So part of the lost subsidies would be replaced by higher yields. The largest single expense for any farmer is the cost of his land. And this is where the farm program has its biggest impact. The first thing farmers want to know when a neighbor's farm comes up for sale is the size of its crop base. When farm subsidies diminish, the price of land falls.
Farmers compete with one another for land.
Farm policy has the effect of subsidizing established farmers who own much of their land, and making it more difficult for younger farmers to buy or rent land to establish themselves. Farm programs are often touted as an attempt to save the family farm. But when the capitalized value of subsidies raises the costs to families who want to farm, the programs serve as a barrier to entry. Not surprisingly, the average age of farmers is well over 50. Cuts in farm subsidies would allow easier entry into farming, and less expensive transfer of farms between generations.