Cutting up cotton subsidies?

It’s that time of year again when we’re looking at different markets in AS Microeconomics, and once more trade-distorting subsidies are back in the news- this time in the cotton markets

With massive subsidies from both the US and EU governments, it’s increasingly difficult for African producers to compete with their rich-world neighbours. The short BBC News video below explains clearly the problems faced by those farmers and also the arguments put forward by the American government, providing an excellent background to a short discussion on this controversial topic. This article offers a more in-depth analysis of the situation.

There is an excellent supporting article here in the Guardian: Cotton subsidies costing west African farmers £155m a year, report reveals