Farm Program Tools: Tradeoffs and Interactions

James Langley, Robert Green, Fred Nelson and Tom Fulton

No 309383, Agricultural Information Bulletins from United States Department of Agriculture, Economic Research Service

Abstract: Farm programs can be used to raise income to program participants, but usually at a cost, depending on the tools used to formulate the programs. The key tools--nonrecourse loans, target prices, acreage reduction, and export subsidies--involve inevitable tradeoffs. By changing one program tool at a time, the tradeoffs between program objectives are more clearly recognized. Target prices transfer tax dollars to producers in the form of deficiency payments. Effective loan rates boost income to program participants and reduce direct Government payments at the expense of lost exports, higher food costs to consumers, and higher stock accumulation. Used alone, acreage reduction programs do not very successfully increase income. Export subsidies have little effect on net income to program participants.

Keywords: Agricultural; and; Food; Policy (search for similar items in EconPapers)
Pages: 8
Date: 1987-07
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Persistent link: https://EconPapers.repec.org/RePEc:ags:uersab:309383

DOI: 10.22004/ag.econ.309383

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