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Wage-price guideposts were part of the government's economic policy from 1962 to 1968. A particular method of policing the guideposts evolved during this period. The Administration sought, through public and private confrontations, to influence the pricing decisions of firms. The document describes briefly the policy of confrontation, proposes several alternative hypotheses to explain the resultant behavior of firms, and analyzes statistically those variables predicted to be associated with government success and failure in influencing firm behavior. (Author)

The coffee industry in Colombia has a continuing production surplus that is of great policy concern to the government. This memorandum formulates an econometric model of the supply of Colombian coffee to use in estimating how the coffee industry would respond to price incentives to lower production. Empirical results obtained from the model suggest that (1) changes in price do not affect the intensity of harvesting, (2) there are lags of 5 years between price changes and 7 years between production changes, and (3) the elasticity of coffee supply with respect to price is about 0.5. These findings imply that a 20 percent reduction in producer prices would lead to a 10 percent reduction in coffee production, but only after 7 years. (Author)