How does government policies affect agriculture


How do agricultural policies affect land-use decisions?

 · Government and Agriculture. The consensus on the appropriate role of government in the agricultural economy has shifted over time toward less direct management of economic activities and fewer controls on prices and quantities of factors and outputs. Although the concept of ‘market failure’ in the private sector has long been recognized in economics, the …

What is the role of government in the agricultural economy?

 · Policies Have Environmental Consequences. Agricultural and conservation policies may affect farmers’ land-use decisions directly or indirectly. These decisions will likely be associated with less economically productive land, and these lands are also likely to be more environmentally sensitive along several dimensions than average cropland.

How do agricultural programs affect the environment?

Federal policies and programs that influence the supply and prices ofagricultural products indirect- ly affectfood choices and nutrient consumption. Some programs retire farmland, restricting com- modity production and raising prices. Others en- courage placecommodity production with guaranteed prices. Still other programs affect supplies

How does agribusiness policy affect the environment?

 · GOVERNMENT POLICIES AFFECT WHAT CROPS ARE GROWN ON AMERICAN FARMLAND. Fruits and vegetables are good for us. They lower the incidence and mortality of the most common chronic diseases in America. 8 Yet less than 4% of total US cropland in 2004 was planted with fruits and vegetables. 9 What is happening on the rest of our farmland? These …


How does the government influence agriculture?

Land prices – the value of farm land is influenced directly and indirectly by federal fiscal policy, federal and state tax policy, conservation policy, and economic decisions made by government. Is it possible that an overheated market for farmland could hurt farm interests?

How do government policies affect food production?

U.S. food policy may impact foreign farmers negatively in four principal ways: restricting imports in which developing countries have a comparative advantage; stimulating an overproduction of commodities in the U.S., that when the U.S. exports lowers the international price of goods from which low-income country …

What government policies exist related to agriculture?

The most recent of these Farm Bills, the Agricultural Improvement Act of 2018 (2018 Farm Bill), authorizes policies in the areas of commodity programs and crop insurance, conservation on agricultural lands, agricultural trade (including foreign food assistance), nutrition (primarily domestic food assistance), farm …

What are examples of agricultural policies?

These policies include loans, disaster assistance, price and revenue guarantees, supply restrictions, import barriers, payments to idle land, marketing orders (which are effectively government-sanctioned cartels), and subsidized crop insurance.

Why is agricultural policy important?

The Law states that the agricultural policies are aiming at improving welfare level in the agricultural sector by ensuring agricultural development, increasing productivity, strengthening food safety and security, protecting and improving natural and biological resources, developing producer organizations, …

What is agricultural policy?

Agricultural policy is a statement of action and a fundamental tool employed in achieving agricultural development. A programme, on the other hand is a comprehensive plan that includes objectives to be attained, specifications of resources required and stages of work to be performed.

What is agricultural policy and policy making?

Agricultural policy is concerned with the relations between agriculture, economics, and society. Land ownership and the structure of farm enterprises were traditionally regarded as primarily social problems.

What has government done to improve agriculture?

The Government of India has structured Pradhan Mantri Krishi Sinchayee Yojana (PMKSY) with the vision to extend the coverage of irrigation and improving water use efficiency in a focused manner. PMKSY focuses end to end solution on source creation, distribution, management, field application and extension activities.

What are the major goals of agriculture policy?

Achieving national self sufficiency in food production 3. Raising the living standard of the farm families 4. The conservation of Agricultural Resources 5. To reduce the pressure of population in the agricultural sector.

What are the 5 agricultural policy?

In details, the policies cover 16 areas, including basic rural management system, agricultural subsidy policy, agricultural technology policy, and resources and environment protection policy, etc. These policies have played an important role in the development of the agricultural and rural economics.

What policy changes are needed to achieve higher growth in agriculture?

This needs to be done through tax rationalizations, duty exemptions, increases in public spending, priority sector lending and FDI. It is steps such as these that will boost private sector investment in supply chain infrastructure and services, leading to a reduction in waste and more added value.

What government policy impacts farmers the most?

What Government Policy Impacts Farms the Most? – North Carolina Soybeans. Farmers are extremely attentive to governmental policy, especially the regulations generated by the Environmental Protection Agency, but also tax policy, trade policy, and conservation policy. Immigration policy has recently moved to the forefront …

What is the purpose of the Farm Policy?

Its genuine purpose is to provide some clarity and predictability to the farm-scale business cycle. Critics inside and outside of government question the proper role of government in supporting the farm economy, resulting in a farm policy increasingly shaped by political pressures. This is not unique.

What is the role of the Federal Reserve in the world economy?

