This article demonstrates that normality test procedures that include individual detrending of short-term panel data can severely reduce the power of normality tests and strongly bias normality tests in a Type II direction. An alternative error component implicit detrending procedure is suggested that demonstrates higher power for the distributions examined. Both procedures are applied to a large data set with normality of yield residuals being rejected. Assuming normality is shown to reduce potential premium rates for a large number of producers in an existing crop insurance product. Copyright 2003, Oxford University Press.

The economic environment of agricultural producers has been influenced by formal U.S. agricultural policy for more than seventy years. Among the first pieces of New Deal legislation proposed by incoming President Franklin D. Roosevelt, was a farm program designed to address declines in crop prices and net farm income. Key features of the Agriculture Act of 1933 included mandatory price support for specified commodities, direct subsidy payments to farmers, and supply controls. Farm programs, once viewed as temporary and supplementary to agricultural earnings, are increasingly viewed as permanent and of major proportion. Gardner examined the relationships between U.S. farm commodity programs and U.S. farm structure, while others (see Sumner for concept, evidence, and implications) have examined farm programs and specific crops. Gardner (2002), and Weersink et al. analyzed the effects of farm program programs upon land values. These studies examined various aspects of agricultural policy including whether farm program payments have enhanced land prices and landowner wealth rather than the welfare of producers. While it would seem logical that revenueenhancing farm programs would increase land values, reliably estimating the magnitudes of farm program effects upon land values is an empirically challenging task. Both statistical and budgeting-based methodologies have been used to estimate the share of land prices generated by farm program payments. Statistically based studies are complicated by the fact that both real per acre crop receipts Saleem Shaik is post-doctoral research associate,

This study examines the effects of both farm price support programs and federally subsidized crop insurance programs upon the profitability, capital structure, and financial survival rates of High Plains wheat producers. The alternative farm programs are analyzed in an intertemporal dynamic setting. Results indicate that the producer's first response to risk is to restrict the use of debt. Price support programs and crop insurance are substitutes in reducing producer risk. The availability of crop insurance in a setting with price supports allows producers to service higher levels of debt with no increase in risk. Copyright 1996, Oxford University Press.

Thirteen cropping systems were analyzed with respect to profitability and risk for east-central Nebraska. The systems were developed from 1) a four-year rotation containing a small grain, 2) two row crop rotations, 3) three continuous cropped alternatives, and 4) combinations of continuous cropped alternatives. Three systems were developed from the four-year rotation including two alternative treatments of inorganic chemicals as well as an organic alternative. Eight years of experimental yields, historical prices, and estimated costs were combined to estimate net returns for each of the thirteen systems. Risk was analyzed as net return variability using statistical characteristics of the net return series. The stability component of rotation risk was separated from the diversification component. We found rotations to have higher average net returns than continuously cropped systems. Different chemical treatments (including organic) had little impact on profitability. Rotations had lower return variability than most continuous crops. The organic treatment did not decrease variability of returns compared to other chemical systems.