Can rice farming be laissez-faire? Sure it can!

This week the IHT has an article by Tyler Cowen, whose blog is among the ones in our blogroll, on the problem of rice production, trade and distribution. We already know that rice is becoming expensive and scarce in some quarters. But Cowen suggests that governments are making matters worse by constraining what farmers can store and export.

Cowen’s point is that prohibiting storage (call it hoarding if you like) or exports of rice will just take away farmers’ incentive to produce. They may decide that they simply can’t get the best price for their crops, either today or in the future, and so they won’t plant and harvest as much. If that happens, there will be less rice for everyone.

This is a controversial topic in countries that are worried about feeding their own people, though. Poor countries’ consumers can’t bid as highly as their wealthier counterparts. Rather than banning exports, a country might buy rice for its own people at the international price, or subsidize their consumption so that they can bid against international consumers. But poor countries’ governments may not even have enough money to do that. Should they still keep out of farmers’ business for the good of the world rice supply?

http://blogs.iht.com/tribtalk/business/globalization/?p=706

As per the usual... cluless fuckwits!

Can rice farming be laissez-faire? Sure it can!

Can rice farming be laissez-faire? Sure it can!

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