By setting current legal definitions of parity in the context of history, this report traces how the parity price and parity income concepts developed. It identifies some of the consequences of price and income parity on agricultural resource use and efficiency, on the size and structure of the agricultural sector, and on the extent of producer discretion permitted by government intervention necessary to achieve such parity. How parity is being used in today's farm programs is highlighted. Earlier critiques of parity concepts are reviewed, and the case for changing the formulas is evaluated. Finally, alternative standards of equity to the parity price are offered. Cost of production, marginal social cost, and parity income are examined. Eighty-seven references and 12 data tables are included. (YLB)