U.S. fiscal and monetary policy – The Federal Reserve sets interest rates while the Treasury Department monitors exchange rates with particular attention to “managed exchange rates” utilized by some other nations in the world economy. A weak U.S. dollar is generally seen as being to the advantage of agricultural exporters. The Federal Research has maintained interest rates at low levels to stimulate the economy, although this could change if inflationary pressure were to build. The U.S. soybean industry has become particularly sensitive to international demand now that every other row of soybeans is exported. A weak dollar serves to augment the flow of beans to offshore markets as well as the flow of U.S. pork, chicken and beef, which are fed on soybeans and consumed abroad. Nations that manage exchange rates are effectively raising the price of soybeans in their domestic markets. The role of federal policy in both these situations is crucial to the trade in grains and meat.

How is the value of farm land influenced by the government?

Land prices – the value of farm land is influenced directly and indirectly by federal fiscal policy, federal and state tax policy, conservation policy, and economic decisions made by government. Is it possible that an overheated market for farmland could hurt farm interests? That tax policy could be an impediment to transitioning farms to new generations of farmers? That government policy could inflate land rents? At a minimum, a good understanding of cause and effect should be established with regard to policy and farm land values.

What is the farm safety net?

The Farm Safety Net – the safety net refers to the farm policies in the federal Farm Bill plus crop insurance provisions handled through other legislation. The Farm Bill is designed to take the volatility out of annual farm revenues plus it aims to achieve additional benefits like conserving natural resources and encouraging innovation in production. The commodity title of the Farm Bill is the core component aimed at farm incomes. Its genuine purpose is to provide some clarity and predictability to the farm-scale business cycle. Critics inside and outside of government question the proper role of government in supporting the farm economy, resulting in a farm policy increasingly shaped by political pressures. This is not unique. All developed and developing nations tend to adopt policies to protect their farmers from economic forces beyond their control. Why would we want to move in a policy direction that puts U.S. farmers at a disadvantage to competitors around the world? Why would the U.S. farm industry want to be the lone man out?

How has globalization affected agriculture?

the 3 billion bananas consumed in Canada every year [ 1 ]). These forces have stimulated the rise in export-oriented crop production in countries around the world. The result has been a concomitant dependence on agriculture-directed foreign investment in exporting countries, and food supply in importing countries. Although theories of comparative advantage point to the benefits of this international supply chain, there are numerous associated problems. These include but are not limited to the negative impact of monocropping [ 2 ], including a rise in fertilizer and pesticide use in foreign investment dependant countries [ 3 ], dependence on health and environmentally harmful crops such as tobacco [ 4 ] , enhanced vulnerability to environmental and economic shocks [ 5 ], the environmental consequences of extensive refrigeration and transportation emissions across large distances [ 6 ], and the pressures on agricultural producing governments to avoid enforcing strong labour and environmental controls for fear of losing revenue from foreign trade and investment (although there is a body of literature suggesting that these standards are actually strengthened through international trade regimes) [ 7, 8 ]. These challenges at the intersection of globalization and agricultural production are no more pronounced than in the supply of tobacco and crops used in health-harming foods. Both categories of agricultural production are vulnerable to the above-noted risks and are impacted, and indeed the risks are compounded, by the duel process of efforts to control demand for these products and market instability.

How does input support affect agriculture?

The findings that demonstrate a positive impact of input supports are consistent with general policy shifts away from public support in the agricultural sector (and other public sectors). The absence of input support from government both contributes to and is a result of smallholder farmers entering into contract with private companies. These contractual relationships can improve production but also concentrate power with private entitites who then determine the quantity of product purchased, have power to evaluate the quality of the commodity and ultimately the price paid to the farmer [ 75, 76 ]. Such contracts often involve inflated prices for inputs and reduced prices offered for the commodity at market [ 77, 78 ]. Tobacco leaf-buying companies can attract farmers to enter into contracts under these unfavourable conditions because the arrangement facilitates easier access to inputs, and sometimes also cash loans, particularly when more traditional credit is scarce [ 79 ]. It must be recognised that such private investment is also likely to limit the operationalization of government efforts to increase production of healthy agricultural commodities. For example, where governments have withdrawn from providing extension services for tobacco, private companies have taken over [ 73, 74, 80 ]. In Kenya, the agricultural ministry does not provide input supports or extension services to tobacco because the government has listed tobacco as an unscheduled crop, thus taking a hands-off approach to tobacco production [ 73 ]. Farmers report that services provided by tobacco companies are often of high quality and they believe that this support contributes to improved yields. This suggests that governments may need to examine opportunities to curtail private sector investment in tobacco if alternatives are to be meaningfully pursued.

