Farm programs influence the parameters of typically estimated supply functions. We develop and apply an approach that uses detailed information about farm program incentives and constraints to identify underlying structural acreage response parameters when the data reflect behavior under complex government commodity programs. We illustrate the approach with data on rice acreage response to market price in the United States. For U.S. rice, estimates that fail to appropriately incorporate the program rules under which market data were generated are three to four times smaller than the structural parameters that are useful for most policy analysis or projections under alternative policies.

This two-part study investigates potential reforms of commodity programs in the context of the legislative debate on the 1995 farm bill. Brian D. Wright considers a farm bill written on a clean slate, unconstrained by previous policy. Such legislation would depart radically from the current policy structure. Bruce L. Gardner analyzes a set of options that make a noticeable difference for the main commodities, yet are reachable from current policy and have visible political support. If followed, Gardner's proposals would move agriculture along the path laid out by Wright.

This study develops and applies the concept of "effective support prices." Government-announced price supports for agricultural crops adjusted to reflect the stringency of acreage controls imposed on growers as a condition for obtaining price supports. Effective support prices are used as a means of estimating the impact of Government programs on planted acreages of seven major U.S. field crops. Also, where applicable, the study shows that effective diversion rates are strongly but inversely related to plantings of the crops. Market price influences became increasingly important in the seventies