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Industrialization and Contracting in U.S. Agriculture

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  • Ahearn, Mary Clare
  • Korb, Penelope J.
  • Banker, David E.
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    Abstract

    This paper examines the industrialization process of U.S. agriculture by examining the trends in the number of farms, the concentration of production during the last decade, and the dynamics of farm survivability, entry, and exit underlying aggregate statistics. We next examine vertical coordination as part of the industrialization process and highlight contracting in the poultry industry. The analysis provides evidence that production is continuing to be concentrated on a smaller number of farms at a relatively rapid rate, in spite of the stability in the number of farms. Although contracting clearly dominates the broiler industry, it is less prevalent in egg and turkey production, where other forms of vertical coordination are likely established.

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    Bibliographic Info

    Article provided by Southern Agricultural Economics Association in its journal Journal of Agricultural and Applied Economics.

    Volume (Year): 37 (2005)
    Issue (Month): 02 (August)
    Pages:

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    Handle: RePEc:ags:joaaec:43511

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    Web page: http://www.saea.org/jaae/jaae.htm
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    Related research

    Keywords: broilers; contracting; eggs; industrialization; poultry; structural change; turkeys; vertical integration; D23; D40; L11; L14 L22; L23; Q12;

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    References

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    1. Perry, Janet E. & Banker, David E. & Green, Robert C., 1999. "Broiler Farms' Organization, Management, and Performance," Agricultural Information Bulletins 33739, United States Department of Agriculture, Economic Research Service.
    2. Allen, Douglas W & Lueck, Dean, 1995. "Risk Preferences and the Economics of Contracts," American Economic Review, American Economic Association, vol. 85(2), pages 447-51, May.
    3. Michael Boehlje, 1999. "Structural Changes in the Agricultural Industries: How Do We Measure, Analyze and Understand Them?," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 81(5), pages 1028-1041.
    4. McBride, William D. & Key, Nigel D., 2003. "Economic And Structural Relationships In U.S. Hog Production," Agricultural Economics Reports 33971, United States Department of Agriculture, Economic Research Service.
    5. Azzeddine Azzam, 1998. "Captive Supplies, Market Conduct, and the Open-Market Price," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 80(1), pages 76-83.
    6. Johnson, James D. & Perry, Janet E. & Korb, Penelope J. & Sommer, Judith E. & Ryan, James T. & Green, Robert C. & Durst, Ron L. & Monke, James D., 2001. "Structural and Financial Characteristics of U.S. Farms: 2001 Family Farm Report," Agricultural Information Bulletins 33707, United States Department of Agriculture, Economic Research Service.
    7. Drabenstott, Mark, 1995. "Agricultural Industrialization: Implications For Economic Development And Public Policy," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 27(01), July.
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    Cited by:
    1. Katchova, Ani L., 2013. "Agricultural Contracting and Agrifood Competition," Staff Papers 164515, University of Kentucky, Department of Agricultural Economics.

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