Australian Wheat Policy 1948–79: A Welfare Evaluation

Abstract

AbstractAustralian wheat policy has remained relatively unaltered for thirty‐one years. This paper evaluates its major effects on wheat growers, taxpayers, wheat users, and others. Conventional Marshallian policy analysis was augmented with production and price uncertainty. When policy gains and losses were expressed in net terminal values as of 1979, wheat users gained $‐1,122 million, wheat growers lost $‐995 million, taxpayers contributed $‐1,009 million, and the net social welfare loss was $‐882 million. For growers, the interrelationship between production uncertainty and policy was unfavorable and much larger than the favorable price uncertainty/wheat policy interaction.