Three excellent papers addressing the future of commodity programs were presented at the SAEA Annual Meeting in February 1980. Each has some very important strengths. “Commodity Policy Issues for the 1980s” by Erickson and Johnson is almost encyclopedic in its coverage, while at the same time being issue-oriented and presenting some very pertinent data. Pasour's “A Critique of Federal Agricultural Programs” is an effective assessment of commodity programs as they existed in the past. Goodwin and his colleagues do yeoman's work in attempting to defend current programs in “The Future of Federal Programs for Southern Commodities.” I assume the contrast between that paper and Pasour's was intentional. Certainly the two of them together help to focus the issues.

The assumption of nonstochastic parameters has long been recognized as restrictive to the solution of many marketing problems and to economic modeling in general. Parameter variation historically has been treated with the use of nonstochastic adjustments through interaction variables and the use of proxy dummy and trend variables. Though these empirical techniques in many cases give reasonable results, they presuppose that the researcher can specify the nature of the parameter change. In fact, it may not be obvious that random parameters are part of the estimation problem. Furthermore, specification of structural shifts in parameters is usually difficult. Comparison of parameter changes through techniques such as grouping of data and using various F-tests is most often dependent on the criteria for grouping (Maddala, p. 390–404). Also, the procedure fails to identify the dynamic path of adjustments that must have occurred when various F-tests indicate that parameters have changed. Other approaches to determining structural shifts in parameters may require elaborate search procedures. To limit the extent to which the search is required, restrictive assumptions about many of the parameters are sometimes made (Simon).

In 1970 a marketing order, made possible by a 1968 state enabling act, was formed for South Carolina fresh market cucumbers. This legislation is similar to current federal legislation, but South Carolina has no federal marketing order for cucumbers. Order provisions that affect price formation are the subject of this article. Price posting and adoption of statewide USDA inspection requirements are the order provisions that yield the largest and most direct price impact (S.C. Cucumber Board.) The apparent goal of these provisions is higher and more stable prices.

The objective of our research is to investigate the success of the South Carolina marketing order in achieving its goal of higher and more stable fresh market cucumber prices.

Industrialization is an integral part of many rural community development programs across the country. Interest in attracting industry is often based on an ex ante assessment by local groups and officials of the positive benefits accruing to the community or area from industrialization. Obvious benefits to a local economy include increased output, income, and employment. Benefits occur in the form of purchases of labor and inputs by industry from endogenous sectors and the resulting local trade. A complete understanding of these benefits by local groups and officials in rural economies is essential for the planning of effective industrial development programs.

Insured farm loans have evolved to be an important component of the federal role in the agricultural credit subsector. Currently, agricultural credit is supplied by three sets of institutions: (1) private firms and individuals, (2) the quasiprivate cooperative Farm Credit System, and (3) the federal public programs of the Farmers Home Administration (FmHA) and Small Business Administration. Statuatory authority currently limits federal programs to a residual role of lending to borrowers who cannot receive credit from the other segments. Though a large component of public programs consists of emergency loans in areas of economic disaster, the FmHA also makes farm operating and real estate loans to farmers who meet the statuatory requirements. The source of funds for some FmHA loans is federal appropriations and money market certificates. However, guaranteed loans have become an important component of FmHA programs. These loans are made in cooperation with other agricultural finance agencies. The public agency insures or guarantees repayment of the loan. The cooperating firm negotiates the loan and provides the funds. Usually the interest payment is below the current market interest rate structure.

Much of the beef produced and sold in the United States before World War II was from grass- or limited grain-fed cattle. However, development of the modern large-scale cattle feeding industry in the 1950s and 1960s greatly increased supplies of grain-fed beef and, by the early 1970s, many American consumers found only USDA Choice beef from heavy, grain-fed cattle in supermarkets. Consumers soon became conditioned to the flavor, juiciness, and tenderness of high quality, well-marbled beef. Proponents of forage or limited grain finishing systems found little support at any marketing level.

