Government Farm Programs Research Articles

Biosolids and conservation tillage for rainfed wheat farming in dry Mediterranean climates

Biosolids are used in dryland wheat (Triticum aestivum L.) production in eastern Washington and other regions of the world as a source of nutrients and to increase soil organic carbon (SOC). Moreover, conservation tillage is promoted to reduce erosion and soil degradation. We explored the impacts of biosolids vs synthetic fertilizer in combination with undercutter (UC) conservation tillage vs tandem disk (TD) traditional tillage in an 8-yr field experiment in drought-prone region near Lind, WA (244 mm avg. annual precipitation). There were two sets of plots to allow for data collection each year in a 2-yr winter wheat (WW)-fallow rotation. Biosolids were applied at 6.5 mt/ha dry weight to meet the nutrient needs of two WW crops. Synthetic fertilizer plots received 56 kg N plus 11 kg S/ha for every wheat crop. Biosolids increased WW grain yield vs synthetic fertilizer by 25% one year but with no differences in other years or the 8-yr avg. Tillage method had no effect on WW grain yield nor grain yield components. Wheat kernel weight was lower and grain protein higher than desirable in biosolids plots, indicating excessive N because the application rate was too high for such a dry environment. Consistent year-long surface residue cover > 30% was achieved with UC tillage for government farm program conservation compliance, but this was not attained with TD tillage. In addition to highly desirable levels of P, biosolids provided significant quantities of the important soil micronutrients Zn, Mn, Cu, Fe. Biosolids application did not increase SOC in the surface 30 cm. This study demonstrated the application of biosolids combined with low-disturbance UC conservation tillage is an agronomically- and environmentally sound practice for dryland wheat production. We believe this is the driest rainfed environment in which biosolids for crop production have yet been evaluated.

Farm Management Practices Used by Wheat Producers in the Western Great Plains: Estimating Their Productivity and Profitability

Changes in government farm programs and the introduction of new technology offer wheat producers in the western Great Plains a variety of management practices to alleviate biotic and agronomic constraints inherent in a wheat monoculture. Producers have adopted alternative tillage systems, crop diversification, and insect-resistant varieties in response to the hot, semiarid growing conditions and increased pest pressure. The objective of this study was to determine if those practices generated positive impacts on wheat yield and corresponding net returns. Panel data collected from a group of 141 producers over a four-year period (N = 564) were analyzed using econometric models. The most significant impacts were from crop diversification, which on average more than doubled returns from $29 to $69 per acre compared to a wheat monoculture. Pest-resistant varieties increased returns by 59%, from $32 to $51 per acre. The use of no-till reduced returns by an average of $13 per acre, but when combined with a modest level of crop diversity, returns approached breakeven. Stakeholders should aspire to increase the profitability of no-till to increase its adoption in this environmentally sensitive region.

FACTORS AFFECTING EFFICIENCY MEASURES OF WESTERN GREAT PLAINS WHEAT DOMINANT FARMS

AbstractThe Great Plains is the most important wheat producing region in the United States. Dwindling returns and changes in government farm programs have reduced wheat acreage, raising concerns over its future viability. Small farms and marginal areas are particularly vulnerable, including the western Great Plains (WGP). To assess the technical and economic viability of wheat farms, the efficiency of 141 wheat farms in the WGP was estimated. Results found substantial inefficiency among all producer types. The largest source of inefficiency was input use among smaller farms. The smaller farms were the most scale efficient, reducing concerns over their future viability.

Planting Cotton in a Crop Residue in a Semiarid Climate: Water Balance and Lint Yield

