Agricultural Policy as a Social Engineering Tool

efficient allocation of resources in the countries where the measures are implemented.
Thus whether farm operators place greater importance on the short-term economic
benefits that result from social engineering policies over the wider resource allocation
issues that result from their implementation is an empirical question.

To examine that question the paper uses survey data in a New Jersey case study.
The paper hypothesizes that given the importance of agricultural trade to farm balance
sheets, farm operators are unlikely to support agricultural policy as a social engineering
tool where farm sales might be adversely impacted. To test that hypothesis the paper
proceeds as follows. The next section examines briefly examines the literature on policy
intervention. This section is followed by the data source and a description of the data.
This section is followed by the methodology used in the study. The variable specification
and working hypotheses section provide the rationale for the variables chosen in the
study. This section is followed by empirical results. The paper concludes with a
discussion and policy implications.

Review of the Literature

Most economists agree that free trade and open markets create jobs and raise the standard
of living (see Quinn, 1997; Edwards, 1998; Pagano, 1993). This notion is grounded in
the belief that market allocations of resources are efficient and that such allocations foster
significant welfare improvements. Despite this notion, policymakers often intervene in
the market and erect trade barriers as a mechanism for redistributing income. This
intervention is often justified as a means of supporting low family farm income although
few farm operators receive program benefits or in some cases richer farm operators
receive most of the program benefits. Thompson (2005) argues that two-thirds of U.S.

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