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The Varying Impacts of Agricultural Support Programs on U.S. Farm Household Consumption

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  • James B. Whitaker

Abstract

Farm households are economic agents whose income is derived from farm, off-farm, and government sources. This article uses farm-level data from the Agricultural Resource Management Survey (ARMS) and recent advances in the econometric theory of dynamic pseudo-panels to show that farm households consume various sources of income differently at the margin. Particular attention is given to a specific type of lump-sum government transfer payment intended to be decoupled from (independent of) farm production decisions. The results suggest that relatively decoupled government subsidies have a greater marginal effect on farm household consumption than subsidies that are tied to market conditions. Copyright 2007, Oxford University Press.

Suggested Citation

  • James B. Whitaker, 2007. "The Varying Impacts of Agricultural Support Programs on U.S. Farm Household Consumption," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 91(3), pages 569-580.
    • Handle: RePEc:oup:ajagec:v:91:y:2007:i:3:p:569-580
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    File URL: http://hdl.handle.net/10.1111/j.1467-8276.2009.01257.x
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    Citations

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    Cited by:

    1. Latruffe, Laure & Dupuy, Aurelia & Desjeux, Yann, 2012. "What would farmers’ strategies be in a no-CAP situation? An illustration to France," 86th Annual Conference, April 16-18, 2012, Warwick University, Coventry, UK 134989, Agricultural Economics Society.
    2. Whitaker, James B. & Effland, Anne, 2009. "Income Stabilization Through Government Payments: How is Farm Household Consumption Affected?," Agricultural and Resource Economics Review, Cambridge University Press, vol. 38(1), pages 36-48, April.
    3. Carpentier, Alain & Gohin, Alexandre & Heinzel, Christoph, 2012. "Production Effects of Direct Payments to Active Farmers: a Microeconomic Dynamic and Stochastic Analysis," 123rd Seminar, February 23-24, 2012, Dublin, Ireland 122447, European Association of Agricultural Economists.
    4. Marian Rizov & Jan Pokrivcak & Pavel Ciaian, 2013. "CAP Subsidies and Productivity of the EU Farms," Journal of Agricultural Economics, Wiley Blackwell, vol. 64(3), pages 537-557, September.
    5. repec:fip:fedkrw:rwp2013-07 is not listed on IDEAS
    6. Laure Latruffe & Aurélia Dupuy & Yann Desjeux, 2012. "What would farmers’ strategies be in a no-CAP situation? An illustration from France," Working Papers SMART 12-02, INRAE UMR SMART.
    7. Jason Brown & John Pender & Jeremy G. Weber, 2013. "Rural wealth creation and emerging energy industries: lease and royalty payments to farm households and businesses," Research Working Paper RWP 13-07, Federal Reserve Bank of Kansas City.
    8. Moro, Daniele & Sckokai, Paolo, 2013. "The impact of decoupled payments on farm choices: Conceptual and methodological challenges," Food Policy, Elsevier, vol. 41(C), pages 28-38.

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