In this paper it is argued that liquidity is an important determinate of farm viability. This is particularly so with a rural sector which suffers large variations in income and has a business cycle which typically extends for several years. Present tax arrangements, coupled with a desire by producers to minimise tax, means that surplus cash in high income years is mostly invested in further improvements, developments or capital equipment. An enhanced Income Equalisation Scheme could play a significant role as a risk management tool for producers as well as reducing calls for government assistance during periods of adversity. Suggestions are made for improving the operation and delivery of the scheme including amalgamating Farm Management Bonds and the Income Equalisation Scheme into one scheme operated by financial institutions under an agency agreement.
Download Info
To download:
If you experience problems downloading a file, check if you have the
proper application to
view it first. Information about this may be contained
in the File-Format links below. In case of further problems read
the IDEAS help
page. Note that these files are not on the IDEAS
site. Please be patient as the files may be large.
References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.: