The concept of parity provides the rationale for government price on farm products.

The concept of parity in agriculture refers to the idea of maintaining a balance between the income of farmers and the costs they incur in producing their goods. This is often used as a justification for government intervention in agricultural markets, such as setting minimum prices for farm products.

Here are the steps to understand this concept:

1. Understanding Parity: Parity is a standard used in agriculture that compares prices farmers receive for their crops and livestock to the prices they pay for inputs like seed, fertilizer, feed, and machinery. The goal is to maintain a balance or "parity" between these two sets of prices.

2. Role of Government: If the market prices for farm products fall below the costs of production, farmers could potentially go out of business. To prevent this, governments may step in to set minimum prices for farm products. This is known as price support.

3. Rationale for Price Support: The rationale behind this is to ensure that farmers can continue to produce food and other agricultural products, even when market conditions are unfavorable. By guaranteeing a minimum price, governments can help to stabilize farm incomes and protect farmers from the volatility of agricultural markets.

4. Impact on Consumers and Taxpayers: While price supports can benefit farmers, they can also lead to higher prices for consumers and taxpayers. This is because the cost of these programs is often passed on to consumers in the form of higher food prices, and to taxpayers in the form of government spending.

5. Controversies and Criticisms: Some critics argue that price supports distort market signals and can lead to overproduction and waste. Others argue that they disproportionately benefit large-scale farmers over small-scale farmers or other sectors of the economy.