Publications

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  • Economics of Water Quality Protection From Nonpoint Sources: Theory and Practice

    AER-782, November 30, 1999

    Water quality is a major environmental issue. Pollution from nonpoint sources is the single largest remaining source of water quality impairments in the United States. Agriculture is a major source of several nonpoint-source pollutants, including nutrients, sediment, pesticides, and salts. Agricultural nonpoint pollution reduction policies can be designed to induce producers to change their production practices in ways that improve the environmental and related economic consequences of production. The information necessary to design economically efficient pollution control policies is almost always lacking. Instead, policies can be designed to achieve specific environmental or other similarly related goals at least cost, given transaction costs and any other political, legal, or informational constraints that may exist. This report outlines the economic characteristics of five instruments that can be used to reduce agricultural nonpoint source pollution (economic incentives, standards, education, liability, and research) and discusses empirical research related to the use of these instruments.

  • USDA Agricultural Baseline Projections to 2007

    WAOB-981, February 02, 1998

    This report provides long-run baseline projections for the agricultural sector through 2007. Projections cover agricultural commodities, agricultural trade, and aggregate indicators of the sector, such as farm income and food prices. The baseline assumes no shocks and is based on specific assumptions regarding macroeconomic conditions, policy, weather, and international developments. The projections assume that current agricultural law of the 1996 Farm Act remains in effect throughout the baseline. Also, the baseline assumes that the Southeast Asian currency devaluations and related economic slowdowns are confined to that region, affecting growth through 2000, with policy reforms and international financial support leading to a recovery of economic growth in subsequent years. Despite the near-term slowdown in Southeast Asian economies, generally favorable global economic growth is projected in the baseline which, combined with liberalized trade associated with both the GATT agreement and unilateral policy reforms, supports strong growth in global trade and U.S. agricultural exports. Greater market orientation in the domestic agricultural sector under the 1996 Farm Act puts U.S. farmers in a favorable position for competing in the global marketplace. A tightening of the balance between productive capacity and projected demands results in rising nominal market prices, increasing farm income, and stability in the financial condition of the agricultural sector. Management of risk will be important for farmers, reflecting the reduced role of the Government in the sector under the 1996 Farm Act. Consumer food prices are projected to continue a long term trend of rising less than the general inflation rate. The baseline projections presented are one representative scenario for the agricultural sector for the next decade. As such, the baseline provides a point of departure for discussion of alternative farm sector outcomes that could result under different assumptions. The projections in this report were prepared in October through December 1997, reflecting a composite of model results and judgmental analysis.

  • Agricultural Baseline Projections to 2005, Reflecting the 1996 Farm Act

    WAOB-971, April 23, 1997

    This report provides long-run baseline projections for the agricultural sector through 2005 that incorporate provisions of the Federal Agriculture Improvement and Reform Act of 1996 (1996 Farm Act). The baseline assumes that the new farm legislation remains in effect through 2005. Projections cover agricultural commodities, agricultural trade, and aggregate indicators of the sector, such as farm income and food prices. Generally favorable global economic growth is projected in the baseline which, combined with liberalized trade associated with both the GATT agreement and unilateral policy reforms, supports strong growth in global trade and U.S. agricultural exports. Greater market orientation in the domestic agricultural sector under the 1996 Farm Act puts U.S. farmers in a favorable position for competing in the global marketplace. A tightening of the balance between productive capacity and demands results in rising nominal market prices, increasing farm income, and stability in the financial condition of the agricultural sector. However, management of risk will be important for farmers. With the reduced role of the Government in the sector under the 1996 Farm Act, farmers in general face greater risk of income volatility due to price variation, reflecting market price variability more directly. Consumer food prices are projected to continue a long term trend of rising less than the general inflation rate. The baseline projections presented are one representative scenario for the agricultural sector through the middle of the next decade, assuming no shocks and based on specific assumptions regarding macroeconomic conditions, policy, weather, and international developments. As such, the baseline provides a point of departure for discussion of alternative farm sector outcomes that could result under different assumptions. The projections in this report were prepared in October through December 1996, reflecting a composite of model results and judgmental analysis.

  • Ethanol and Agriculture: Effect of Increased Production on Crop and Livestock Sectors

    AER-667, May 03, 1993

    Expanded ethanol production could increase U.S. farm income by as much as $1 billion (1.4 percent) by 2000. Because corn is the primary feedstock for ethanol, growers in the Corn Belt would benefit most from improved ethanol technology and heightened demand. Coproducts from the conversion process (corn gluten meal, corn gluten feed, and others) compete with soybean meal, so soybean growers in the South may see revenues decline. The U.S. balance of trade would improve with increased ethanol production as oil import needs decline.

  • Provisions of the Food Security Act of 1985

    AIB-498, April 01, 1986

    The Food Security Act of 1985 (P.L. 99-198) establishes a comprehensive framework within which the Secretary of Agriculture will administer agriculture and food programs from 1986 through 1990. This report describes the Act's provisions for dairy, wool and mohair, wheat, feed grains, cotton, rice, peanuts, soybeans, and sugar (including income and price supports, disaster payments, and acreage reductions); other general commodity provisions; trade; conservation; credit; research, extension, and teaching; food stamps; and marketings. These provisions are compared with earlier legislation.

  • Possible Economic Consequences of Reverting to Permanent Legislation or Eliminating Price and Income Supports

    AER-526, January 01, 1985

    If the agricultural legislation expiring in 1985 is not replaced, farm price and income supports will revert from the programs provided for in the Agriculture and Food Act of 1981 and subsequent legislation to the programs provided for in the permanent support statutes. Reverting to the permanent support programs, dating back in some cases to the 1930s, would raise price and income support levels significantly and greatly reduce the role of market forces in determining farm returns. Conversely, if all price and income supports were eliminated in 1985, Government intervention in the market would end and supply and demand forces would determine farm returns. Adopting either of these two outerbound policy alternatives would have significant and far-reaching impacts on farm operations, the agribusiness sector, the general economy, and ultimately the world market for farm products.