This paper analyzes food price stabilization policies in a small, open, developing country. Without public intervention, price dynamics are driven by domestic productive shocks and international prices. Trade and/or storage policies are optimally designed to increase welfare, in a context where...

This article compares different policies in a rational expectations storage model with risk-averse consumers and missing insurance markets calibrated to represent a developing country. We consider an optimal storage policy under discretion and two optimal simple rules, a constant private storage...