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Impacts of Budget Reconciliation on U.S. Crop Producers

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  • Richardson, James W.
  • Outlaw, Joe L.
  • Raulston, J. Marc
  • Knapek, George M.

Abstract

The President has called for a $6.96 billion savings in expenditures to agriculture over a five year period. A budget reconciliation is required to achieve these targeted savings from farm bill authorized expenditures. This study uses optimal control theory and farm level simulation to quantify the impacts on U.S. crop producers of reducing federal spending for agricultural income supports. Results indicate that the least harmful method for the Agricultural Committees to achieve budget savings of $3 billion is to reduce loan rates. At higher levels of net budget savings, some risk adverse decision makers would prefer that the Committees reduce target prices.

Suggested Citation

  • Richardson, James W. & Outlaw, Joe L. & Raulston, J. Marc & Knapek, George M., 2005. "Impacts of Budget Reconciliation on U.S. Crop Producers," 2005 Annual meeting, July 24-27, Providence, RI 19540, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    • Handle: RePEc:ags:aaea05:19540
    DOI: 10.22004/ag.econ.19540
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    References listed on IDEAS

    as
    1. J. Brian Hardaker & James W. Richardson & Gudbrand Lien & Keith D. Schumann, 2004. "Stochastic efficiency analysis with risk aversion bounds: a simplified approach," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 48(2), pages 253-270, June.
    2. repec:ags:joaaec:v:32:y:2000:i:2:p:299-315 is not listed on IDEAS
    3. Richardson, James W. & Klose, Steven L. & Gray, Allan W., 2000. "An Applied Procedure For Estimating And Simulating Multivariate Empirical (Mve) Probability Distributions In Farm-Level Risk Assessment And Policy Analysis," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 32(2), pages 1-17, August.
    4. Richardson, James W. & Outlaw, Joe L. & Anderson, David P. & Sartwelle, James D., III & Feldman, Paul A. & Schumann, Keith D. & Klose, Steven L. & Schwart, Robert B., Jr. & Womack, Abner W., 2001. "Representative Farms Economic Outlook for the December 2003 FAPRI/AFPC Baseline," Working Papers 42720, Texas A&M University, Agricultural and Food Policy Center.
    5. Outlaw, Joe L. & Richardson, James W. & Herbst, Brian K. & Knapek, George M. & Anderson, David P. & Sartwelle, James D., III & Raulston, J. Marc & Feldman, Paul A. & Schumann, Keith D. & Klose, Steven, 2005. "Representative Farms Economic Outlook for the January 2005 FAPRI/AFPC Baseline," Working Papers 42135, Texas A&M University, Agricultural and Food Policy Center.
    6. Richardson, James W. & Outlaw, Joe L., 2004. "Implications of Budget Reconciliation for Commodity Programs," Choices: The Magazine of Food, Farm, and Resource Issues, Agricultural and Applied Economics Association, vol. 19(4), pages 1-3.
    Full references (including those not matched with items on IDEAS)

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