IDEAS home Printed from https://ideas.repec.org/a/ags/iaaeaj/172992.html
   My bibliography  Save this article

A critical assessment of the political preference function approach in agricultural economics

Author

Listed:
  • Cramon-Taubadel, Stephan von

Abstract

The policy preference function (PPF) approach has become popular with economists seeking to explain the origin of government policies. In this paper, a distinction between positive and normative work with the PPF concept is made. Positive work is shown to suffer from a variety of shortcomings including the misspecification of traditional PPFS and the failure to consider the importance of institutions, constraints and the interaction between different commodity policies. These weaknesses are reflected in the counter-intuitive results of a simple PPF model designed to reflect the interaction between the EC's wheat and barley policies. Furthermore, it is demonstrated that PPF weights change as a result of both political preferences and market parameters. Hence, changes in PPF weights cannot be attributed to changes in preferences alone. Tests of the axioms of revealed preference theory are used to demonstrate that even though PPF weights derived for the EC's wheat and barley markets have fluctuated considerably since the early 1970s, we are not able to conclude that there has been a shift in political preferences. The paper concludes with some comments about the use of PPFS in a normative framework. The underlying assumption that policy-makers optimise seems, not surprisingly, often to lead practitioners to the conclusion that observed policies are not so bad after all. Economists should also beware of the tendency to overlook possible differences between the PPF and the social welfare function.

Suggested Citation

  • Cramon-Taubadel, Stephan von, 1992. "A critical assessment of the political preference function approach in agricultural economics," Agricultural Economics of Agricultural Economists, International Association of Agricultural Economists, vol. 7(3-4), October.
  • Handle: RePEc:ags:iaaeaj:172992
    as

    Download full text from publisher

    File URL: http://purl.umn.edu/172992
    Download Restriction: no

    References listed on IDEAS

    as
    1. D. MacLaren, 1991. "Agricultural Trade Policy Analysis And International Trade Theory: A Review Of Recent Developments," Journal of Agricultural Economics, Wiley Blackwell, vol. 42(3), pages 250-297.
    2. Varian, Hal R, 1982. "The Nonparametric Approach to Demand Analysis," Econometrica, Econometric Society, vol. 50(4), pages 945-973, July.
    3. Bruce L. Gardner, 1989. "Economic Theory and Farm Politics," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, pages 1165-1171.
    4. Rodrik, Dani, 1986. "Tariffs, subsidies, and welfare with endogenous policy," Journal of International Economics, Elsevier, vol. 21(3-4), pages 285-299, November.
    5. Munk, K J, 1989. "Price Support to the EC Agricultural Sector: An Optimal Policy?," Oxford Review of Economic Policy, Oxford University Press, vol. 5(2), pages 76-89, Summer.
    6. Frey, Bruno S, 1986. "Economists Favour the Price System--Who Else Does?," Kyklos, Wiley Blackwell, vol. 39(4), pages 537-563.
    7. Mayer, Wolfgang & Riezman, Raymond G., 1987. "Endogenous choice of trade policy instruments," Journal of International Economics, Elsevier, vol. 23(3-4), pages 377-381, November.
    8. Rausser, Gordon C & Freebairn, John W, 1974. "Estimation of Policy Preference Functions: An Application to U.S. Beef Import Quotas," The Review of Economics and Statistics, MIT Press, vol. 56(4), pages 437-449, November.
    9. David Vanzetti & John Kennedy, 1988. "Endogenous Price Policies and International Wheat Prices: Comment," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 70(3), pages 743-746.
    10. Riethmuller, Paul & Roe, Terry, 1986. "Government intervention in commodity markets: The case of Japanese rice and wheat policy," Journal of Policy Modeling, Elsevier, vol. 8(3), pages 327-349.
    11. Rausser, Gordon C & de Gorter, Harry, 1991. "The Political Economy of Commodity and Public Good Policies in European Agriculture: Implications for Policy Reform," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 18(3-4), pages 485-504.
    12. Nelson, Robert H, 1987. "The Economics Profession and the Making of Public Policy," Journal of Economic Literature, American Economic Association, vol. 25(1), pages 49-91, March.
    13. 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.
    14. 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.
    15. M. P. Burton & T. Young, 1991. "Non-Parametric Tests For Changes In Consumer Preferences For Meat In Great Britain," Journal of Agricultural Economics, Wiley Blackwell, vol. 42(2), pages 138-145.
    16. Gardner, Bruce L, 1987. "Causes of U.S. Farm Commodity Programs," Journal of Political Economy, University of Chicago Press, vol. 95(2), pages 290-310, April.
    17. Rabinowicz, Ewa, 1991. "New Strategies in Agricultural and Rural Policies: Some Comments," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 18(3-4), pages 505-510.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Salhofer, K., 1996. "Efficient income redistribution for a small country using optimal combined instruments," Agricultural Economics, Blackwell, pages 191-199.
    2. Aparajita Goyal & John Nash, 2017. "Reaping Richer Returns," World Bank Publications, The World Bank, number 25996.
    3. Atici, Cemal & Kennedy, P. Lynn, 2000. "A Game Theoretic Analysis of Turkey's Integration into the European Union," 2000 Conference, August 13-18, 2000, Berlin, Germany 197225, International Association of Agricultural Economists.
    4. Fertő, Imre, 1998. "Az agrárpolitika politikai gazdaságtana I. A kormányzati politikák modellezése a mezőgazdaságban
      [The political economy of agrarian politics. Part I. Modeling of governmental policies in agricultur
      ," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(3), pages 223-246.
    5. Jesús Antón López, 1996. "Explaining stocks and export subsidies in agriculture: the case of wheat," Documentos de trabajo de la Facultad de Ciencias Económicas y Empresariales 96-28, Universidad Complutense de Madrid, Facultad de Ciencias Económicas y Empresariales.

    More about this item

    Keywords

    Political Economy; Production Economics;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:iaaeaj:172992. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search). General contact details of provider: http://edirc.repec.org/data/iaaeeea.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.