Canada-U.S. pesticide regulation

Because the single major elements of FQPA were: the repeal of the label would be legal in each country, there would Delaney Clause to allow the presence of carcino- be no reason to prevent a farmer from crossing genic compounds in food if the level of presence the border to purchase a specific chemical. [...] Ongoing differences in pesticide prices between 3.3 The theory of price discrimination Canada and the U. S. have resulted in a number of studies to monitor price differentials and to Price discrimination is typically discussed in inter- examine the impact on producers in various mediate microeconomics texts as part of the countries (Taylor and Koo; Taylor and Gray; development of monopoly behavior [...] Again the After the Canadian and American demands are process is repeated for the U. S. Unlike the linear calibrated, we find the effect of imposing arbi- model for which there is a simple analytical solu- trage on prices and quantities in both countries tion once marginal cost is specified, the non- by solving the system of equations consisting of linear model has to be solved by numerical the Ca [...] A higher marginal cost results in shown in Figure 5b (the axis in Figure 5 is scaled a higher demand elasticity at the observed point, for the larger American demand.) which implies the entire Canadian demand func- FIGURE 6 Comparison of the effect of the elimination of price a. Canada b. United States Figure 6 shows what this implies for the optimal context of the political debate over price dif-