Chapter 5


Figure 5.2: Impacts of policy measures to reduce the costs of food production


 requirements
 old
 demand production
 /domestic supply






 -- I
 p------------- -- -

 > volume


Figure 5.3: Impacts of policy measures to alleviate constraints to food production
 shift .
 oeshift requirements

 old
 demand I production
 /domestic supply
 / new





 Ip----------------------

 B > volume


 The effects on the volume of food production, supply, demand and on the overall structure of
 the food deficits are similar in both cases:

 the volume of food production and domestic food supply will expand (from A to B);

 the volume of aggregate food demand will expand as well (from A to B);

 the market price will fall (from p to p');

 the production, supply and demand deficits will diminish from R-A to R-B.


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