The Impact of Crop Minimum Support Prices on Crop Selection and Farmer Welfare in the Presence of Strategic Farmers

Author(s):  
Prashant Chintapalli ◽  
Christopher S. Tang
Author(s):  
Neha Gupta

Abstract This paper reviews rice procurement operations of Government of India from the standpoints of cost of procurement as well as effectiveness in supporting farmers’ incomes. The two channels in use for procuring rice till 2015, were custom milling of rice and levy. In the first, the government bought paddy directly from farmers at the minimum support price (MSP) and got it milled from private millers; while in the second, it purchased rice from private millers at a pre-announced levy price thus providing indirect price support to farmers. Secondary data reveal that levy, despite implying lower cost of procurement was discriminated against till about a decade back and eventually abolished in 2015 in favor of custom milling, better trusted to provide minimum price support. We analyze data from auctions of paddy from a year when levy was still important to investigate its impact on farmers’ revenues. We use semi-nonparametric estimates of millers’ values to simulate farmers’ expected revenues and find these to be rather close to the MSP; a closer analysis shows that bidder competition is critical to this result. Finally, we use our estimates to quantify the impact of change in levy price on farmers’ revenues and use this to discuss ways to revive the levy channel.


Author(s):  
Masood Ahmed

The rural population percentage decreased from 82.7% to 68.9% in 2011, even though there is an increase in the total rural population, which stands at 833.7 million, and the rural population were now more than three times compared to the population seven decades ago. Another observation is the decrease in cultivators percentage from 71.9% to 45.1 %, while agriculture labour increase from 28.1% to 54.9% during the same period. Despite the increase in irrigated land and net area sown, the average holdings' size under the farmers is continuously decreasing, and it requires a study to look into the reasons. The research probes the role of Minimum Support Price (MSP) in supporting farmers and measuring market price above MSP needed to help marginal and small farmers remain above the poverty level. It explains how different market rates above MSP have a different impact on different categories of agriculture landholding. The study works on developing a common model that relates the impact of MSP on different farmers categories. The model can be generalized to all crops and regions and useful in designing policies that focus on uplifting the income of agricultural farmers.


2019 ◽  
Vol 2 (1) ◽  
pp. 17
Author(s):  
Prayudha Ananta

Provision of IUPHKm by the Ministry of Environment and Forestry (KLHK) is to improve the people’s economy. Social forestry which was once illegally managed by the people, has now been legalized by the government through the KLHK. This study aims to find out how the impact of the provision of IUPHKm on farmer welfare in Air Naningan Village, Tanggamus Regency. The method used is an exploratory and descriptive method. The analysis used is crosstabulation. The results of this study were that after farmers in Air Naningan Village obtaining IUPHKm, their economy is increasesing as indicatet by : (1) their income increased by an average of 142.73 percent; (2) they are able to buy 1 to 3 units of motorcycles; (3) they have a permanent house.


2019 ◽  
Vol 4 (2) ◽  
pp. 53
Author(s):  
Rizki Gemala Busyra

Jambi Province has implemented rice cultivation technology for food security includes land optimization, improved cropping patterns, provision of superior seeds, appropriate fertilization doses, control of Plant Disturbing Organisms and harvesting. Tanjabtim Regency has implemented rice cultivation technology including rice cultivation twice a year known as GertakTanpaDusta and Planting rice with twice harvests. This Study focused on the application of rice cultivation technology. The success of the application of rice cultivation technology in increasing both of cropping index and rice production requires an evaluation to see its impact, it is necessary to know how much is this technology in increase farmers' income by increasing the farmer welfare. This study aimed to determine the impact of the application of rice cultivation technology on the farmer welfare. This study used the model estimation method is 2SLS, by building 3 structural equations and 1 identity equation. The results showed that the application of rice cultivation technology will improve the farmer welfareas seen from the increase of land area, rice productivity and income of rice farmers.Keyword :Cultivation Technology,Welfare, Farmer AbstrakDalam menciptakan ketahanan pangan pada komoditas padi, maka Provinsi Jambi melakukan penerapan teknologi budidaya padi yang meliputi optimalisasi lahan, perbaikan pola tanam, penyediaan benih unggul, dosis pemupukan yang tepat, pengendalian Organisme Pengganggu Tanaman (OPT) dan pemanenan. Kabupaten Tanjabtim telah menerapkan teknologi budidaya padi diantaranya penanaman padi dua kali setahun yang dikenal dengan Gertak Tanpa Dusta (Gerakan Serentak Tanam Padi Dua Kali Setahun) dan Penanaman padi dengan dua kali panen yang dikenal dengan Senam Dupa (Sekali Tanam Dua Kali Panen). Pada Penelitian ini penelitihanya berfokus pada penerapan teknologi budidaya padi berupa program Getak Tanpa Dusta. Keberhasilan penerapanteknologi budidaya padi meningkatkan indeks pertanaman dan produksi padi memerlukan evaluasi untuk melihat dampaknya, maka perlu mengetahui seberapa besar teknologi ini dalam meningkatkan pendapatan petani yang diikuti dengan peningkatan kesejahteraan petani padi. Penelitian ini bertujuan untuk mengetahui dampak penerapan teknologi budidaya padi terhadap kesejahteraan petani padi.Penelitian ini menggunakan metode estimasi model yang digunakan adalah 2 SLS, dengan membangun 3 persamaan struktural dan 1 persamaan identitas. Hasil penelitian ini memperlihatkan bahwa penerapan teknologi budidaya padi meningkatkan kesejahteraan petani yang dilihat dari peningkatan areal, produktivitas padi dan pendapatan petani padi.Kata Kunci : Teknologi Budidaya, Kesejahteraan, Petani Padi


Energies ◽  
2015 ◽  
Vol 8 (6) ◽  
pp. 6033-6058 ◽  
Author(s):  
Pål Börjesson ◽  
Thomas Prade ◽  
Mikael Lantz ◽  
Lovisa Björnsson

2019 ◽  
Vol 1 (3) ◽  
pp. 80-86
Author(s):  
Muhammad Aamir Shahzad ◽  
Amar Razzaq ◽  
Ping Qing

Wheat is Pakistan's main food and strategic crop. Currently, the government controls wheat prices through a minimum support price (MSP) policy to encourage production. However, despite the increase in wheat production, input costs and output prices have been increasing over the years. This paper aims to analyse the impact of wheat support price policies. We use data from different government sources to estimate the financial implications of MSP and compare the support price policies of India and Pakistan. We find that Pakistan’s current minimum support price policy encourages farmers to produce larger quantities of wheat, but this places a heavy financial burden on the country's finances. Our results indicate that the higher MSP of wheat has made the country lose its competitiveness in the international market. Besides, we found that the cost of wheat production in Pakistan is much higher than in India. These higher production costs force the government to raise the MSP to maintain farmers' profitability. The high MSP is guaranteed by subsidizing the procurement and release of wheat, which imposes a heavy financial burden on government finances. In addition, the rise in wheat prices in recent years has also hurt consumers. Policymakers can redistribute subsidies by subsidizing wheat inputs, especially fertilizers and seeds, to reduce production costs. To this end, the best policy intervention may be to provide input subsidies rather than subsidies on purchase prices. A reduction in input costs will correspondingly reduce output prices, which will increase farmers' profitability, consumer surplus and the international competitiveness of Pakistani wheat.


Sign in / Sign up

Export Citation Format

Share Document