Why is there a need to apply existing knowledge of effective interventions targeting agricultural production and farm level economic factors?

There is a need to apply existing knowledge of effective interventions targeting agricultural production and farm level economic factors. Evaluation studies suggest that certain types of interventions are more effective than others. There is also a need to conduct rigorous evaluation studies on interventions specifically aiming to shape the tobacco and food supply. To date, such research remains scarce.

Why are commodities like tobacco and sugar attractive to farmers?

It is an uncontroversial fact that commodities like tobacco or sugar are attractive to farmers because of a combination of factors such as access to markets, contractual arrangements that allow access to inputs and loans, and other facilitators along the supply chain [ 84, 85, 86 ].

How has food production changed over the past century?

Food production has experienced massive shifts in the past century with the rise of agricultural technologies, enhanced refrigeration and transportation systems and most importantly the globalization of markets [ 26 ]. Global agriculture trade accounts for over 20% of global calorire production [ 13 ]. This shift has led to shifts from subsistence to export-driven crop production, which in turn has led to the homogenization of crop production [ 27 ]. This homogenization has reduced biological diversity in the food system, and “the global agricultural system currently overproduces grains, fats, and sugars while production of fruits and vegetables and protein is not sufficient to meet the nutritional needs of the current population” [ 28 ]. Although this shift has been credited with helping to reduce rates of global hunger, the substitution of nutrient rich crops for wheat, rice and maize has contributed to both undernutrition and obesity with concomitant increases in rates of cardiovascular disease and diabetes, particularly in low- and middle-income countries (LMICs) [ 29, 30, 31, 32 ]. For example, the rise in rates of diabetes in India has been attributed to the move away from high-density, protein-rich legumes towards rice and wheat [ 32 ]. Negin and colleagues provided an overview of the shifts in agriculture production in Asia and highlight that in India, “many of the secondary food grains such as pulses, which are major sources of protein in vegetarian Indian diets, as well as millets such as sorghum, pearl millet, and finger millet, which serve as staples in dryland areas and are rich in micronutrients, were underemphasized” [ 33 ]. This is a common observation in countries around the world and has led to an emerging consensus that agricultural production requires another major shift towards greater production of fruits and vegetables and nutrient-rich cereals and pulses [ 34 ].

What is the purpose of the review of the health and agricultural sector?

This review can inform dialogue between the health and agricultural sector and evaluative research on policy for alternatives to tobacco production and unhealthy food supply.

Why is tobacco important to agriculture?

Added to the challenge of controlling production is that if demand remains high, then reductions in production might lead to increases in prices for the commodity, potentially inducing growers to switch back to the production of that commodity. However, production is bound up in the rhetoric of opposition to demand reduction measures by unhealthy product-producing industries such as the tobacco industry [ 16, 17, 18 ]. A strong evidence base and a deep understanding of the theory and practice of agricultural production by health advocates is a critical part of overcoming likely political and economic challenges.

What is AGP in agriculture?

The Office of Agricultural Policy (AGP) boosts economic prosperity for American farmers and ranchers by opening foreign markets to American farm products; promoting transparent, predictable, and science-based regulatory systems overseas; and reducing unnecessary barriers to trade around the world.

What is the AGP?

The Office of Agricultural Policy supports American agriculture while protecting U.S. national security. AGP’s work contributes to the strong performance of the American agricultural sector, which exported $140 billion in 2018, resulting in a trade surplus of $10.9 billion.

Abstract and Figures

Our paper begins with a consideration of the causal relationships among productivity, farm structure, government farm payments and public investments in research and extension.

References (60)

The purpose of this paper is to explore the impact of changing agricultural policies on the productivity of agricultural crops and area in the Gezira scheme, Sudan.

What is the role of government in agriculture?

It is a government that supports development intelligently , by diagnosing accurately and continuously problems that emerge and playing a facilitating or enabling role for the sector’s growth . It is a government whose institutions are strong and have developed out of a country’s own historical experience and social context. While most governments provide infrastructure, agricultural research services and other public goods as indicated by Gale Johnson, the legitimate role of government in promoting development may be framed in a broader way. Dani Rodrik has provided an illuminating perspective on the role of government and the nature of its institutions and the policy reform process:

What should be the role of government, if not in production or distribution?

Then what should be the role of government, if not in production or distribution? The non-controversial roles of government have been clear enough: protection of property rights, enforcing contractual obligations to foster competition, and the provision of public goods such as agricultural research, technology, information and infrastructure. The more controversial roles involve redistributing assets through forced measures, stabilizing prices, absorbing risks and providing credit. If the government goes where private markets fear to tread, it needs to do so cautiously and with considerable safeguards.

