TRANSFERS TO AGRICULTURE: LINKS TO LOBBYING

The objective of this paper is to systematically incorporate lobbying in a microeconomic model of the profit maximizing farmer, derive testable implications of the model and apply it to establish the link, or lack thereof, between policy benefits transferred to farmers and their lobbying expenditures. Policy transfers will be measured by the Producer Subsidy Equivalent (PSE), a comprehensive annual dollar measure of transfers to producers that results from government intervention in agriculture (Josling and Tangerman, 1988)