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Profit Maximization As A Management Goal On Southeastern Montana Ranches

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  • Biswas, Basudeb
  • Lacey, John R.
  • Workman, John P.
  • Siddoway, Francis H.

Abstract

While tests of producer rationality defined as conformity to the rules of profit maximization (or a similar postulate) for less developed countries are numerous, such tests for high-income countries are rare. This study investigates the extent of rationality observed in the production behavior of ranchers in southeastern Montana. The procedure used is that of Wise, Yotopoulos, and Nugent, based on a profit-maximizing production model. The data were collected by personal interviews for 69 ranchers. Results indicate that profit maximization is a reasonably good postulate for studying the behavior of ranchers, and that various policy measures, could, at least tentatively, proceed on that basis.

Suggested Citation

  • Biswas, Basudeb & Lacey, John R. & Workman, John P. & Siddoway, Francis H., 1984. "Profit Maximization As A Management Goal On Southeastern Montana Ranches," Western Journal of Agricultural Economics, Western Agricultural Economics Association, vol. 9(1), pages 1-9, July.
    • Handle: RePEc:ags:wjagec:32365
    DOI: 10.22004/ag.econ.32365
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    References listed on IDEAS

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    1. Simon, Herbert A, 1978. "Rationality as Process and as Product of Thought," American Economic Review, American Economic Association, vol. 68(2), pages 1-16, May.
    2. Schultz, Theodore W, 1980. "Nobel Lecture: The Economics of Being Poor," Journal of Political Economy, University of Chicago Press, vol. 88(4), pages 639-651, August.
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    4. Arthur H. Smith & William E. Martin, 1971. "Implications of Socioeconomic Goals and Attitudes of Cattle Ranchers on Rural Community Development in the West," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 53(5), pages 846-846.
    5. John Wise & Pan A. Yotopoulos, 1968. "A Test of the Hypothesis of Economic Rationality in a Less-developed Economy: An Abstract," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 50(2), pages 395-397.
    6. Paul R. Johnson, 1969. "On Testing Competing Hypotheses: Economic Rationality Versus Traditional Behavior: Reply," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 51(1), pages 208-209.
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    1. Sintori, Alexandra & Rozakis, Stelios & Tsiboukas, Kostas, 2009. "Multiple goals in farmers’ decision making: The case of sheep farming in Western Greece," 83rd Annual Conference, March 30 - April 1, 2009, Dublin, Ireland 51075, Agricultural Economics Society.
    2. Tanaka, John A. & Torell, L. Allen & Rimbey, Neil R., 2005. "Who Are Public Land Ranchers and Why Are They Out There?," Western Economics Forum, Western Agricultural Economics Association, vol. 4(2), pages 1-7.
    3. Bailey, DeeVon & Biswas, Basudeb & Kumbhakar, Subal C. & Schulthies, B. Kris, 1989. "An Analysis Of Technical, Allocative, And Scale Inefficiency: The Case Of Ecuadorian Dairy Farms," Western Journal of Agricultural Economics, Western Agricultural Economics Association, vol. 14(1), pages 1-8, July.
    4. Popp, Michael P. & Faminow, Merle D. & Parsch, Lucas D., 1998. "Adoption Of Backgrounding On Cow-Calf Farms," 1998 Annual meeting, August 2-5, Salt Lake City, UT 20800, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    5. Popp, Michael P. & Faminow, Merle D. & Parsch, Lucas D., 1999. "Factors Affecting The Adoption Of Value-Added Production On Cow-Calf Farms," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 31(1), pages 1-12, April.
    6. Stelios, Rozakis & Alexandra, Sintori & Konstantinos, Tsiboukas, 2009. "Utility-derived Supply Function of Sheep Milk: The Case of Etoloakarnania, Greece," 113th Seminar, September 3-6, 2009, Chania, Crete, Greece 58126, European Association of Agricultural Economists.

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