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Did Speculation Affect World Rice Prices?

Year of publication 2009

Author C. Peter Timmer;Agriculture and Economic Development Analysis Division

Product type Document

Series title FAO Agricultural Economics Working Paper

Edition 1

Synopsis (short abstract) How much did speculation affect the formation of rice prices during the rapid escalation of prices in world markets late in 2007 and early in 2008, through what mechanisms, what will happen as these influences unwind, and how is the story for rice different from other commodities? To answer these questions, this paper addresses four separate topics, each linked to the others by basic mechanisms of price formation. Simple supply and demand models are a start. The difference between short run re sponses to prices changes, and those responses after full adaptation is possible in the long run, is crucial and the conceptual model highlights the importance of these differences for understanding current prices. History matters.

Language English

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