MARKETING BOARDS AND QUOTA POLICIES FOR CANADIAN FARM PRODUCTS: AN APPRAISAL OF PERFORMANCE*

Since the great economic Depression, Canadian farm operators have always emphasized the need to strengthen their bargaining position in the market place. Basically, farm operators believe that the individual farmer is in no position to bargain effectively in a product market with a few large firms.
Legislators have responded to the wishes of farm operators by enacting legislation which provides for the formation of compulsory marketing boards controlled by producers. An ever-increasing number of these boards are now in operation. The granting of exclusive powers to sell particular farm products, however, is one which involves the public interest and the public is, therefore, vitally interested.
This paper focuses attention on the exercise of the powers vested in these marketing boards through their use of quotas, and their limitations to entry of new producers into particular sectors of the agricultural industry. The paper indicates that there are some positive features to the quota policies pursued by marketing boards. Some economic security has been afforded farm operators with short-term stability engendered in particular sectors of agriculture. There are certain negative consequences of these quota policies, which affect the location of production and also impair the competitive strength of particular sectors of agriculture to which they are applied. They have also interfered with the most rational utilization of resources in associated industries. These aspects of the quota policies are, therefore, inconsistent with the public interest. The study outlines principles that should form the basis of a revitalized marketing policy that may be more consistent with the public interest.