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Abstract

For a half-century the parity ratio has served as the most commonly used measure of the effects of relative price changes on the farm economy The authors present a consistent economic model which measures the price-related income effects of relative price changes in selected sectors of the U.S. economy during the 1967-78 period and use this model to analyse selected sectors within the food system Their model improves and expands upon the parity ratio It provides more detailed information within the farm sector, and it provides conceptually consistent measures of the effects of relative price changes in the nonfarm sectors of the food system

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