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Distortions to Agricultural Incentives in Europe's Transition Economies. Edited by K. Anderson and J. Swinnen. Washington DC: World Bank (2009), pp. 379, US$39.95. ISBN 978-0-8213-7419-1.

Published online by Cambridge University Press:  18 September 2009

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Abstract

Type
Book Review
Copyright
Copyright © Cambridge University Press 2009

‘Europe’ in this book extends east from the new EU member states (excluding Cyprus and Malta), Ukraine and Turkey to Russia, Kazakhstan and the Kyrgyz Republic. For the 18 countries of this region, the subject matter – in eight chapters written by several leading experts in the field – is the nature and effect of agricultural protection and taxation policies since the 1990s. These measures include not only direct taxes, subsidies and quantitative restrictions on food production, consumption, imports and exports, but also non-agricultural policies such as foreign-exchange restrictions. Any of these may affect farmers' incentives in terms of returns or costs, and impose on society an economic cost, whose extent is measured in this book via estimated ‘rates of assistance’ – essentially, price differences – for a wide range of farm commodities.

In addition to producing useful country-by-country summaries of the relevant policy developments, the authors find that over the past two decades agricultural incentive distortions have generally been reduced, though ‘rent extraction’ for government revenue remains, e.g. from cotton in some Central Asian countries, along with problems such as land market restrictions, oligopsonistic processing, poor price transmission and information, inadequate infrastructure, crisis interventions and, sometimes, sheer corruption. Further policy improvements often face major barriers of domestic politics, but EU membership (or possible accession), and international institutions such as the International Monetary Fund, the World Bank and the World Trade Organization, may well help. Extensive notes and references to each chapter make this book a good basis for those investigating these less-than-familiar and sometimes unstable countries.