AGRICULTURAL STRUCTURAL ADJUSTMENT TO GOVERNMENT POLICIES: EMPIRICAL EVIDENCE
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Economic theory alone cannot predict the impacts of government payments on farm structure. We estimate a 5-equation model for the 1978-96 period to measure the impacts using state micro and macro data sets. We found that government payments were positively associated with farm size and farm exits, but negatively associated with the extent of consolidation in farm production and the off-farm work of operators.