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Abstract

This paper examines the joint impact of wheat market deregulation and removal of the wool Reserve Price Scheme on Australian wheatbelt farmers using a simple model of land allocation between the two products and empirical details of the impact of the two policy changes on farmers' uncertain economic environment. It is shown that key parameters are wool micronage, wheat yield variability and the presence or not of a wool price ceiling due to stockpile disposal. Consequently, important regional differences in welfare impacts and supply responses may exist and these may be of significance to the mechanics of stockpile disposal.

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