The US government has been actively involved in the production and trade of agricultural products in the world market. Corn as an agricultural product has not been spared. The minimum price for corn has been set above the domestic and world market prices. Such pricing policies have naturally generated surpluses that have been traded in the world market at subsidized prices. At times, the US has used acreage control policy to help reduce the level of excess supply. Price and income subsidies also have been used to complement acreage control policy when surpluses are immense. The empirical results have shown that these interventions have impacted on the world price of corn and subsequently on the foreign exchange earnings of the competing exporting countries. However, the issue of how significant these instabilities have been still remains and is more of a normative issue. The measure of the opportunity costs of these policies has provided an idea of the size of compensation to the competing countries of Argentina and Thailand. The last part of the dissertation investigates on the possible effects of the US policies on the behavior of Argentina and Thailand. The results obtained cannot confirm nor reject the premisses of US policies' harmful impacts. Such inconclusive outcome may be tied back to the inconsistency of the trading policy setting in Argentina and Thailand. Based on economic theory, suggestions have been made regarding the establishment of international stabilization and compensatory schemes to help move the world corn economy toward a Pareto optimal production level.

The Farm Bill is a large omnibus bill that covers many titles, including commodity programs, and accounted for $23.9 billion in government spending in 2006. The purposes of this study are to determine if commodity variables are the only variables that are closely correlated to government commodity payments, and if government payments are distributed equitably by Farm Resource Region, based on the inequitable distribution of payments cited by other researchers. Data included economics, operator characteristics, farm typologies, tenure, and geographic variables. Kendall’s correlations and location quotients examined the relationship between these variables and government payments. Choropleth maps were created to visually examine the relationships. This study found that corn, soybean, wheat, and cropland variables were strongly correlated to government payment variables, supporting the hypothesis. However, other variables were also strongly correlated to government payment variables, and payments varied widely by Farm Resource Region. The hypotheses were rejected. / Department of Natural Resources and Environmental Management

Congress has directed the Department of Agriculture to perform research and establish a pilot program to determine the feasibility of using regulated agricultural commodity options trading for the benefit of farmers to protect them from fluctuations in the value of their commodities. The purpose of this study is to examine the prospects for using put options in place of current farm income support programs. It focuses on the feed corn program in its analysis. It also examines available literature on the subject of using futures and options contracts to replace current farm programs. The study uses the Black model for the pricing of options on futures contracts to estimate prices of options that would provide a level of income protection similar to that afforded by the current income support program for corn farmers. It goes on to estimate the fair value of the implicit put options granted by the Federal government for the 1982 - 1989 crops of corn and compares those values to actual program costs. The results suggest the possibility that program costs are higher than they need be because government price and income guarantees are provided at a cost in excess of the fair market values of the current program's implicit options and that transfer of some or all of the risk-bearing role to the private sector would result in reduced government costs. / Master of Arts