Markowitz developed the theoretical background for analysis of investments in reference to the mean and variance of returns of the portfolio of all investments (E-V analysis). Subsequently, Freund adapted the E-V model to farm enterprise decisions, and agricultural economists have applied this model to various agricultural firm problems. The studies of Kliebenstein and Scott, Brink and McCarl, Heifner, Buccola and French, and Raikes, Sieck, and Miller are examples of applications to farm enterprise organization, farm commodity marketing, and procurement of farm commodities by agribusiness firms. These studies are concerned largely with either production or marketing decisions; applications to joint production and marketing decisions are more limited. Exceptions include Whitson, Barry, and Lacewell's study of vertical integration and Barry and Willmann's analysis of forward contracting. In addition, Lütgen and Helmers and Persuad and Mapp recently analyzed a limited number of marketing alternatives in conjunction with different enterprise alternatives.

Responding to the needs of the feeder cattle industry, the USDA (1979) implemented a new feeder cattle grading system which broke from the traditional method of using consistent grade terminology throughout the marketing process. The terms Prime, Choice, Good, etc. were replaced by three frame sizes (large, medium, and small) and three thickness scores (1, 2, and 3). The change from carcass quality terms to production-oriented terminology was deemed necessary because the product characteristics desired by cattle feeders differ from those desired at slaughter by the slaughterer-packer.

In the last decade, vegetarianism has become more prevalent in the United States, although by no means dominant (Adrian and Daniel). Even households which have not become vegetarian have considered decreasing their consumption of meat. This trend has been due to several factors. First, meat is relatively more expensive than other sources of protein. Second, inflation has diminished consumer purchasing power. Third, recent health reports have focused on carcinogenic agents in meat and the dangers of too much cholesterol. Fourth, concern with ecology and world food supplies has increased. Meat is thought to be less efficient in feeding the masses than grains and other nonmeat protein sources.

Sugarcane has been cultivated since at least 8000 B.C. (Barnes, p. 2) and today is grown throughout the world's tropical and subtropical regions. In Florida, sugarcane has been produced commercially since 1920 (Zepp). Before 1960, however, Florida sugar production was not significant; only three mills were in operation. With the ban on importation of Cuban sugar and the lifting of domestic sugarcane acreage restrictions in 1960, the industry grew rapidly.

A linear probability function permits the estimation of the probability of the occurrence or non-occurrence of a discrete event. Nerlove and Press (p. 3–9) outline several statistical problems that arise if such a function is estimated via OLS. In particular, heteroskedasticity inherent in such a regression model leads to inefficient estimates of parameters (Amemiya 1973, Horn and Horn). Moreover, without restrictions on the conventional OLS model, probability estimates lying outside the unit (0–1) interval are possible (Nerlove and Press). Goldberger and Kmenta suggest two approaches for alleviating the heteroskedasticity problems inherent in the OLS regression model. Logit analysis will also alleviate heteroskedasticity problems and ensure that estimated probabilities will lie within the unit interval (Amemiya 1974, Hauck and Donner, Hill and Kau, Horn and Horn, Horn, Horn, and Duncan, Theil 1970).

The U.S. burley tobacco industry faces an important crossroad in this decade. It appears that domestic disappearance of burley tobacco will continue to decrease and U.S. burley tobacco will continue to have stiff competition in foreign markets. The government can influence the U.S. tobacco market in the coming decade through its tobacco program. The alternatives available to government policy makers must be analyzed to help guide policy formulation.

The trend toward larger and fewer farms has alarmed many persons who view the small farm as an integral part of American society. Advocates of the small farm have called for policies to halt the continuing decline in the number of small farms in the United States. In evaluating the merits of potential policies, understanding the composition of small farms in the U.S. is critical.

Appropriate public policy would be very different if small farms were operated solely by households with substantial off-farm income and who need no public assistance, solely by households pursuing an alternative to urban-industrial society's lifestyle and who want no public assistance, or solely by households who are aged and disabled and who want and need public assistance to avoid absolute deprivation.

The Food Stamp Act authorizes the distribution of food coupons (stamps) to households which meet certain income eligibility requirements. This legislation enables low-income households to buy more food of greater variety to improve their diet. In fiscal 1979, the cost of the Food Stamp Program amounted to $6.7 billion and the number of persons participating in the program averaged 18.9 million.

The Food Stamp Act of 1964 (with subsequent amendments) charges the U.S. Department of Agriculture with extending the benefits of the program to all households willing and eligible to participate. This duty was reinforced by a federal court ruling in 1975 (Beckel and MacDonald; Bennett et al. vs. Butz et al.).

