IDEAS home Printed from https://ideas.repec.org/a/oup/ajagec/v91y2009i1p19-41.html
   My bibliography  Save this article

Payment Limitations and Acreage Decisions under Risk Aversion: A Simulation Approach

Author

Listed:
  • Barry K. Goodwin

Abstract

Payment limits have played an important role in U.S. farm policy deliberations for the last thirty years. Current limits are largely nonbinding. Proposals to strengthen and enforce limits are currently in discussion. We evaluate the likely effects of such proposals on acreage for corn, soybeans, wheat, cotton, and rice in several important producing states. Our results generally indicate that payment limits are unlikely to significantly affect acreage in most cases; exceptions occur for cotton and rice, where the probability that limits would be binding is much greater and thus more likely to affect production. Copyright 2009, Oxford University Press.

Suggested Citation

  • Barry K. Goodwin, 2009. "Payment Limitations and Acreage Decisions under Risk Aversion: A Simulation Approach," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 91(1), pages 19-41.
    • Handle: RePEc:oup:ajagec:v:91:y:2009:i:1:p:19-41
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1111/j.1467-8276.2008.01187.x
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. White, T. Kirk & Hoppe, Robert A., 2012. "Changing Farm Structure and the Distribution of Farm Payments and Federal Crop Insurance," Economic Information Bulletin 120309, United States Department of Agriculture, Economic Research Service.
    2. Cary, Michael A. & Frey, Gregory E., 2020. "Alley cropping as an alternative under changing climate and risk scenarios: A Monte-Carlo simulation approach," Agricultural Systems, Elsevier, vol. 185(C).
    3. Cooper, Joseph & Delbecq, Benoît, 2014. "A multi-region approach to assessing fiscal and farm level consequences of government support for farm risk management," Bio-based and Applied Economics Journal, Italian Association of Agricultural and Applied Economics (AIEAA), vol. 3(3), pages 1-23, December.
    4. Finger, Robert, 2012. "Biases in Farm-Level Yield Risk Analysis due to Data Aggregation," Journal of International Agricultural Trade and Development, Journal of International Agricultural Trade and Development, vol. 61(1).
    5. Liu, Y. & Ker, A., 2018. "Is There Too Much History in Historical Yield Data," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 277293, International Association of Agricultural Economists.
    6. Rejesus, Roderick M. & Marra, Michele C. & Roberts, Roland K. & English, Burton C. & Larson, James A. & Paxton, Kenneth W., 2013. "Changes in Producers' Perceptions of Within-Field Yield Variability after Adoption of Cotton Yield Monitors," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 45(2), pages 295-312, May.
    7. Devadoss, Stephen & Luckstead, Jeff, 2018. "Production and Moral Hazard Effects of 2014 Cotton Farm Bill Policies," 2018 Annual Meeting, February 2-6, 2018, Jacksonville, Florida 266763, Southern Agricultural Economics Association.
    8. Cooper, Joseph C. & Langemeier, Michael R. & Schnitkey, Gary D. & Zulauf, Carl R., 2009. "Constructing Farm Level Yield Densities from Aggregated Data: Analysis and Comparison of Approaches," 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin 49216, Agricultural and Applied Economics Association.
    9. Mary, Sebastien & Santini, Fabien & Boulanger, Pierre, 2013. "An Ex-Ante Assessment of CAP Income Stabilisation Payments using a Farm Household Model," 87th Annual Conference, April 8-10, 2013, Warwick University, Coventry, UK 158860, Agricultural Economics Society.
    10. Finger, Robert, 2012. "Biases in Farm-Level Yield Risk Analysis due to Data Aggregation," German Journal of Agricultural Economics, Humboldt-Universitaet zu Berlin, Department for Agricultural Economics, vol. 61(01), pages 1-14, February.
    11. Francisco Rosas & Mariana Sans, 2023. "Quantifying the value to the farmer from adopting climate risk-reducing technologies," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 28(6), pages 1-18, August.
