Trends in agriculture's terms of trade

Abstract

In this paper* I propose to discuss in fairly broad terms the factors affecting the prices of agricultural products. This is a matter of importance not only to farmers but also to the nation as a whole since our prosperity is very dependent on the returns we receive for our agricultural export products overseas. However, our interest is not solely with the prices of agricultural products but with the quantity of other imported goods which such products will purchase. More specifically we are interested in changes in the ratio of agricultural prices to prices of non-agricultural goods. The ratio is called "the terms of trade".