Because of the importance of the Food Stamp Program (FSP), numerous studies have been conducted to gauge its intended effectiveness. Areas of study have included nutritional benefits of the program, impact on food expenditures, identification of ways to improve the rate of program participation, and identification of socioeconomic characteristics that may be important indicators of participation or nonparticipation in the program (for example, see Davis and Neenan; Lane; Neenan and Davis 1977, 1978; Salathe; Scearce et al.; Smith and Rowe; West; USDA, 1976, 1978).

Several alternative government programs have been used in the past to achieve policy objectives related to the levels of crop acreage and net farm income. Important questions remain relating to the effectiveness of past programs in achieving selected policy objectives. In particular, what is the relative effectiveness of long-term versus short-term acreage diversion programs? One of the major impacts of government diversion programs is in the allocation of land among competing uses. Several studies (Brandow and Learn; Christensen and Aines; Hathaway) indicate that the use of acreage control on single crops rather than on all crops results in less than proportionate reduction in output from a given reduction in acreage. However, only limited information is available on the interrelationships among major competing uses of crop, pasture, and privately owned forest acreage. Studies of these interrelationships (e.g. Dideriksen et al. and Zeimetz et al.) did not consider the influence of government programs. In particular, how do government programs affect these competing uses?

Tobacco production traditionally has been a highly labor-intensive operation in this country. Although the entire crop is grown on only .3 of 1 percent of the total cropland, tobacco requires more labor than is required for all vegetable crops and about the same amount as needed for cotton and food grains combined (USDA, Agricultural Statistics). However, in recent years a growing trend toward mechanization of harvesting-curing operations has, among other effects, greatly reduced labor usage. During the time period 1949–1976, total man-hours in tobacco production in the United States declined from 747 million to only 275 million—a reduction of more than 63 percent (USDA, Agricultural Statistics). Much of this reduction has been due to the introduction of bulk curing barns and mechanical harvesters (multipass and once-over types), which have replaced tying by hand or machines, conventional barns, and walking or riding primers. Mechanization of tobacco production has been relatively slow because of the special growing, harvesting, and curing requirements. However, the present state of mechanization is not insignificant.

Fertilizer consumption by the U.S. agricultural sector has increased dramatically for several decades. Nitrogen fertilizer use increased 632 percent between 1952 and 1976. Phosphate and potash fertilizer use increased 138 and 229 percent, respectively, in the same period (USDA 1978). However, the upward trend in fertilizer use was temporarily interrupted during the early and mid-1970s as the real fertilizer price began to increase after many years of decline.

Higher levels of aggregate fertilizer consumption over the 1952–1976 period outweighed the decline in the real price of fertilizer as real dollar expenditures for fertilizer continued to rise. Our study includes an attempt to relate fertilizer use for different crops to relevant economic variables.

The view that the navigable waters of the United States should be toll free originated in the colonial period of U.S. history, and became explicitly stated federal policy in the 1884 Rivers and Harbors Act (Ashton et al.). At that time public expenditures for waterway improvements were small and the freight transportation industry was dominated by railroads. Therefore, public policy promoted water transportation as an inexpensive means of encouraging competition for the railroads.

Since the early years of this century public expenditures for improvements of the waterways have risen while water, motor, air, and pipeline transportation have become effective competitors for the railroads. The conditions which justified a toll-free waterway policy changed, but the policy was not altered. Though every president since Franklin Roosevelt has recommended that Congress levy a charge on inland waterway users, legislators have been reluctant to implement such charges.

We find two reasons to develop an improved management information system for local governments. One is the apparent inability of current local government management information systems to warn of imminent financial collapse or to indicate the degree of financial weakness of a local government. Another reason is the need for information that will promote the most efficient use of resources in providing public services.

During the 1970s certain local governments were unable to meet their obligations. Their current obligations exceeded current revenues. The nation was made aware of the crisis when New York City defaulted on some of its loan obligations and sought federal assistance. Other local governments have faced similar crises. Cleveland, Ohio, was in default for a short period during 1978 until it sold some of its assets (urban land and an electric power generating plant) to obtain cash and reduced its programs to reduce current outlays. The crises in those large cities have brought national attention to the financial problems of many local governments—urban and rural, large and small.