Mandatory supply controls versus flexibility policy options for encouraging sustainable farming systems

Abstract

Link to this article: http://journals.cambridge.org/abstract_S088918930000463XHow to cite this article: Thomas L. Dobbs and David L. Becker (1992). Mandatory supply controls versus exibility policy options for encouraging sustainable farming systems.Abstract We analyzed two sets of farm policy options, representing different ideological approaches to government involvement in agriculture y to estimate their effects on the relative economic attractiveness of "sustainable" and "conventional" farming systems. The mandatory supply control approach through strict acreage limitations on program crops, represents a strong government role in commodity supply management. The Normal Crop Acreage approach, on the other hand, allows farmers greater flexibility in deciding what crops to grow. We used economic models of five pairs of case study farms indifferent agroclimatic areas of South Dakota, covering corn-soybean, spring wheat, and winter wheat growing regions. Mandatory restrictions on the planted acreage of "program" crops, including soybeans, were found to favor the conventional systems, because they induced high prices for crops that predominate in conventional systems, especially corn, soybeans, and wheat. In principle, however, mandatory acreage controls could require compliance with certain sustainable agriculture practices. Normal Crop Acreage (NCA) proposals can encourage greater use of sustainable farming systems. Where conventional corn and soybean production is relatively profitable, as in parts of eastern South Dakota, NCA options by themselves appear insufficient to induce changeovers to sustainable cropping systems. In wheat growing areas of northern and western South Dakota, however, where the two systems often are about equally profitable, NCA policies could promote sustainable systems, particularly if deficiency payments are not reduced for harvesting legumes and other non-program crops on NCA base. To have this positive effect, NCA policies must be introduced gradually and structured to limit adverse effects on the markets for legumes and other non-program crops that are important in sustainable rotations.

Planting flexibility: Implications for agricultural sustainability

“…Many other studies link agricultural production to surface and groundwater quality deterioration [Khan and Lian, 1989;Nielsen and Lee, 1987;O'Hare et al, 1985;Richardson et al, 1991;Sun et al, 1992;Taylor et al, 1991]. The environmental effects of increased planting flexibility require close examination [Dobbs and Becker, 1992;Painter and Young, 1994;Tobey and Reinert, 1991]. Agricultural production needs to be analyzed as an integrated economic and environmental system to determine the relative efficiency of alternative systems, the relationships between environmental quality and economic performance, the tradeoffs among environmental attributes, and the regional variation in economic and environmental effects.…”

“…Numerous studies of the Food Security Act of 1985 and the 1990 Food, Agriculture, Conservation, and Trade Act (FACTA) have demonstrated a bias of commodity programs toward more intensive cropping systems [Dobbs and Becker, 1992;Duffy and Taylor, 1994;Faeth et al, 1991;Gill and Daberkow, 1991;Glauber, 1988;Perry et al, 1989;Setia, 1992;Westcott, 1991]. These studies illustrate that deficiency payments, set-asides, and base acreage provisions can adversely affect the relative profitability of more sustainable production systems.…”