Trade: Senseless self-sufficiency

The recent surge in global grain and most other food prices raises some interesting questions for China. The evidence suggests that price volatility in international markets reflects the low level of trade in many foodstuffs. However, many countries have responded by striving for self-sufficiency, at least in grains.

Thus Malaysia, the world’s leading exporter of palm oil, is planning to increase subsidies to its inefficient rice farmers to reduce import dependence. The illogic ...

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