EFFECTS OF FEDERAL RISK MANAGEMENT PROGRAMS ON LAND ALLOCATION AND INPUT USE

Sangtaek Seo, Paul Mitchell () and David Leatham ()

No 20160, 2004 Annual meeting, August 1-4, Denver, CO from American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association)

Abstract: We analyze the effects of crop insurance and the Marketing Loan Program on optimal nitrogen use and acreage allocation for a case cotton-sorghum farm in Texas. A mathematical programming model is used to simulate the optimal nitrogen fertilizer rate, crop acreage allocation, coverage level, and price election factor, along with participation in the crop insurance (APH and CRC) and the Marketing Loan Program for both crops. Results show that current insurance programs increase the optimal fertilizer rate 1-3% and increase the optimal cotton acreage 16-129%. The Marketing Loan Program slightly changes optimal fertilizer rates and increases optimal cotton acreage an additional 1-9%.

Keywords: Agricultural and Food Policy; Risk and Uncertainty (search for similar items in EconPapers)
Pages: 26
Date: 2004
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Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea04:20160

DOI: 10.22004/ag.econ.20160

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