impacts of alternative farm policies on rural communities

Abstract

The purpose of this study was to describe an LP/IO model for evaluating the economic impacts of alternative farm policies on rural communities and demonstrate its capabilities by analyzing the impacts of three farm policies on a rural community in Texas. Results indicate that in the noncrop sector, two groups of industries are most affected by farm policy. The first group relates to production directly (agricultural services, banking and credit, and nondurable manufacturing) and the second group relates to households (retail trade and services). Farm policies which reduce production but increase net returns cause losses for the first group while benefiting the second group. Both groups are made worse off by farm policies which reduce agricultural production and the value of output.

Keywords

farm policy, rural communities, conservation reserve (CRP), mandatory supply controls, 1985 Farm Bill, LP/IO methods

Citation

Bowker, J. Michael; Richardson, James W. 1989. impacts of alternative farm policies on rural communities. Southern Journal of Agricultural Economics: 35-46