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Market shaping instead of blind faith in the market or market subjection!

22 September 2009

More than 40 scientists appeal:In reaction to the most recent developments in the markets and especially with respect agricultural markets, the signatories call in the resolution to pursue a more responsible market shaping in the future.

More than 40 scientists appeal: Market shaping instead of blind faith in the market or market subjection! In reaction to the most recent developments in the markets and especially with respect agricultural markets, the signatories call in the resolution to pursue a more responsible market shaping in the future. The current worldwide economic crisis was triggered by investment banks' speculations. However, its magnitude and its drastic effects were only possible because of the faith in the markets by academia and politics as well as the tendency to create unequal freedoms for market participants in the name of market freedom. Statements by agricultural economists claim “the dairy industry” has “become a free market”. Part of the dairy industry are of course the milk farmers. . However, those were and still are in a highly dependent relationship. They receive a milk price unilaterally and retroactively from the creamery. Therefore, calling it “a free market” is out of the question. The theoretical model of polypolistic supply structures, which confront a large number of buyers, does not have anything in common with practice. The dairy sector has a pyramid structure. Here, the participants differ greatly in their numbers as well as their levels of turnover: About 100,000 dairy farmers face 100 creameries, these again face just a few chains of stores. Within this structure, dairy farmers are dependent commodity suppliers. Hence, the signatories demand: - a responsible, realistic market shaping to make possible the reestablishment of farmers as equivalent market participants, - to stop a unrealistic static conception of markets as a a pricing mechanism is supposed to – are dynamic and therefore have to be regulated constantly, - The preferential treatment of strong market participants, realized through the one-sided reliance on economies of scale (quantity) without the counterpart of an innovative economy creating something new (quality) by which Oligopolies are promoted on and on, - to finish the favoritism of more and more successful efficiency of single firms and at the same time passing on the consequent costs to the whole society - The continuous advancement of the currently operated world trade in agricultural products based on the model of comparative advantage, for which in practice the conditions are absent and by which it to unequal trade in favour of the industrial countries comes with the irresponsible results of the destruction of the subsistence structure in these countries. 70% of the hungry of the world are small-scale farming families and farm laborers! Responsible market shaping – sustainable for the future – appeals not for “more freedom of the market,” but “more freedom for ALL market participants.” The signatories call for an end to the obligatory statements of the “freedom of the markets” without critically questioning them. This is the first step to ending “regulating the markets in the name of non-regulation.” attached the resolution and the list of signatories contact: Prof. Dr. Onno Poppinga rondopopp@t-online.de Tel.: +49 5673/ 3540 Dr. Katrin Hirte Katrin.hirte@web.de Tel.: +49172/ 56 06 009

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