Cotton (Gossypium hirsutum L.) is planted on more land area than any other crop on the Texas High Plains. Much of this area is considered highly erodible and requires a conservation compliance program to participate in government farm programs. Because this region is semiarid and because irrigation water is increasingly limited, water conservation and efficient use of water are necessary to maximize cotton lint yields. One popular conservation compliance practice used is to plant cotton into a chemically terminated small grain crop, i.e., residue that provides wind protection to the cotton seedlings. Our hypothesis was that in a semiarid region the use of a small grain cover crop under irrigated conditions would use more water than it conserves compared to conventional tilled cotton, thus reducing cotton lint yields. To test the hypothesis separate field studies over two growing seasons and on two soil textures, a loamy fine sand and a clay loam, were conducted. The main treatments were tillage systems (conventional and conservation using terminated wheat residue). The two split plot treatments were water supply based on replacement of calculated grass reference evapotranspiration (ETo). Tillage did not affect the amount of water used by the cotton crop at either location ( 0.05) except for an 80% ETo irrigation treatment at a single location where the bare soil treatment used 10% more water than the residue treatments for both years. The residue treatment decreased (P < 0.05) cotton lint yields at both locations by 12% except for the 50% ETo single irrigation treatment in which the residue treatment yielded 14% more lint than the bare soil treatment. The use of terminated wheat residue had no impact on soil water storage during any part of the year. During a 5-month period associated with wheat growth, the wheat evapotranspiration was 20 to 40 mm more water (P < 0.05) than that lost through soil water evaporation from the conventional treatments. The use of terminated wheat residue did not benefit the water balance of the cotton crop, and was associated with decreased cotton lint yields. The results were consistent with our working hypothesis, and disproved the idea that planting cotton into wheat stubble cover increases water use efficiency.

Agriculture and Trade

Agriculture is an industry which in the absence of government farm programs; the industry comprises many firms selling virtually standardized products. Agriculture is an Industry which can be understood by applying the demand and supply tools of competitive markets. In recent years, agriculture protection and its impact on developing countries have attracted growing attention. The successful integration into the world economy are home to more than 2 billion people has meant that developing countries have increased their share in global trade in Agriculture sector. Most of those gains have come from increased exports of manufactured products. Integration in agriculture is lagging behind. Most industrial and many developing countries still protect agriculture at high levels. Agriculture protection continues to be among the most important issues in global trade negotiations, with high protection in industrial countries being the main cause of the breakdown of the Cancun Ministerial Meetings in 2003. Reshaping the world’s trade system and reducing barriers to trade could accelerate medium term growth and reduce global poverty. For most developing countries, including those are net food importers, agriculture is the key sector for poverty reduction.

Welfare implications of reduced government subsidies to farm families: accounting for fringe benefits

AbstractIn the past three decades, farm families have relied on government payments and off‐farm income to reduce income risk and increase total household income. Studies have shown that, as the income effect dominates, government payments tend to reduce off‐farm labor of farm operators and spouses. But that may not be true if one accounts for fringe benefits associated with off‐farm employment. Additionally, with looming budget deficits and the possibility of a reduction in decoupled government payments, farm families may be facing an altered economic environment. Our study addresses this issue by examining the links between government farm program payments and the ever‐important role of fringe benefits in the off‐farm employment of farm couples. Results from farm‐level data actually show that the marginal effect of government payments on hours worked off‐farm will decrease in magnitude when accounting for fringe benefits, ceteris paribus. These results support the notion that farm households’ welfare loss stemming from reduced decoupled payments may be overstated when models exclude fringe benefits from the estimation of off‐farm labor supply.

Rethinking Government Policies for Growing Farmers

First paragraphs: We can't solve problems by using the same kind of thinking that created them. At no time have these oft-quoted words of Albert Einstein been more appropriate than in addressing the problems of today's farmers. Between 1940 and 1990, with the industrialization of agriculture, the number of farms in the U.S. dropped from more than six million to just over two million. This drop in the number of farms has since leveled off, but the ability of farms to support farm families has continued to decline. Over the past couple of decades, around 90 percent of farm family income has come from nonfarm sources. In spite of all of the political rhetoric about supporting family farms, government farm programs have consistently subsidized the industrialization of agriculture. As a consequence, farm programs have contributed both directly and indirectly to the demise of family farms. Subsidized, standardized, routinized, and simplified farm management has effectively coerced or forced fewer farmers on larger farms to produce more food at ever lower economic costs. However, these same strategies are directly responsible for the lack of agricultural sustainability. We can’t solve the ecological, social, or economic problems of agriculture today with the same kind of thinking that created them....

Agricultural Policy Reform and Its Impact on Farm Households Income Inequality

In the United States the 1996 agricultural policy reform ushered in market-oriented farm policies and also gave farmers a seven-year lump-sum payment that was not tied to production. Some scholars argue that farm program payments have changed the distribution of income among farm households. Our study uses a national farmlevel survey for 1996-2001 to investigate a) the distribution of income among farm households, b) the sources that contribute to income inequality, and c) the role of farm program payments in equalizing income. Results show a high but declining income inequality between 1996 and 2001. Among the income components that contributed the most to income inequality was an income component labeled Income from farming and all other sources. Findings further show that marginal increases in both off-farm labor income and farm program payments reduce income inequality. The impact of various income components on overall reduction in income inequality therefore depends on a household’s participation in off-farm work and government farm programs.

