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The Demand for Inputs and Technical Change in the U.S. Dairy Manufacturing Industry

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  • Zhang, Wei
  • Alston, Julian M.

Abstract

The dairy industry is of much interest worldwide because it has been subject to heavy government intervention. Central to the analysis of any dairy policy is a quantitative empirical understanding of the economic relationships in the industry. This paper models and measures the input demand relationships—especially, derived demand for farm milk as a processing input—and the rate and biases of technical change in the U.S. dairy manufacturing industry. Our estimates indicate that the Marshallian own-price elasticity of demand for farm milk is between −0.43 and −1.20. Estimates also indicate that technical change has been capital using and labor saving.

Suggested Citation

  • Zhang, Wei & Alston, Julian M., 2018. "The Demand for Inputs and Technical Change in the U.S. Dairy Manufacturing Industry," Agricultural and Resource Economics Review, Cambridge University Press, vol. 47(3), pages 533-567, December.
    • Handle: RePEc:cup:agrerw:v:47:y:2018:i:03:p:533-567_00
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    Cited by:

    1. Zhang, Wei, 2021. "California's Climate Policy and the Dairy Manufacturing Industry: How Does a Federal Milk Marketing Order Matter?," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 46(3), September.

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