U.S. Farm Policy and the Variability of Commodity Prices and Farm Revenues
Historically, the U.S. government has had a substantial involvement in the agricultural sector. Lence and Hayes use a dynamic, three-commodity, rational-expectations storage model to compare the impact of the Federal Agricultural Improvement and Reform (FAIR) Act of 1996 with a free-market policy and with the agricultural policies that preceded the FAIR Act. They show that the transitional payments created to replace the pre-FAIR deficiency payments are much lower than the payments they replaced, which does reduce farm revenues. An important finding of the study is that the main economic impacts of the pre-FAIR scenario, relative to the free-market regime, were to transfer income to farmers and to substitute government storage for private storage in a way that did little to distort prices or to stabilize farm incomes.
|Date of creation:||Mar 2000|
|Contact details of provider:|| Postal: 578 Heady Hall, Ames, IA 50011-1070|
Web page: http://www.fapri.iastate.edu/
More information through EDIRC
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.:
- repec:ias:cpaper:00-fsr1 is not listed on IDEAS
- Babcock, Bruce A. & Beghin, John C. & Mohanty, Samarendu & Fuller, Frank H. & Fabiosa, Jacinto F. & Kaus, Phillip J. & Fang, Cheng & Hart, Chad E. & Kovarik, Karen & Womack, Abner W. & Young, Robert E, 2000. "FAPRI 2000 U.S. Agricultural Outlook," Staff Reports 32054, Food and Agricultural Policy Research Institute (FAPRI).
- Williams,Jeffrey C. & Wright,Brian D., 2005.
"Storage and Commodity Markets,"
Cambridge University Press, number 9780521023399, October.
- Chambers,Robert G., 1988. "Applied Production Analysis," Cambridge Books, Cambridge University Press, number 9780521314275, October.
- Newbery, D M G & Stiglitz, J E, 1979. "The Theory of Commodity Price Stabilisation Rules: Welfare Impacts and Supply Responses," Economic Journal, Royal Economic Society, vol. 89(356), pages 799-817, December.
- Babcock, Bruce A. & Beghin, John C. & Fabiosa, Jacinto F. & de Cara, Stephane & Elobeid, Amani E. & Fang, Cheng & Fuller, Frank H. & Hart, Chad E. & Isik, Murat & Matthey, Holger & Saak, Alexander E. , 2002. "FAPRI 2002 World Agricultural Outlook," Staff Reports 32051, Food and Agricultural Policy Research Institute (FAPRI).
- Lucas, Robert Jr, 1976. "Econometric policy evaluation: A critique," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 1(1), pages 19-46, January.
- Chambers, Marcus J & Bailey, Roy E, 1996.
"A Theory of Commodity Price Fluctuations,"
Journal of Political Economy,
University of Chicago Press, vol. 104(5), pages 924-957, October.
- Deaton, Angus & Laroque, Guy, 1996. "Competitive Storage and Commodity Price Dynamics," Journal of Political Economy, University of Chicago Press, vol. 104(5), pages 896-923, October.
- David R. Lee & Peter G. Helmberger, 1985. "Estimating Supply Response in the Presence of Farm Programs," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 67(2), pages 193-203.
- Wright, Brian D, 1979. "The Effects of Ideal Production Stabilization: A Welfare Analysis Under Rational Behavior," Journal of Political Economy, University of Chicago Press, vol. 87(5), pages 1011-1033, October.
- Gisser, Micha, 1993. "Price Support, Acreage Controls, and Efficient Redistribution," Journal of Political Economy, University of Chicago Press, vol. 101(4), pages 584-611, August.
- Lansford, Vernon & Madison, Daniel & Thompson, Wyatt & Willott, Brian & Adams, Gary M. & Babcock, Bruce A. & Beghin, John C. & Mohanty, Samarendu & Fuller, Frank H. & Chaudhary, Sudhir & Fabiosa, Jaci, 1999. "FAPRI 1999 U.S. Agricultural Outlook," Staff Reports 32049, Food and Agricultural Policy Research Institute (FAPRI).
When requesting a correction, please mention this item's handle: RePEc:ias:fpaper:00-wp239. 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: ()
If references are entirely missing, you can add them using this form.