over the last three decades, government intervention had negative effects on the producer prices (and hence, the output and export earnings) of wheat, rice, and cotton in pakistan. these outcomes were the result of a strategy designed to keep domestic food prices low and to build up the country's industrial sector by protecting it from overseas competition. the customary justification for intervention has been that it kept prices stable, particularly for consumers, who paid substantially less than world prices for wheat, rice, and cotton in the 1960s and 1970s. pakistan's policies, however, depressed the prices received by farmers, resulting in depressed farm production the study also reports that, over the long run, total price intervention may have led to a very substantial reduction in foreign exchange earnings. in the 1980s, intervention in agricultural prices in pakistan was greatly curtailed. the exchange rate became more realistic, and domestic prices for the crops discussed in the study were allowed to rise to world levels