agricultural policy


Also found in: Wikipedia.
Agricultural policyclick for a larger image
Fig. 6 Agricultural policy. (a) The short-term shifts in supply (S) and their effects on price (P) and quantity (Q).

(b) Long-term shifts caused by the influence of productivity improvement on supply.

agricultural policy

a policy concerned both with protecting the economic interests of the agricultural community by subsidizing farm prices and incomes, and with promoting greater efficiency by encouraging farm consolidation and mechanization.

The rationale for supporting agriculture partly reflects the ‘special case’ nature of the industry itself: agriculture, unlike manufacturing industry, is especially vulnerable to events outside its immediate control. Supply tends to fluctuate erratically from year to year, depending upon such vagaries as the weather and the incidence of pestilence and disease, S1, S2 and S3 in Fig. 6 (a), causing wide changes in farm prices and farm incomes. Over the long term, while the demand for many basic foodstuffs and animal produce has grown only slowly, from DD to D1D1 in Fig. 6 (b), significant PRODUCTIVITY improvements associated with farm mechanization, chemical fertilizers and pesticides, etc., have tended to increase supply at a faster rate than demand, from SS to S1 S1 in Fig. 6 (b), causing farm prices and incomes to fall (see MARKET FAILURE).

Farming can thus be very much a hit-and-miss affair, and governments concerned with the impact of changes in food supplies and prices (on, for example, the level of farm incomes, the balance of payments and inflation rates) may well feel some imperative to regulate the situation. But there are also social and political factors at work; for example, the desire to preserve rural communities and the fact that, even in some advanced industrial countries (for example, the European Union), the agricultural sector often commands a political vote out of all proportion to its economic weight. See ENGEL'S LAW, COBWEB THEOREM, PRICE SUPPORT, INCOME SUPPORT, COMMON AGRICULTURAL POLICY, FOOD AND AGRICULTURAL ORGANIZATION.

References in periodicals archive ?
BIRDLIFE Cyprus said yesterday that the Cypriot EU presidency had concluded its work on the Common Agricultural Policy (CAP) reform "by digging a grave for greening".
National Agricultural Policy Center Director Atieh al-Hindi said the program includes 53 projects at a total cost of SYP 200 billion.
The European Commission issued, on 11 May, a call for tenders for a study on the contribution of Common Agricultural Policy measures to biodiversity and habitat preservation.
17 December 2009: EU Commissioner For Agriculture Marianne Fischer Boel said simplification of the Common Agricultural Policy is not a "done deal".
PAUL Flynn, Labour MP for Newport, has recently attacked Plaid Cymru over their refusal to back Chancellor Alistair Darling's campaign to reform the Common Agricultural Agricultural Policy.
But he made clear that bringing the rebate to an end could only come in parallel with radical reform of the EU's hugely expensive Common Agricultural Policy.
I doubt that anyone can substantiate the estimate that scrapping the Common Agricultural Policy (CAP) would raise per capita incomes in sub-Saharan Africa by 13 per cent.
Part of the Brussels' attempts to reform the Common Agricultural Policy, the Commission has proposed the complete decoupling of tobacco growing aid from production, converting these payments into direct subsidies to farmers, as a transitional stage towards the gradual disappearance of the tobacco grants.
Gianessi, former program director and senior research associate at the National Center for Food and Agricultural Policy (NCFAP), a private nonprofit, non-advocacy research organization, will focus CPRI's research on the use and economic benefits of pesticides in U.S.
The common market has no common agricultural policy. Without one, it will be difficult to press for concessions from members of the North American Free Trade Agreement (Nafta) on agricultural products.
The Red and the Green and Agriculture and the State show us where socialism took agriculture and where--now that capitalism stands alone--current thinking is on agricultural policy, respectively.
Czech Agriculture Minister Miroslav Toman and his Finnish counterpart and current EU Council chairman Jarmila Leppa spoke about the priorities of the Common Agricultural Policy (CAP) and establishing closer cooperation in its preparation at bilateral talks.

Full browser ?