Agricultural Price Support Policies in Turkey: An Empirical Investigation

Abstract

This chapter examines agricultural support price policies in Turkey and their possible resource allocation effects. It reviews the extent and institutional aspects of support policies and summarizes recent changes in emphasis and direction. As in most developing economies, agriculture plays a crucial role in the economic development of Turkey. The agricultural sector has been subjected to direct and indirect government intervention for a long period of time, starting with wheat in 1932 and followed by other cereals like barley, rye, oats and rice in the 1940’s. While the objective and instrument priorities might have shown slight changes over time, depending on the social, economic and political circumstances facing the policy makers, government intervention in agriculture to date remains one of the major items in the policy makers’ agenda. Agricultural support price policies in Turkey, in addition to their short-run price, output and income effects, probably have resulted in long-run structural changes in the economy via resource allocation effects.