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Predatory versus Productive Government: The Case of U.S. Agricultural Policies

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  • Gordon C. Rausser

Abstract

This essay will argue that agricultural policy in the United States has led to both the enhancement of efficiency through "productive policies" and the transfer of wealth and income to special interests through redistributive or "predatory policies." These two activities can be labeled as PESTs and PERTs. PEST policies, or political-economic-seeking transfers, are meant to redistribute wealth from one social group to another and are not explicitly concerned with efficiency. In contrast, PERTs, or political-economic resource transactions, are intended to correct market failures or to provide public goods; these policies have neutral distributional effects, at least in design. A review of the history of public policy in agriculture reveals not only tension between the PERT and PEST roles of the public sector, but also some coordination between these two types of activities. As different interest groups pressure the political process, the government trades off PESTs and PERTs in its attempts to acquire, balance, and secure political power. At times this has led to combinations of programs that appear incoherent. In such a world, the challenge for economists is to design and advocate policies that are both economically productive and politically sustainable.

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  • Gordon C. Rausser, 1992. "Predatory versus Productive Government: The Case of U.S. Agricultural Policies," Journal of Economic Perspectives, American Economic Association, vol. 6(3), pages 133-157, Summer.
  • Handle: RePEc:aea:jecper:v:6:y:1992:i:3:p:133-57
    Note: DOI: 10.1257/jep.6.3.133
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    1. Gordon C. Rausser & William E. Foster, 1990. "Political Preference Functions and Public Policy Reform," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 72(3), pages 641-652.
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    12. Bhagwati, Jagdish N, 1982. "Directly Unproductive, Profit-seeking (DUP) Activities," Journal of Political Economy, University of Chicago Press, vol. 90(5), pages 988-1002, October.
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    15. Rausser, Gordon C, 1974. "Technological Change, Production, and Investment in Natural Resource Industries," American Economic Review, American Economic Association, vol. 64(6), pages 1049-1059, December.
    16. Gordon C. Rausser & James A. Chalfant & H. Alan Love & Kostas G. Stamoulis, 1986. "Macroeconomic Linkages, Taxes, and Subsidies in the U.S. Agricultural Sector," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 68(2), pages 399-412.
    17. Holmes, Beatrice Hort, 1979. "History of Federal Water Resources Programs and Policies, 1961-1970," Miscellaneous Publications 312477, United States Department of Agriculture, Economic Research Service.
    18. Gordon C. Rausser & James A. Chalfant & H. Alan Love & Kostas G. Stamoulis, 1986. "Macroeconomic Linkages, Taxes, and Subsidies in the U.S. Agricultural Sector," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 68(2), pages 399-412.
    19. Rausser, Gordon C. & Lapan, Harvey E., 1979. "Natural resources, goods, bads and alternative institutional frameworks," Resources and Energy, Elsevier, vol. 2(4), pages 293-324, December.
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    21. Bruce Gardner, 1983. "Efficient Redistribution through Commodity Markets," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 65(2), pages 225-234.
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    23. Gordon C. Rausser, 1982. "Political Economic Markets: PERTs and PESTs in Food and Agriculture," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 64(5), pages 821-833.
    24. Gordon C. Rausser, 1982. "Political Economic Markets: PERTs and PESTs in Food and Agriculture," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 64(5), pages 821-833.
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    More about this item

    JEL classification:

    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior

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