Abstract
The Agricultural Act of 2014 replaced dairy product price supports and countercyclical income support payments with the Margin Protection Program for Dairy Producers. Using farm-level data, producer decisions and aggregate policy costs under a variety of risk environments and policy design alternatives are simulated. Fixed premium rates may result in budget outlays that are substantially higher than for equivalent variable-rate insurance subsidized at levels observed in revenue-based crop insurance policies. Due to the absence of adjusted gross income or production eligibility constraints, a significant portion of benefits may accrue to a small share of large dairy farms.
Original language | English (US) |
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Pages (from-to) | 712-730 |
Number of pages | 19 |
Journal | Applied Economic Perspectives and Policy |
Volume | 38 |
Issue number | 4 |
DOIs | |
State | Published - Dec 2016 |
Bibliographical note
Publisher Copyright:© 2015. Oxford University Agricultural and Applied Economics Association. All rights reserved.
Copyright:
Copyright 2021 Elsevier B.V., All rights reserved.
Keywords
- Agricultural act of 2014
- Dairy
- Farm program decisions
- Margin protection program
- Monte-Carlo simulations