COMPARATIVE ADVANTAGES AND CROP DIVERSIFICATION - A POLICY ANALYSIS MATRIX FOR THAI AGRICULTURE

This study aims to assess the costs and benefits of the Thai agricultu ral diversification policy in 1994-96. Three competitive crops (rice, soybeans and mungbeans) are selected in two provinces to study their c omparative advantages in terms of a policy analysis matrix. The result s suggest that rice is more profitable than soybeans and mungbeans, im plying that government intervention may incur efficiency losses. Some sensitivity analyses, however, suggest that potential price changes, i ncreasing water scarcity, and the effects of crop production on the en vironment are important concerns which may justify government interven tion.