INSTABILITY AND RISK IN U.S. AGRICULTURE

Abstract

The U.S. government has been extensively involved in providing income support and risk management policies for U.S. farmers over the last 65 years. Risk management policies have included crop insurance, disaster relief, and in recent years, revenue insurance. Recent policy changes signaled an intention on the part of policy makers, at least in principle, to move U.S. agriculture toward the free market. Low commodity prices and localized droughts, however, have brought about renewed calls for direct income assistance. In this paper, we discuss the role of the government in providing policies to address income shortfalls and risk in agriculture. Problems and inconsistencies with policies are identified and discussed. Implications for international markets are also highlighted.agriculture, crop insurance, government policy, risk management, Agricultural and Food Policy, Risk and Uncertainty,