TAILIEUCHUNG - Market imperfections and the choice of agroforestry systems

Market in upland regions is usually imperfect. Unfortunately, the market perfection is a major determinant of the agroforestry systems. The more perfect markets, the better -chosen agroforestry systems. Under imperfect market condition, the agroforestry choices are not based on comparative advantages of the regions and the farms. | MARKET IMPERFECTIONS AND THE CHOICE OF AGROFORESTRY SYSTEMS By Tran Chi Thien . Thai Nguyen University ABTRACT Market in upland regions is usually imperfect. Unfortunately the market perfection is a major determinant of the agroforestry systems. The more perfect markets the better-chosen agroforestry systems. Under imperfect market condition the agroforestry choices are not based on comparative advantages of the regions and the farms. That makes agroforestry choices economically unefficient and environmentally unsustainable. Solutions to a good agroforestry choice are therefore solutions to more perfect market conditions. 1. What is the role of market perfections in agroforestry system selection Agroforestry is the use of trees in farming systems where agricultural crops are either interplanted spatially with forest trees or rotationally planted with them. Agroforestry systems that include the right trees for the right environments can improve soil fertility allow for better watershed management and increase tree diversity in the landscape. Developing such agroforestry systems while the needs of people are more effectively met natural resources. In perfections in markets are the most important determinants of the agroforestry systems. The more perfect markets are the better more efficient and more sustainable the agroforestry systems are. Solutions to develop economically efficient and environmentally sustainable agroforestry systems thus target the improvement of market in perfections -enhancing the equity of access to commodity land and labor markets and access to technology and extension. 2. How are agroforestry systems selected under perfect competitive market conditions . What are major properties of perfect competitive market A perfectly competitive market is an ideal market equitable to everyone. First of all in this market the price mechanism is neutral playing the role of the judge for all economic decisions. All buyers and sellers are price takers.

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