Are “Decoupled” Farm Program Payments Really Decoupled? An Empirical Evaluation

17 Pages Posted: 22 Apr 2020

See all articles by Barry K. Goodwin

Barry K. Goodwin

North Carolina State University

Ashok K. Mishra

Arizona State University (ASU) - W.P. Carey School of Business

Date Written: February 2006

Abstract

This analysis utilizes farm‐level data to evaluate the extent to which U.S. farm program benefits, particularly direct payments, bring about distortions in production. The issue is important in WTO negotiations and in the debate over the distortionary effects of decoupled (“green‐box”) payments. Our results suggest that the distortions brought about by AMTA payments, though statistically significant in some cases, are very modest. Larger effects are implied for market loss assistance payments. Probit models suggest that AMTA payments do not influence the likelihood that agents will acquire more land. Our results are reinforced using an aggregate county‐level acreage model.

Keywords: acreage response, decoupled payments, WTO green box

Suggested Citation

Goodwin, Barry K. and Mishra, Ashok K., Are “Decoupled” Farm Program Payments Really Decoupled? An Empirical Evaluation (February 2006). American Journal of Agricultural Economics, Vol. 88, Issue 1, pp. 73-89, 2006, Available at SSRN: https://ssrn.com/abstract=3581937 or http://dx.doi.org/10.1111/j.1467-8276.2006.00839.x

Barry K. Goodwin (Contact Author)

North Carolina State University

Hillsborough Street
Raleigh, NC 27695
United States

Ashok K. Mishra

Arizona State University (ASU) - W.P. Carey School of Business ( email )

235M Santan Hall
Tempe, AZ 85287-3706
United States
4807271288 (Phone)
4807271961 (Fax)

HOME PAGE: http://https://apps.wpcarey.asu.edu/directory/people/profile.cfm?person=2259044

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