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Abstract
Agricultural products are normally
underpriced and many types
of urban production subsidized in
developing countries. In developed
countries agriculture normally
shares in the system of subsidies,
and in developed countries
without comparative advantage in
agriculture many farm products are
overpriced. The explanation for
this difference is related to opportunities
for collective action. In
developing countries, conditions
are not favorable to collective
action by farmers. In contrast, collective
action is easier in developed
countries, and protection
makes possible large subsidies to
agriculture in those countries with
relatively little good land in relation
to population.