the contribution of the agricultural economics profession to the management decision process in agribusiness firms. It covers the importance of agricultural economics training in management, as well as the importance of agricultural economic research including in-house and university programs. My frame of reference is experience with an international marketing firm dealing with processing, domestic distribution, and exports. My bias should be understood-not that I am a complete captive of my environment, but I am looking at this primarily from the point of view of a firm with a strong applied research staff. Consequently, the need for applied research conducted at the university is less evident to me than if I were in a firm without such capability. The importance of agricultural economics training to the decision maker should be evident. The primary function of an agribusiness marketing firm is the allocation of food and fiber from the time of harvest throughout the ensuing year or even years, and it seems imperative that the decision makers in such firms be trained in the basic concepts of economics. The marketing decisions, especially in food, must cope increasingly with a more sensitive worldwide production and demand. Insulative stocks that can forgive bad marketing decisions no longer exist and marketing decisions must call upon the best theory, information, and analysis possible. The prospects for economic recovery in various countries around the world, the prospects for inflation, and the translation of this into purchasing power, and effective demand for basic agricultural raw materials can be best understood by those trained in the rigors of economic principles. The amount of training and where and how the individual receives his training is not nearly as important as the type and quality of training the individual receives. The type of training refers to basic principles versus applied "how to" courses. The quality of training refers to the capabilities of the instructor and the priorities placed on teaching by the colleges. Training is most useful when the individual is introduced to basic concepts that broaden his learning horizons. Marketing courses that stray too far from basic principles do not, in my opinion, contribute as much to the education of people we think will be successful in our firm as do courses which concentrate on basic tools that can be applied to endless types of situations. The successful economists in agribusiness today must have a firm understanding of economic principles, be able to relate those principles to the day-to-day problems, and be able to think, reason, debate, communicate, and work in harmony with those around him. This training can best be done by specialists in the art and science of teaching who are attracted, rewarded, and held in the teaching profession and not by research assistants or teaching assistants or high powered researchers who are obligated to carry a certain teaching load. The greatest contribution of the agricultural economics department in the United States today, by all odds, has been and continues to be education and development of the scientific and managerial talent that has subsequently contributed to the strength of the U.S. economy. This may or may not be fully understood by our colleges or the legislation supporting college funds today. The popular slogan, "publish or perish," is an indication that it may not be as well understood as it should be.

The "Paradox of Bliss" and Money As Net Wealth: Comment

Abstract: In a recent paper [5], Professor Harry Johnson attempted to show that there will be an underestimation of wealth if conventional methods of calculating and comparing it were adopted in a money economy. He argues in two stages, so to speak. The first is that wealth will be underestimated if no value is imputed to money and thus wealth represented by money is zero, by definition. The second is that even if the appropriate imputations (i.e., equal to the marginal yield in the alternative use of the purchasing power represented by money) were made, there will still be an underestimation of wealth if the consumers' surplus, generated by money when treated as a consumers' good, and an analogous surplus, when treated as a producers' good, were not taken into account.

Income Redistribution and the Transfer Problem

Abstract: cannot dominate it, in the sense that there is an improvement in the real income of the transferor, provided that the initial free trade equilibrium is stable (cf. Samuelson, 1941, and Mundell, 1968, pp. 1721). Recently, Harry Johnson and I referred to the analogy between the transfer of purchasing power between countries in the world economy and the transfer of purchasing power between factor-owners in a closed economy (Krauss and Johnson, 1974, Chapter IV). In this case of internal income redistribution in a closed economy, it is also true that the transferor cannot gain net if the general equilibrium adjustment is favourable to its factors of production, provided the initial closed economy equilibrium is stable. The Krauss-Johnson analysis raises an interesting question: would it still be true that the transferor could not gain net when the initial equilibrium is stable if the internal income redistribution between factor-owners were to be effected in the context of an open rather than a closed economy, when the country in question possessed unexploited monopoly-monopsony power in international markets under free trade? The answer is no. The reason is that the initial position of the economy within which the transfer takes place is not Pareto-optimal when there is income redistribution between factor-owners in an open economy with monopoly-monopsony power in international markets; hence, if the income redistribution increases potential welfare, it is possible for the transferor to be at least no worse off and for the transferee to gain when the initial equilibrium is stable. This is in contrast to both the closed-economy case and the case when there is a redistribution of purchasing power between countries from free trade, where the initial position of the economy within which the transfer takes place is Paretooptimal (the relevant economy being the world in the latter case), so