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        Market Oriented Revenue Assistance for Farmers: A Case Study of the United State’s ACRE Program

        Carl Zulauf,Chan-Hee Rhew,Sang-Hyo Kim 한국유통과학회 2016 유통과학연구 Vol.14 No.11

        Purpose - Intense debate is occurring over support for farmers in Korea, specifically on the justification, policy design, and equality issues of the farm support programs. Given this debate, a new type of farm program in the US, a market flexible revenue program(the Average Crop Revenue Election, ACRE), is examined. ACRE stands in contrast to traditional programs that tie payments to price and have parameters that are fixed or change only infrequently. Research design, data, and methodology – Based on the ACRE program formulas, the potential payments are estimated by crop year, program crop and geographical area using the FSA acreage and payment rate data. Results - If all US farm program acres were in ACRE over the 2009-2013 crop years, payments would have totaled $7.95 billion or 1.2 percent of average market receipts for US crops. Enacting ACRE as a revenue program instead of a similarly-structured price-only program increased payments by $1.75 billion or 28 percent. Conclusions - Potential payments by ACRE largely reflected the distribution of the value of production across the program crops eligible for ACRE as well as across state geographical areas. If program parameters can be made acceptable and if data availability issues can be addressed, market flexible revenue programs offer a farm policy option that can address many of the concerns that have arisen over farm policy in Korea.

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        Explaining Share of Farm Loss Systemic with County Loss in the United States?

        김상효,임진순,Carl Zulauf 한국유통과학회 2017 유통과학연구 Vol.15 No.11

        Purpose - Relationship between farm and county losses determines whether the county program provides too little, too much, or similar amount of assistance relative to the loss on an individual farm. A review of the literature finds limited analysis of the determinants of this relationship. This paper conducts such an analysis using farm-level yield data. Research design, data, and methodology - Farm-level yield data from Illinois and Kansas farm business management associations are used for to calculate the correlation between farm and county loss and the share of farm loss systemic with county loss, and also for the regression analysis. Results - Average share of farm loss systemic with the county loss lies between 42% and 68%. The correlation between farm and county yield/revenue deviation from expected value is statistically significant in all four models. The coefficient is positive, implying the higher the correlation, the larger the share of farm loss that is systemic with the county loss. Conclusions - The findings of this study are consistent with the existing literature which argues that county variability may not be closely associated with farm variability. The findings of this study thus raise questions about the efficacy of area yield and revenue insurance products in helping farmers manage their risk.

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