Economic farm subsidy incidences in the presence of Bertrand competitors of complementary factors of production: A theoretical and experimental approach.

摘要

The identification of factors contributing to the farmers' non-retention of subsidy dollars is key in identifying the impact of the subsidy within and across the sector. Relaxing the assumption of perfect competition, amongst input suppliers, allows for an analysis of two upstream of complementary goods. Because it is the case that the farmers are price takers for some inputs (seed) and may negotiate over the price of others (land), I assume the upstream input providers are more akin to Bertrand competition. General findings, from the theoretical and experimental results, indicate upstream market power as having a significant impact on the economic subsidy incidence; and the complementary between the famer's inputs is the main driving force of the results.