Effect of agricultural policy on regional income inequality among farm households

Policymakers are under constant pressure to alleviate financial stress, mainly associated with farm business income, on farm households through government farm program payments. The 1996 FAIR Act signaled the end of these payments and Congress decided that agricultural policy should be more market oriented. Using the Gini coefficient concept and a large farm-level dataset, this study investigates the impact of government payments on income inequality among farm households in nine farming resource regions of the U.S. Results indicate that distribution of income among farm households in the Fruitful Rim region was above the level of dispersion for all U.S. farm households; however, income inequality in the Heartland region was below the level of dispersion for all U.S. farm households. Finally, income from government farm programs helped reduce total income inequality in the Heartland and Northern Great Plains regions, while income from off-farm wages and/or salaries played an important role in reducing total income inequality in Basin and Range and Fruitful Rim regions of the U.S. farm sector.

Then and Now: 125 Years of Dryland Wheat Farming in the Inland Pacific Northwest

This article is a history of dryland wheat (Triticum aestivum L.) farming in the low‐precipitation (&lt;300 mm annual) region on the Columbia Plateau of the Inland Pacific Northwest (PNW) of the United States. Numerous technological advances, environmental problems, and sociological factors influenced wheat farming since its inception in 1880. The wheat‐based economy traces back to the pioneers who faced many challenges that included scarcity of water and wood, unprecedented wind erosion, drought, and minimal equipment. Throughout the years, major technological breakthroughs include: (i) horse (Equus caballus) farming to crude crawler tractors to the 350+ horse power tractors of today, (ii) transition from sacked grain to bulk grain handling, (iii) nitrogen fertilizer and herbicides, (iv) the rotary rodweeder, and (v) the deep furrow split‐packer drill to allow early planting of winter wheat into stored soil water. Cultural practices have evolved from repeated passes with high‐soil‐disturbance tillage implements to today's conservation tillage management. The 2‐yr winter wheat–summer fallow rotation continues as the dominant cropping system as it is less risky and more profitable than alternative systems tested so far. Improved wheat cultivars for deep furrow planting continue to be developed with good emergence, disease resistance, winter hardiness, grain quality, and other values. In the past 125 yr, average farm size has grown from 65 to 1400 ha and wheat grain yield increased from &lt;1.0 to 3.4 Mg ha−1. Since the 1930s, government farm programs have provided unwavering support that, in the last several decades, accounts for about 40% of gross farm income.

How U.S. Farm Programs and Crop Revenue Insurance Affect Returns to Farm Land

A simulation model incorporating price and yield variability is used to examine the impact of government farm program and crop revenue coverage (CRC) insurance payments on the probability distribution of returns to land. Results indicate that Marketing Loan Program payments have the greatest impact on both the mean and standard deviation of returns. Agricultural Market Transition Act payments shift the distribution of returns without changing the variability, creating a reduction in relative risk. Market loss assistance payments increase the mean, reduce variability, and increase skewness. When combined, farm programs substantially increase the value that risk-averse producers place on the residual returns to land and substantially reduce the certainty equivalent value of CRC.

Better Opportunities or Worse? The Demise of Cotton Harvest Labor, 1949–1964

Following World War II millions of cotton workers, especially African-Americans, left the fields forever, and farmers mechanized the cotton harvest. Prevailing empirical studies argue that high factory wages lured farmhands away. Based on newly reconstructed data, we estimate the causes of the demise of harvest employment in 12 major cotton-producing states from 1949–1964 and find important roles for mechanization, government farm programs, higher nonagricultural wages, and falling cotton prices. On net, our estimates indicate that factors affecting farm labor demand, not labor-supply influences, caused the disappearance of hand-picked cotton—results that reverse the best econometric work to date.For helpful comments, we thank Lee Alston, Larry Neal, Werner Baer, Bill Collins, Lee Craig, Carl Moody, Beverley Peart, Eric Hilt, Michele Knapp, the participants of the workshops at Syracuse University, Northwestern University, the University of Illinois, Colby College, Harvard University, the All-Ohio Economic History Seminar (Ohio State University Economics Department), the Social Science History Association Meeting (2001), and the Allied Social Science Meeting (2002), anonymous referees and the editor, Gavin Wright. The authors assume full responsibility for errors and omissions.

