EconPapers    
Economics at your fingertips  
 

SUPPLY RESPONSE UNDER THE 1996 FARM ACT AND IMPLICATIONS FOR THE U.S. FIELD CROPS SECTOR

Daniel De La Torre Ugarte (), Scott Sanford, Robert A. Skinner, Paul Westcott () and William W. Lin

No 33568, Technical Bulletins from United States Department of Agriculture, Economic Research Service

Abstract: The 1996 Farm Act gives farmers almost complete planting flexibility, allowing producers to respond to price changes to a greater extent than they had under previous legislation. This study measures supply responsiveness for major field crops to changes in their own prices and in prices for competing crops and indicates significant increases in responsiveness. Relative to 1986-90, the percentage increases in the responsiveness of U.S. plantings of major field crops to a 1-percent change in their own prices are wheat (1.2 percent), corn (41.6 percent), soybeans (13.5 percent), and cotton (7.9 percent). In percentage terms, the increases in the responsiveness generally become greater with respect to competing crops' price changes. The 1996 legislation has the least effect on U.S. wheat acreage, whereas the law may lead to an average increase of 2 million acres during 1996-2005 in soybean acreage, a decline of 1-2 million acres in corn acreage, and an increase of 0.7 million acres in cotton acreage. Overall, the effect of the farm legislation on regional production patterns of major field crops appears to be modest. Corn acreage expansion in the Central and Northern Plains, a long-term trend in this important wheat production region, will slow under the 1996 legislation, while soybean acreage expansion in this region will accelerate. The authors used the Policy Analysis System-Economic Research Service (POLYSYS-ERS) model that was jointly developed by USDA's Economic Research Service and the University of Tennessee's Agricultural Policy Analysis Center to estimate the effects of the 1996 legislation.

Keywords: Agricultural and Food Policy; Crop Production/Industries (search for similar items in EconPapers)
Pages: 61
Date: 2000
References: Add references at CitEc
Citations: View citations in EconPapers (25) Track citations by RSS feed

Downloads: (external link)
http://ageconsearch.umn.edu/record/33568/files/tb001888.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ags:uerstb:33568

DOI: 10.22004/ag.econ.33568

Access Statistics for this paper

More papers in Technical Bulletins from United States Department of Agriculture, Economic Research Service Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().

 
Page updated 2020-07-07
Handle: RePEc:ags:uerstb:33568