AGRI-FOOD ECONOMICS - MARKETS AND SYSTEMS
Learning outcomes of the course unit
In developed economies the agri-food system is made up by interdependent firms which make a big contribution to national income and trade balance.
The course looks at main constraints on the Italian agri-food system, the evolution of demand for food products, EU policies and WTO regulations on international trade. It then focuses on dimensions and characteristics of the agri-food system with particular reference to contractual and market regulation mechanisms. The course ends with an analysis of information asymmetry which can hamper food product sales and initiatives to counter it.
Course contents summary
1 Food products: Demand and consumption
1.1 Classification of food groups
1.2 Food regimes, spending and demand
1.3 Demand for food
1.3.1 Basic notions of the income : food consumption ratio
1.3.2 Engel spending curves, average and marginal trends of food consumption, elasticity of consumption to income, luxury and non luxury goods
1.3.3 Basic notions of the price-consumption function, direct and in direct elasticity of consumption to price
1.3.4 The compostion of the price effect, the Giffen paradox
1.4 Three main trends in food consumption in developed countries
1.4.1 Food consumption trends in terms of energy
1.4.2 Engel’s law
1.4.2 Change in patterns of food consumption
1.5 Spending on food consumption in Italy: results of an ISTAT survey on household consumption and new models of food consumption.
2 The Agri-food System
2.1 The “Agri-business complex” and the “Agri-food System”
2.2 Role of the Agri-food System in the economy, value chain.
2.3 The Sub-Sectors of the Agri-food System
2.3.2 Food industry
2.3.3 Food distribution
3 Italian foreign trade in agri-food products
3.1 Long term trends of the Italian agri-food foreign trade
3.2 The deficit in the agri-food sector’s share of overall trade
3.3 Structure of Italian agri-food foreign trade
3.4 Success factors from 1990s
4 The marketing of agri-food products and typical products
4.1 The marketing mix for agri-food products
4.2 Prices and asimmetry of information
4.3 Food logistics
4.4 Definition and EC regulations on PDO and PGI products
4.5 Trade marks and the policy of voluntary Consortia for the protection of typical agri-food products
5 Food chain, distribution channel and regulation of agri-food system
5.1 Food chain and distribution channel
5.1.1 Economic function of intermediation and distribution channel
5.1.2 Food chain definition and its components; identification and analysis of regulation mechanisms
5.2 Agri-food markets
5.2.1 Equilibrium in competitive and monopoly markets
5.2.2 Characteristics of agri-food markets
5.2.3 The market of imperfect competition
5.3 Transaction cost economics and contracts
5.3.1 Phases of transaction and cost of goods
5.3.2 Factors affecting transaction costs
5.3.3 Regulating transactions
5.3.4 Contract economics in the agri-food system (contract and vertical integration)
5.3.5 Network economics
6 EU agricultural policy
6.1 Pricing policy under “coupled support”
6.1.1 The European tradition in agri-food sector intervention: protectionism and “deficiency payments”
6.1.2 Formation of the CAP: aims and working of the Common Market Organisation (internal market management, intervention price, threshold prices, variable duties on imports, restitutions for exports)
6.2 CAP Reform and “decoupling”
6.2.1 “Decoupling” the support to agriculture
6.2.2 The 1992 McSharry Reform
6.2.3 The 2003 Fischler Reform
7 The WTO and multi-lateral agreements on agri-food products
7.1.1 WTO objectives
7.1.2 The “Most Favoured Nation” clause and the “National treatment” rule
7.1.3 Multilateral and regional agreements
7.2 The GATT agricultural agreement
7.2.1 Role of agriculture in GATT negotiations
7.2.2 The Uruguay Round
7.2.3 The GATT agricultural agreement: terms
7.3 International agreements on non-tariff barriers
7.3.1 Health barriers
7.3.2 Technical barriers
7.4 TRIPS agreement on GI’s
8 Quality and traceability in agri-food economic
The main readings are the lesson notes from the course and texts selected by the professor.
Materiale didattico per il corso di Economia Agroalimentare (Sistema e mercati), Università degli Studi di Parma, Parma, 2006
Letture consigliate per il corso di Economia Agroalimentare (Sistema e mercati), Università degli Studi di Parma, Parma, 2004
M. SCOPPOLA: Il commercio internazionale dei prodotti agro-alimentari: la posizione e le prospettive dell’Italia in una Europa allargata, Conference proceedings, SIDEA, 2003 .
C. GIACOMINI: L’agricoltura da settore a sistema, in 'Il cibo tra territorio, produzione, alimentazione e cultura', Regione Emilia Romagna, Assessorato Agricoltura, 1996.
R. RONCO: Il processo di integrazione dell’agricoltura, in IRER 'L’integrazione verticale per contratto', 1996.
R.H. GREEN, R. ROCHA DOS SANTOS: Economia di rete e ristrutturazione del settore agroalimentare, in 'La Questione Agraria', n.52, 1993.
G. MAROTTA, M.A. PERITO: Canali distributivi e modelli organizzativi: una prospettiva di sviluppo per i mercati ortofrutticoli all’ingrosso, in 'Rivista di Economia Agraria', n.3, 2000.
All essential readings are available from the Photocopy service, Economics Faculty (6, Via Kennedy, Parma).
The exam consists of open ended written questions.