Half a Century of Cropland Change

You and I both know that suburban development is encroaching on productive agricultural land in the United States, because we have the evidence of very own eyes. Each of us can think of former fields that have been converted to nonagricultural use. But how representative are observations? Advocates of growth control argue that this country is losing at an alarming and unacceptable rate (AFT 1997; Sorensen, Greene, and Russ 1997; Sierra Club 1998, 1999, 2000). Should we share their concern? We know that the use of cropland changes from year to year and that in any given year a significant fraction of cropland, perhaps one-fifth to one-third, does not actually produce any crops at all. Drought, flood, storm, diseases, insects, and other destructive forces of nature can nullify the best-laid plans of farmers, but complete crop failure is only part, and usually quite a small part, of the explanation. Good farmers rotate their crops, and many rotations require that in some year of the rotation each piece of ground lie fallow, or be used only for pasture, or grow only cover crops that are not harvested. The inherent capability of soil and climate to produce crops is only one of many factors that influence the way farmers use cropland. Land may also lie uncultivated temporarily for idiosyncratic, nonagronomic reasons: family squabbles over inheritance or divorce, compliance with or circumvention of government farm programs, quirks of wealthy landowners who do not have to extract income from every acre they possess. The use of cropland is constantly changing, and changes from year to year or from census to census may be only short-term fluctuations that are little more than statistical noise. A clear picture of cropland change in the United States requires an analysis of long-term trends that places the distractions of short-term noise in proper perspective. The dawn of a new century seems an appropriate time for a close examination of the geography of cropland change in the preceding half-century. Fifty years is time enough to provide a balanced view of long-term trends and patterns and a more robust and defensible for judging whether suburban encroachment and development threaten the future of agricultural land base (AFT 1997, xi). THE NATIONAL AGRICULTURAL LANDS STUDY The first major false alarm about our vanishing farmland was sounded in 1979, when the National Agricultural Lands Study (NALs) made scare headlines by asking, Will there be Florida oranges, fresh milk from St. Johnsbury--and Michigan tart cherries? Florida--producer of more than half of the world's grapefruit and one-fourth of its oranges--will lose virtually all of its unique and prime farm land by the turn of the century if present land loss trends continue (Fields 1979, 14). Serious students of land use immediately recognized that the NALS estimates were grossly exaggerated (Fischel 1982; Raup 1982). The NALS had derived these estimates from a comparison of two sample surveys made by the U.S. Soil Conservation Service (scs) in 1967 and in 1975. The comparison was made even though the 1975 survey was conducted in great haste, had different objectives, used different procedures and a far skimpier sample, and was never intended to be comparable with the 1967 survey. In 1984 the U.S. Department of Agriculture essentially disavowed the NALS estimates (Gustafson and Bills 1984), but these inflated estimates still circulate, and some people persist in citing them (AFT 1997, xi). Florida illustrates the errors that an undersized sample can produce. James R. Anderson, head of the Office of Geographic Research at the U.S. Geological Survey, ever the cautious bureaucrat, was so concerned about the errors in the NALS data that he dispatched Richard Kleckner to the scs office at the Iowa State University Statistics Laboratory to compare the NALS estimates with other data on a county-by-county basis in an attempt to find the source of error. …

Structural and productivity change in US agriculture, 1950–1982

AbstractThis paper tests whether structural change in US agriculture is an important channel to TFP growth and evaluates the relative impact of (i) public research and education policies, (ii) private R&amp;D and market forces, and (iii) government farm programs on structural change. We specify a structural econometric model, fit it to US state aggregate data, 1953–1982, and use the associated reduced‐form model to perform counter‐factual policy simulations. The findings include: structural change is a channel to TFP growth in both crop and livestock subsector, i.e. specialization, size, and part‐time farming do impact TFP, holding other variables constant. Public R&amp;D and education have been at least as important as private R&amp;D and market forces for changing livestock specialization, farm size, and farmers’ off‐farm work participation over the study period, but private R&amp;D and market forces have been relatively more important for crop specialization. Changes in farm commodity programs had little impact on farm structure over these study period. Overall, we conclude that if public R&amp;D and education policies had been unchanged at their 1950 values over 1950–1982, major structural changes in US agriculture would have occurred anyway. The forces of private R&amp;D and market forces were at work, including a decline in the price of machinery services and agricultural chemicals, relative to the farm wage.

