Understanding agricultural policy-related terminology is critical when reviewing scientific evidence reported in the media or policy documents. [Match each term to the appropriate definition by selecting the letter from the second column that best matches with the term in the first column in the blank provided. Each term should only be used once].

Note: If you missed any of the terms below, please review the bold-faced terms in Chapter 2 of the Wilde textbook.

Group of answer choices

Vertical integration

[ Choose ] A government policy to reduce the quantity planted or sold. Program which pays farmers when the estimated revenue falls below a guaranteed level in the event of unforeseen weather conditions, market swings, etc. Nonmarket coordination between different marketing level using contracts or ownership structures. A government policy in which producers are offered a direct sum payment which is decoupled from the farmer's current production decisions Occurs when the availability of insurance reduces the farmer's incentive to avoid potential shortfalls, leading to riskier farming or increased production in environmentally stress regions. A government policy in which producers are offered a payment for the difference between a target price and price to the buyer. A government policy that maintains a price higher than the market price.

Price support

[ Choose ] A government policy to reduce the quantity planted or sold. Program which pays farmers when the estimated revenue falls below a guaranteed level in the event of unforeseen weather conditions, market swings, etc. Nonmarket coordination between different marketing level using contracts or ownership structures. A government policy in which producers are offered a direct sum payment which is decoupled from the farmer's current production decisions Occurs when the availability of insurance reduces the farmer's incentive to avoid potential shortfalls, leading to riskier farming or increased production in environmentally stress regions. A government policy in which producers are offered a payment for the difference between a target price and price to the buyer. A government policy that maintains a price higher than the market price.

Moral hazard

[ Choose ] A government policy to reduce the quantity planted or sold. Program which pays farmers when the estimated revenue falls below a guaranteed level in the event of unforeseen weather conditions, market swings, etc. Nonmarket coordination between different marketing level using contracts or ownership structures. A government policy in which producers are offered a direct sum payment which is decoupled from the farmer's current production decisions Occurs when the availability of insurance reduces the farmer's incentive to avoid potential shortfalls, leading to riskier farming or increased production in environmentally stress regions. A government policy in which producers are offered a payment for the difference between a target price and price to the buyer. A government policy that maintains a price higher than the market price.

supply control

[ Choose ] A government policy to reduce the quantity planted or sold. Program which pays farmers when the estimated revenue falls below a guaranteed level in the event of unforeseen weather conditions, market swings, etc. Nonmarket coordination between different marketing level using contracts or ownership structures. A government policy in which producers are offered a direct sum payment which is decoupled from the farmer's current production decisions Occurs when the availability of insurance reduces the farmer's incentive to avoid potential shortfalls, leading to riskier farming or increased production in environmentally stress regions. A government policy in which producers are offered a payment for the difference between a target price and price to the buyer. A government policy that maintains a price higher than the market price.

Deficiency payment

[ Choose ] A government policy to reduce the quantity planted or sold. Program which pays farmers when the estimated revenue falls below a guaranteed level in the event of unforeseen weather conditions, market swings, etc. Nonmarket coordination between different marketing level using contracts or ownership structures. A government policy in which producers are offered a direct sum payment which is decoupled from the farmer's current production decisions Occurs when the availability of insurance reduces the farmer's incentive to avoid potential shortfalls, leading to riskier farming or increased production in environmentally stress regions. A government policy in which producers are offered a payment for the difference between a target price and price to the buyer. A government policy that maintains a price higher than the market price.

Direct payment

[ Choose ] A government policy to reduce the quantity planted or sold. Program which pays farmers when the estimated revenue falls below a guaranteed level in the event of unforeseen weather conditions, market swings, etc. Nonmarket coordination between different marketing level using contracts or ownership structures. A government policy in which producers are offered a direct sum payment which is decoupled from the farmer's current production decisions Occurs when the availability of insurance reduces the farmer's incentive to avoid potential shortfalls, leading to riskier farming or increased production in environmentally stress regions. A government policy in which producers are offered a payment for the difference between a target price and price to the buyer. A government policy that maintains a price higher than the market price.

Crop insurance

[ Choose ] A government policy to reduce the quantity planted or sold. Program which pays farmers when the estimated revenue falls below a guaranteed level in the event of unforeseen weather conditions, market swings, etc. Nonmarket coordination between different marketing level using contracts or ownership structures. A government policy in which producers are offered a direct sum payment which is decoupled from the farmer's current production decisions Occurs when the availability of insurance reduces the farmer's incentive to avoid potential shortfalls, leading to riskier farming or increased production in environmentally stress regions. A government policy in which producers are offered a payment for the difference between a target price and price to the buyer. A government policy that maintains a price higher than the market price.