Get Agricultural Household Models: Extensions, Applications, and PDF
By Professor Inderjit Lyn Singh
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Additional info for Agricultural Household Models: Extensions, Applications, and Policy
An increase in the price of an important agricultural staple will obviously hurt households that are net consumers of that item. The direct effect of a price increase will therefore be unambiguously negative for landless households and nonfarm households.
Policymakers are also concerned with the welfare of rural households Landless households either that do not own or rent land for cultivation. sell their labor to land-operating households or else engage in nonfarm activities (see, for example, Anderson and Leiserson 1980). Although governments have few policy instruments by which to improve the welfare of these households directly, price interventions and investment programs directed at land-operating households have spillover effects that may (or may not) be beneficial for these households.
The percentage change in real income among the six countries under consideration is less than the percentage change in either the output price or the fertilizer price (table 1-4). In addition, it appears that the loss in real income arising from a given percentage reduction in the output price can be offset only if the price of fertilizer is reduced by a much larger percentage. In Malaysia, for example, a 10 percent reduction in output price whereas a 10 percent rewould reduce real income by almost 7 percent, duction in the price of fertilizer would increase real income by only about 1 percent.
Agricultural Household Models: Extensions, Applications, and Policy by Professor Inderjit Lyn Singh