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Southern Farmers' Exposure to Income Risk Under the 1996 Farm Bill

Published online by Cambridge University Press:  28 April 2015

Ronald D. Knutson ,
Edward G. Smith ,
David P. Anderson  and
James W. Richardson
Ronald D. Knutson
Affiliation:
Department of Agricultural Economics, Texas A&M University
Edward G. Smith
Affiliation:
Department of Agricultural Economics, Texas A&M University
David P. Anderson
Affiliation:
Department of Agricultural Economics, Texas A&M University
James W. Richardson
Affiliation:
Department of Agricultural Economics, Texas A&M University
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Abstract

This paper investigates the farm-level impacts of the 1996 farm bill on the South. Focus group perceptions of risk sources, observed acreage changes, and the farm-level impact of increased price risk are evaluated. Focus group respondents ranked price and yield as the two most important sources of risk, and diversification was ranked highly as a risk-management tool. Limited data suggest that acreage shifts among crops are occurring in the South, presumably aided by the 1996 farm bill. Higher probabilities of cash flow deficits are estimated for cotton and rice relative to feedgrain, wheat, and oilseed operations.

Keywords

acreage shiftsincome riskpolicy riskrisk perception
Type
Invited Paper Sessions
Information
Journal of Agricultural and Applied Economics , Volume 30 , Issue 1 , July 1998 , pp. 35 - 46
Copyright
Copyright © Southern Agricultural Economics Association 1998

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