Institutions and Interest Group Power: Agricultural Policy in the United States, France, and Japan

In 1933, the U.S. Congress passed the Agricultural Adjustment Act (AAA). A cornerstone of the New Deal, the AAA offered government payment to farmers who cut production of basic crops such as wheat, cotton, and corn. Originally designed to lift agriculture out of the depths of the Great Depression, government farm programs evolved over the next several decades into a complex policy regime of price supports, acreage controls, and government loans.

Structural and productivity change in US agriculture, 1950–1982

This paper tests whether structural change in US agriculture is an important channel to TFP growth and evaluates the relative impact of (i) public research and education policies, (ii) private R&D and market forces, and (iii) government farm programs on structural change. We specify a structural econometric model, fit it to US state aggregate data, 1953–1982, and use the associated reduced-form model to perform counter-factual policy simulations. The findings include: structural change is a channel to TFP growth in both crop and livestock subsector, i.e. specialization, size, and part-time farming do impact TFP, holding other variables constant. Public R&D and education have been at least as important as private R&D and market forces for changing livestock specialization, farm size, and farmers’ off-farm work participation over the study period, but private R&D and market forces have been relatively more important for crop specialization. Changes in farm commodity programs had little impact on farm structure over these study period. Overall, we conclude that if public R&D and education policies had been unchanged at their 1950 values over 1950–1982, major structural changes in US agriculture would have occurred anyway. The forces of private R&D and market forces were at work, including a decline in the price of machinery services and agricultural chemicals, relative to the farm wage.

Commodity futures markets: a survey

This review article describes the main contributions in the literature on commodity futures markets. It is argued that modern studies have focused primarily on technical questions, with insufficient economic content. More research needs to be directed towards understanding fundamental economic issues such as why so few farmers hedge, the impacts of government farm programs on commodity futures, and the market impacts of commodity pools. The literature has failed to explain the prevalence of inverted markets in grains and oilseeds, and there is unexplainable price volatility in markets such as hogs and orange juice.

Farm Income Variability and the Supply of Off‐Farm Labor

AbstractIf farmers are risk averse, greater farm income variability should increase off‐farm labor supply. This effect is confirmed for a sample of Kansas farmers. Off‐farm employment of farmers and their spouses is also found to be significantly influenced by farm experience, off‐farm work experience, farm size, leverage, efficiency, and farm‐specific education. In addition, farm operators and spouses who receive significant income support through government farm programs are less likely to work off the farm. This may suggest that policy changes reducing farm income support payments may increase off‐farm employment of farmers and their spouses.

Gains from Trade, Inefficiency of Government Programs, and the Net Economic Effects of Trading

A great deal has been written on the inefficiencies of government farm programs and associated welfare effects (e.g., Just, Hueth, and Schmitz 1982; Gardner 1983, 1987; Schmitz, Sigurdson, and Doering 1986; Schmitz 1988). However, common measures of inefficiency and distributional impact have not addressed the following question: How are gains from trade and the inefficiencies of government programs related? From a policy perspective, knowing the trade impacts of government programs is at least as important as knowing the inefficiency effects. For example, is it possible for gains from trade to outweigh farm program inefficiencies? Alternatively, could it be that negative trade impacts combined with farm program inefficiencies create situations in which no trade would be preferred to trade under existing government policy distortions? In this paper we establish the link between classic ‘‘gains from trade’’ and the inefficiency of distortionary government programs. Using this framework, we show both theoretically and empirically that the net economic effects of trading can be negative (i.e., no trade would be preferred to trade under distortions). We show that

The use of United States' farm commodity programs in sustainable cash grain production systems: An economic case study

Data from a long‐term farming systems trial of sustainable and conventional cash grain rotations are used to show the relative merits of participating in the government farm programs. These rotations were studied through use of 20‐year simulations of the 1990 Farm Program, the 1990 Farm Program with expanded flex provisions, and three proposals for the 1996 Farm Program, including one that closely resembles the Federal Agriculture Improvement and Reform Act of 1996. These different commodity programs provide a beneficial income safety net for farmers who have made the decisions to practice sustainable crop rotations. The benefits, however, are less than those for conventional farmers. Compared with conventional farmers, sustainable program participants face (1) restrictions in practicing their rotations, (2) reduced land values because of loss of base acreage, and (3) smaller income streams from reduced deficiency payments. Program alternatives that offer 100% flexibility allow sustainable farmers largely to avoid the first two problems; the 1996 act can provide a financial safety net for conventional farmers interested in converting to a more sustainable crop rotation.