World Agricultural Markets: Implications for U.S. Food and Agricultural Policy

Extract

In the absence of agricultural policy, the behavior of the agricultural sector is dictated by market forces. Any agricultural policy, other than one of “hands off—let the market forces rule,” is dependent upon programmatic tools which in one way or another attempt to interfere or modify behavior of the sector. If it is government's objective to design and implement a set of programs which will distort market behavior so as to achieve policy goals with minimum negative side effects, it is essential that policymakers understand the kind of market environment within which the U.S. farm sector exists and how this market is likely to behave, given alternative interferences.