03-08-2004 04:15									#151
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	03-08-2004 04:27									#152
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quote: Originally posted by Kidicious There is nothing wrong with calling yourself a marxist and thinking outside or marxism. To only stay within a certain ideology is close minded.

There's everything wrong with calling yourself a Marxist while rejecting Marxist analysis. It's dishonest.

	03-08-2004 04:43									#153
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quote: Originally posted by Last Conformist There's everything wrong with calling yourself a Marxist while rejecting Marxist analysis. It's dishonest.

I'm certainly not rejecting Marxist analysis. I know that not one theory alone can explain economics.

	03-08-2004 04:55									#154
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LoA,

What the hell is that graph? You have subsidies as an increase in cost for the suppliers. You just made that up and then tried to prove that it's true, and on top of that you are violating the foundation of your free market argument.

	03-08-2004 05:08									#155
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quote: What the hell is that graph? You have subsidies as an increase in cost for the suppliers. You just made that up and then tried to prove that it's true, and on top of that you are violating the foundation of your free market argument.

hehe, no i didnt make up that graph. and no, subsidies are not an increase in cost for the suppliers. look at it. Ps, which is the price for subsidized domestic goods, pushes the Sdomestic right, so that it passes through D1

	03-08-2004 05:39									#156
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quote: Originally posted by Lawrence of Arabia hehe, no i didnt make up that graph. and no, subsidies are not an increase in cost for the suppliers. look at it. Ps, which is the price for subsidized domestic goods, pushes the Sdomestic right, so that it passes through D1

No. Ps passes through S1. That is the initial condition. S2 is the subsidized goods. That graph isn't used for what we're talking about. It demonstates the increase in subsidies, not the removal. That's why you have it backwards.

	03-08-2004 05:44									#157
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quote: No. Ps passes through S1. That is the initial condition. S2 is the subsidized goods. That graph isn't used for what we're talking about. It demonstates the increase in subsidies, not the removal. That's why you have it backwards.

no, s2 is not the subsidized good. Ps is the subsidized good.

	03-08-2004 05:48									#158
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quote: Originally posted by Lawrence of Arabia no, s2 is not the subsidized good. Ps is the subsidized good.

That's why I thought you made it up. Look, if I pay you to produce something that in effect lowers your costs. Then you will offer to sell your good for less money. If I stop paying you to produce it you will raise your price again. It's very simple.

	03-08-2004 06:11									#159
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quote: That's why I thought you made it up. Look, if I pay you to produce something that in effect lowers your costs. Then you will offer to sell your good for less money. If I stop paying you to produce it you will raise your price again. It's very simple.

i agree totally. as you can see, the number of domestic suppliers at Ps is greater than at Pw. this is because there are more firms that can compete because they are subsidized. when subsidy is removed, the amount of domestic firms competing drops, because they cannot compete with the world price Pw. yeah, price goes up for the domestic suppliers, but since they can no longer compete, they are gone from the system, and are replaced by imported suppliers.

	03-08-2004 06:18									#160
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quote: Originally posted by Lawrence of Arabia but since they can no longer compete, they are gone from the system, and are replaced by imported suppliers.

From an increase in price. Prices drive in more competition and another equilibrium is reached. That equilibrium can not be below the original price. That's absurd.

Here's a proper graph.

	03-08-2004 14:41									#161
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Security of food supplies is also a national security issue. The main reason the UK has supported its agricultural industry for the last 60 years was the German attempts in two world wars to cut the import of food as well as raw materials to the UK.

So anyone opposing agricultural subsidies is a terrorist!!!

As for reliability of third world suppliers, there is a one word refutation of that source of supply - Zimbabwe.

	03-08-2004 19:07									#162
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your graph kid doesnt show what the world price is, or how much imports are being brought in at those prices, so if the world price is below original, getting rid of subsidies will push the price down, since world supply is considered infinite.

	03-08-2004 19:22									#163
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Kid, sometimes I wonder about you. LoA posted a graph which is in just about EVERY macroeconomics textbook and you claim he made it up or its wrong?

	03-08-2004 19:40									#164
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Didn't we already know that Kid has a BS econ degree?

	03-08-2004 19:44									#165
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quote: Originally posted by Kidicious I'm certainly not rejecting Marxist analysis. I know that not one theory alone can explain economics.

Do I need point out that those two sentences contradict one another?

	03-08-2004 19:56									#166
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To us? No.

	03-08-2004 21:12									#167
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quote: Originally posted by Imran Siddiqui Kid, sometimes I wonder about you. LoA posted a graph which is in just about EVERY macroeconomics textbook and you claim he made it up or its wrong?

This graph is the core of classical and neo-classical economics. And it is the main reason why this entire chunk of economics deserves to go to trash.

