000164516 001__ 164516
000164516 005__ 20210122073743.0
000164516 0247_ $$2doi$$a10.22004/ag.econ.164516
000164516 037__ $$a1639-2016-135168
000164516 041__ $$aeng
000164516 084__ $$aQ15
000164516 084__ $$aQ17
000164516 084__ $$aQ18
000164516 245__ $$aThe Effects of Direct Payments on Liquidity and Repayment Capacity of Beginning Farmers
000164516 260__ $$c2011
000164516 269__ $$a2011
000164516 270__ $$mjkropp@clemson.edu$$pKropp,   Jaclyn D.
000164516 270__ $$makatchova@uky.edu$$pKatchova,   Ani L.
000164516 300__ $$a30
000164516 336__ $$aWorking or Discussion Paper
000164516 490__ $$aUniversity of Kentucky Ag Econ Staff Papers
000164516 490__ $$a476
000164516 520__ $$aU.S. decoupled direct payments, paid to farm operators based on historic yields and base acreage under the 2002 Farm Bill, may alter a farmer’s access to credit or his ability to meet debt servicing obligations. Data from the U.S. Department of Agriculture (USDA) Agricultural Resource Management Survey (ARMS) for the years 2005, 2006 and 2007 are used.  We find a positive significant relationship between the level of direct payments (in dollars) and the term debt coverage ratio for experienced farmers, suggesting that direct payments improve repayment capacity. However, this relationship is not significant for beginning farmers. We also find a negative significant relationship between the number of base acres and the current ratio for experienced farmers, while this relationship lacks significance for beginning farmers. We provide evidence that decoupled direct payments impact a farmer’s liquidity and repayment capacity. This paper also contributes to the growing body of research investigating the mechanisms by which decoupled payments have the potential to distort current production.
000164516 650__ $$aAgricultural and Food Policy
000164516 650__ $$aAgricultural Finance
000164516 650__ $$aFinancial Economics
000164516 6531_ $$abeginning farmers
000164516 6531_ $$acreditworthiness
000164516 6531_ $$adecoupled payments
000164516 6531_ $$aliquidity
000164516 6531_ $$arepayment capacity
000164516 700__ $$aKropp, Jaclyn D.
000164516 700__ $$aKatchova, Ani L.$$1https://orcid.org/0000-0002-7307-4073
000164516 8564_ $$91f801f70-033e-4f01-b91c-b276435c6c4d$$s121924$$uhttps://ageconsearch.umn.edu/record/164516/files/Beginning%20Farmers%20and%20Direct%20Payments.pdf
000164516 887__ $$ahttp://purl.umn.edu/164516
000164516 909CO $$ooai:ageconsearch.umn.edu:164516$$pGLOBAL_SET
000164516 912__ $$nSubmitted by Ani Katchova (akatchova@uky.edu) on 2014-03-02T23:04:22Z
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  Previous issue date: 2011
000164516 913__ $$aLicense granted by Ani Katchova (akatchova@uky.edu) on 2014-03-02T22:55:45Z (GMT):

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000164516 982__ $$gUniversity of Kentucky, Department of Agricultural Economics>Staff Papers