What are the influences on the provision of a good or service that create a decrease in supply?

Answer:
A shift in supply means that the whole supply curve shifts to the left or right. A shift to the left means that producers are willing to supply fewer goods to the market at each price level.

Influences that cause a shift to the left (a decrease) in the supply curve are listed below.

1. An increase in the price of one or more inputs to production
   For example, due to a drought, a shortage of tobacco develops on farm markets. This shortage will move the supply of cigarettes to the left. The imposition of a significant tax on cigarettes will have the same effect.
2. Price of a complement decreases
   For example, there is a decrease in the price of cigars, a complement in the production of cigarettes.
3. The price of a substitute increases
   For example, the price of barley increases relative to tobacco. Farmers decide to reallocate land from tobacco production to barley production.
4. A decrease in the number of producers
   For example, some cigarette producers are so concerned about the cost of government legal action against them that they get out of the business entirely.
5. Future price expectations
   Producers expect prices for their product to be higher next year.
6. There are significant labour problems in the industry
   Cigarette workers are dissatisfied with their wages. Their union disrupts cigarette production for six weeks with an industry-wide strike.

Please note that for the influences listed in Questions #12 & 13, I have relied on Arthur O'Sullivan's Microeconomics: Principles and Tools, Toronto: Pearson Education Canada, 2000, pp. 70-73.