	03-08-2004 21:33									#168
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quote: Originally posted by Lawrence of Arabia your graph kid doesnt show what the world price is, or how much imports are being brought in at those prices, so if the world price is below original, getting rid of subsidies will push the price down, since world supply is considered infinite.

The only difference in the world price should be transportation costs. When the subsidy is removed prices will increase in the world and in the local market. There is no way that enough suppliers will come into the local market to make the price fall. It's like bouncing a ball. The ball will never reach the height where you bounce it from unless you bounce it off of a trampoline.

	03-08-2004 21:36									#169
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quote: Originally posted by Last Conformist Do I need point out that those two sentences contradict one another?

Well, I'll just have to leave it to you to understand what I'm saying. I don't pretend to be a marxist in the absolute sense. I just call my self one because it's the closest label for me.

	03-08-2004 21:46									#170
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quote: Originally posted by Imran Siddiqui Kid, sometimes I wonder about you. LoA posted a graph which is in just about EVERY macroeconomics textbook and you claim he made it up or its wrong?

It violates the Law of Supply. I did a search on the web and found the graph I posted, nothing of the sort that LoA posted. There is something mixed up about his graph or he is explaining it wrong.

LoA,

You need to provide a link or source at least.

	03-08-2004 22:11									#171
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I think y'all need to clarify if the local market is big enough to impact the world market, or if the world price is a given.

If the latter, than Ps represents the price domestic suppliers recieve - it cant be the price domestic consumers pay, which cant be higher than the world price plus transport costs, since the world market represents a perfectly elastic source of supply.

If the former, than you need to show world supply and demand to complete the analysis.

Last edited by lord of the mark on 03-08-2004 at 22:17

	03-08-2004 22:18									#172
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The graph presented by LoA demonstrates tariffs. I just found it on the net at www.bized.ac.uk. I say he fixed it and tried to pass it off. If he wants to prove otherwise he can give a source.

	03-08-2004 22:27									#173
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quote: Originally posted by Kidicious The graph presented by LoA demonstrates tariffs.

that would make more sense.

	03-08-2004 22:29									#174
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quote: Originally posted by Imran Siddiqui Kid, sometimes I wonder about you. LoA posted a graph which is in just about EVERY macroeconomics textbook and you claim he made it up or its wrong?

surely you meant MICROeconomics?

	03-08-2004 22:31									#175
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quote: Originally posted by CerberusIV Security of food supplies is also a national security issue. The main reason the UK has supported its agricultural industry for the last 60 years was the German attempts in two world wars to cut the import of food as well as raw materials to the UK. So anyone opposing agricultural subsidies is a terrorist!!! As for reliability of third world suppliers, there is a one word refutation of that source of supply - Zimbabwe.

and this wouldnt apply, to say steel? I guess can we can toss out the WTO, and most trade liberalization of the last few decades, then. Y'all will have to leave the EU while youre at it.

	03-08-2004 22:34									#176
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quote: Originally posted by lord of the mark I think y'all need to clarify if the local market is big enough to impact the world market, or if the world price is a given. If the latter, than Ps represents the price domestic suppliers recieve - it cant be the price domestic consumers pay, which cant be higher than the world price plus transport costs, since the world market represents a perfectly elastic source of supply.

If you accept Pw as the initial condition you have to accept the world price as a given, but I think we are all assuming that removing the subsidies will affect the world price.

	03-08-2004 22:36									#177
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quote: Originally posted by Kidicious If you accept Pw as the initial condition you have to accept the world price as a given, but I think we are all assuming that removing the subsidies will affect the world price.

then dont you have to model the world market? or at least explicitly show the presumed new world price?

	03-08-2004 22:46									#178
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quote: Originally posted by lord of the mark then dont you have to model the world market? or at least explicitly show the presumed new world price?

Yeah, you need a graph for the world market either way.

	03-08-2004 23:01									#179
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first of all, i didnt take this graph off of a website - i made it on photoshop. the graph comes from lecture notes.
secondly, it is a tariff and subsidy graph - either one of those protectionist items can be modeled by it.
finally, a reduction of subsidies would not change world price because world supply is assumed at infinite.

	04-08-2004 00:41									#180
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quote: Originally posted by Lawrence of Arabia first of all, i didnt take this graph off of a website - i made it on photoshop. the graph comes from lecture notes.

The question is, "Will you and several others negatively affected by that recover?"

quote: Originally posted by Lawrence of Arabia secondly, it is a tariff and subsidy graph - either one of those protectionist items can be modeled by it.

Obviously, you have no idea, because you copied the notes wrong.

quote: Originally posted by Lawrence of Arabia finally, a reduction of subsidies would not change world price because world supply is assumed at infinite.

So much for the idea that reducing the subsidies will help the thrid world farmer then. If the prices don't increase then he won't get more income.