The Benefits of Farm Programs: Incidence, Shifting, and Dissipation

Abstract

T HE proximate beneficiary of most programs is the landowner per se. Farmers who are not landowners, like the migrant harvesters who get down to 25 cents an hour in some places, do not gain, but suffer from lower demand for their services. Landowners who are not farmers, such as the matinee idols, senators, industrial executives and country bankers who sink their spare change in rural real estate, benefit hugely. In the short run, some tenants with long leases, or renewable ones under custombound crop shares, may gain a good deal. But these tenants really have a species of equity in land, and it hardly rises above the dignity of a quibble to cite them to refute what is otherwise too obvious for serious question.' Agricultural economists are becoming increasingly vocal on this subject, which, as farmland values continue to soar in defiance of falling farm income, is increasingly apparent. The work inspired by Walter Chryst is outstanding. His findings really should not surprise us. The surprise is why it took the profession so long to catch up with Ricardo. In analyzing the corn laws -the price supports of his day-he made the same point, and on the side enunciated the law of rent and founded classical economics.