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Effects of Government Programs on Rice Acreage Decisions under Rational Expectations: The Case of Taiwan
Author(s) -
Huang CH
Publication year - 1992
Publication title -
american journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.949
H-Index - 111
eISSN - 1467-8276
pISSN - 0002-9092
DOI - 10.2307/1242485
Subject(s) - government (linguistics) , production (economics) , rational expectations , economics , agricultural economics , business , public economics , microeconomics , macroeconomics , philosophy , linguistics
Abstract The effects of government programs on rice production in Taiwan are examined under the rational expectations hypothesis. Results suggest that a crop‐shifting program designed to divert rice production to other targeted crops was unsuccessful because of contradictory government programs. Under rational expectations, the marginal effects of a price‐support program on acreage decline as soon as targeted price is no longer increasing.