- AGRICULTURAL ECONOMICS Journal
- November 2010
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This study looks at international competitiveness of agriculture in the European Union and the United States. The most intuitive concept is that of price competitiveness. We calculate relative prices for 11 member
states of the European Union and the United States for the period
1973&-2002. We assume that markets are perfectly competitive and in
long-run equilibrium, so that the observed price always equals average
total cost, as measured by the cost dual to the production function.
This assumption is used in our calculation of relative competitiveness
and productivity gaps between the European Union and the United States
and in our decomposition of relative price movements between changes in
relative input prices and changes in relative productivity levels.