The Production Response of a Cotton/Grain Farm to the Elimination of Commodity Support Programs

Abstract

The Production response of a farm in the High Plains of Texas to the elimination of support programs for certain agricultural commodities in the Unites States is estimated using duality theory. Linear programming methods were used to derive optimal profit maximizing combination's of enterprises with current farm programs and without farm programs for a cotton/grain farm. An indirect profit function was estimated using ordinary least squares methods. Duality theory was used to derive the farm supply functions for each commodity with and without farm programs. The results indicate that a short-run increase in the supply of each commodity due to shifts of the supply of each commodity due to shifts of the supply curves would be expected.+