What is Bardhan’s role in agriculture?

Bardhan has underscored the role of government in stimulating agricultural development in the modern context , and has described issues in the decentralization of governmental functions:

What are some goods and services that a competitive market would not supply at all or would provide in less than optimal amounts

These include public goods where consumption is not exclusive , such as maintenance of law and order, protection of civil rights, national defense, public parks, agricultural research, and some forms of communication….

What does the government need to do if private markets fear to tread?

If the government goes where private markets fear to tread, it needs to do so cautiously and with considerable safeguards. Gale Johnson has provided a clear definition of six traditional areas in which government action is needed.

How does government help Asia?

. . Government can help promote equality and alleviate poverty, policies that in East Asia contributed to growth. . . . the exact role of government will change over time.

Does dogma require government to assume responsibility for market failure?

It takes as dogma neither that markets by themselves will ensure desirable outcomes nor that the absence of a market, or some related market failure, requires government to assume responsibility for the activity. It does not even ask whether a particular activity should be in the public or the private sector.

What are the factors to consider when purchasing crop insurance?

Farmers weigh three main factors when deciding whether to purchase weather-related crop insurance: their estimated probability that a weather-related event will occur; the amount of loss that will be indemnified (never 100 percent); and the premium they must pay.

When did crop insurance reforms start?

In 1994, following the devastating floods of 1993, Congress passed the Federal Crop Insurance and Reform Act, increasing premium subsidies for all crop insurance products, while adding catastrophic coverage and revenue insurance options.

How has cropland changed over time?

cropland acreage has remained roughly constant for 100 years, relatively large amounts of less productive, or “marginal,” cropland have shifted in and out of production over time. Almost three-quarters of the cropland acreage that shifted into or out of cultivation between 1982 and 1997 had soil productivity below that of the average acre of cropland. Economic forces, such as changing commodity prices or production costs, are likely to induce farmers to shift marginal land in and out of production, while farmers will tend to keep highly productive cropland in cultivation. ERS research shows that, in general, low-productivity croplands are more environmentally sensitive than high-productivity land along several dimensions, including wind and water erosion and potential nutrient losses to water. Therefore, land-use changes on less productive cropland may have unanticipated environmental consequences.

Why are marginal lands more environmentally sensitive than highly productive land?

Because marginal lands are also more environmentally sensitive than highly productive land along several dimensions, cropland shifts have environmental, as well as economic, effects. Thus, agricultural and conservation programs that affect land use likely have greater effects on erosion and some other environmental factors than on production.

What is crop insurance?

The Federal Crop Insurance Program raises incentives to grow crops. A longstanding concern is that the program may maintain or increase crop cultivation in frequently flooded and other risky areas containing wetlands and other environmentally sensitive lands.

Why were premium subsidies increased?

The premium subsidies were increased significantly to encourage more producers to participate. Further subsidy increases were enacted by Congress in 1999-2000. Crop insurance participation increased with the growth in subsidies.

How many acres of land were insured in the US in 1990?

Insured acreage more than doubled from 90 million acres to 197 million acres between 1990-94 and 1995-99, and then rose to an average of 212 million over 2000-03. That is about 60 percent of cultivated cropland in the 48 contiguous States.

What is the Agriculture Task Force?

The Agriculture Task Force examines state and federal agricultural policy issues and serves as the conduit for state legislative communication with Congress, the U.S. Department of Agriculture, and other federal agencies. Pane_4_Col_4_8.

What is agriculture in rural America?

Agriculture continues to play a major economic role in rural America, along with manufacturing, services and trade. NCSL follows state legislative activities on agriculture and rural economic development, tracks changes in federal policy—including the Farm Bill—concerns on health care and education, and highlights novel approaches lawmakers …

How many food safety bills were passed in 2019?

Food Safety Legislation 2019. State legislatures introduced more than 700 bills regarding food and food safety in 2019, with 132 being enacted and 17 adopted into law. AGRICULTURE & RURAL DEVELOPMENT. Agriculture and Rural Development.

How many states have rural commissions?

Rural America is undergoing changes, and state legislatures are responding. Legislatures in nine states have initiated rural commissions and committees, dedicated to improving rural areas of their state.

What is the Natural Resources and Infrastructure Committee?

The Natural Resources and Infrastructure Committee is one of eight NCSL Standing Committees that educates Congress and federal agencies about state concerns and serves as a forum for state legislators and legislative staff to learn about and share information regarding programs and initiatives in other states.


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