    12. Lee, Sangjun & Zhao, Jinhua & Thornsbury, Suzanne, 2013. "Extreme Events and Land Use Decisions under Climate Change in Tart Cherry Industry in Michigan," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 150568, Agricultural and Applied Economics Association.
    13. Mane, Ranjitsinh & Watkins, Bradley, 2018. "Stochastic Analysis of County and Multi County Yields for Agriculture Risk Coverage (ARC) payments for Arkansas Row Crop Producers," 2018 Annual Meeting, February 2-6, 2018, Jacksonville, Florida 266698, Southern Agricultural Economics Association.
    14. Cooper, Joseph C., 2009. "ACRE: A Revenue-Based Alternative to Price-Based Commodity Payment Programs," 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin 49180, Agricultural and Applied Economics Association.
    15. Liguo Zhang & Xuerong Li, 2016. "The Impact of Traditional Culture on Farmers’ Moral Hazard Behavior in Crop Production: Evidence from China," Sustainability, MDPI, vol. 8(7), pages 1-15, July.
    16. Cooper, Joseph & Hungerford, Ashley & O'Donoghue, Erik, 2015. "Interactions of Shallow Loss Support and Traditional Federal Crop Insurance: Building a Framework for Assessing Commodity Support Issues for the Next Farm Act," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 205310, Agricultural and Applied Economics Association.
    17. Samiul Haque, 2022. "US federal farm payments and farm size: Quantile estimation on panel data," Journal of Agricultural Economics, Wiley Blackwell, vol. 73(1), pages 139-154, February.
    18. Ying-Erh Chen & Barry K Goodwin, 2015. "Policy Design of Multi-Year Crop Insurance Contracts with Partial Payments," PLOS ONE, Public Library of Science, vol. 10(12), pages 1-15, December.
    19. Dörschner, Till & Musshoff, Oliver, 2013. "Does the risk attitude influence the farmers' willingness to participate in agri-environmental measures? – A normative approach to evaluate ecosystem services," 53rd Annual Conference, Berlin, Germany, September 25-27, 2013 156112, German Association of Agricultural Economists (GEWISOLA).
    20. BOULANGER Pierre & PHILIPPIDIS George & URBAN Kirsten, 2017. "Assessing potential coupling factors of European decoupled payments with the Modular Agricultural GeNeral Equilibrium Tool (MAGNET)," JRC Research Reports JRC104276, Joint Research Centre.
    21. Jesse Tack & Keith Coble & Barry Barnett, 2018. "Warming temperatures will likely induce higher premium rates and government outlays for the U.S. crop insurance program," Agricultural Economics, International Association of Agricultural Economists, vol. 49(5), pages 635-647, September.
    22. Zaura Fadhliani & Jeff Luckstead & Eric J. Wailes, 2019. "The impacts of multiperil crop insurance on Indonesian rice farmers and production," Agricultural Economics, International Association of Agricultural Economists, vol. 50(1), pages 15-26, January.
    23. Dörschner, T. & Mußhoff, O., 2014. "Does the Risk Attitude Influence and Farmers’ Willingness to Participate in Agri-Environmental Measures? – A Normative Approach to Evaluate Ecosystem Services," Proceedings “Schriften der Gesellschaft für Wirtschafts- und Sozialwissenschaften des Landbaues e.V.”, German Association of Agricultural Economists (GEWISOLA), vol. 49, March.
    24. Anton, Jesus & Kimura, Shingo, 2009. "Farm Level Analysis of Risk, and Risk Management Strategies and Policies: Evidence from German Crop Farms," 2009 Conference, August 16-22, 2009, Beijing, China 51729, International Association of Agricultural Economists.
    25. Moro, Daniele & Sckokai, Paolo, 2013. "The impact of decoupled payments on farm choices: Conceptual and methodological challenges," Food Policy, Elsevier, vol. 41(C), pages 28-38.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:oup:ajagec:v:91:y:2009:i:1:p:19-41. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Oxford University Press (email available below). General contact details of provider: https://edirc.repec.org/data/aaeaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.