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Commodity supply response to a producer-financed advertising program: The california avocado industry

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  • Hoy F. Carman

    (Department of Agricultural Economics, University of California, Davis)

  • Richard D. Green

    (Department of Agricultural Economics, University of California, Davis)

Abstract

A simulation model of the California avocado industry is used to estimate the impact of a producerfunded generic advertising program on acreage and returns over time. Although returns from advertising can be quite favorable in the short-run, improved returns stimulate increased plantings and the resulting production will erode advertising returns over time. California avocado producers, after over 30 years of actively promoting their product, appear to have real returns per acre similar to those that would have occurred without advertising but advertising has become a built-in cost. © 1993 John Wiley & Sons, Inc.

Suggested Citation

  • Hoy F. Carman & Richard D. Green, 1993. "Commodity supply response to a producer-financed advertising program: The california avocado industry," Agribusiness, John Wiley & Sons, Ltd., vol. 9(6), pages 605-621.
    • Handle: RePEc:wly:agribz:v:9:y:1993:i:6:p:605-621
    DOI: 10.1002/1520-6297(199311)9:6<605::AID-AGR2720090607>3.0.CO;2-4
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    References listed on IDEAS

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    1. Forker, Olan D. & Liu, Donald J., 1989. "Commodity Promotion: Who Benefits and By How Much?," Choices: The Magazine of Food, Farm, and Resource Issues, Agricultural and Applied Economics Association, vol. 4(3), pages 1-4.
    2. Hurst, Susan J. & Forker, Olan D., 1991. "Annotated Bibliography of Generic Commodity Promotion Research (Revised)," Research Bulletins 123107, Cornell University, Department of Applied Economics and Management.
    3. Marc Nerlove & Frederick V. Waugh, 1961. "Advertising without Supply Control: Some Implications of a Study of the Advertising of Oranges," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 43(4_Part_I), pages 813-837.
    4. Stanley R. Thompson & Doyle A. Eiler, 1975. "Producer Returns from Increased Milk Advertising," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 57(3), pages 505-508.
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    Cited by:

    1. Julian M. Alston & James A. Chalfant & Jennifer S. James, 1999. "Doing well by doing a body good: An evaluation of the industry-funded nutrition education program conducted by the Dairy Council of California," Agribusiness, John Wiley & Sons, Ltd., vol. 15(3), pages 371-392.
    2. Gary W. Williams, 1999. "Commodity checkoff programs as alternative producer investment opportunities: The case of soybeans," Agribusiness, John Wiley & Sons, Ltd., vol. 15(4), pages 539-552.
    3. Williams, Gary W. & Shumway, C. Richard & Love, H. Alan, 2002. "Returns to Soybean Producers from Investments in Promotion and Research," Agricultural and Resource Economics Review, Cambridge University Press, vol. 31(1), pages 97-111, April.
    4. Carman, Hoy F. & Li, Lan & Sexton, Richard J., 2009. "An Economic Evaluation of the Hass Avocado Promotion Order’s First Five Years," Research Reports 121697, University of California, Davis, Giannini Foundation.
    5. Williams, Gary W. & Capps Jr., Oral, 2020. "Generic promotion of Norwegian seafood exports," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 23(3), August.
    6. Hanawa, Hikaru & Willett, Lois Schertz & Tomek, William G., 1997. "An Econometric Analysis of the U.S. Kiwifruit Industry: Annual and Monthly Factors," Research Bulletins 122721, Cornell University, Department of Applied Economics and Management.
    7. Hoy F. Carman, 2006. "Offsetting Price Impacts from Imports with Generic Advertising and Promotion Programs: The Hass Avocado Promotion and Research Order," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 28(4), pages 463-481.
    8. Fritz, Richard & Cornelius, James & Green, John R., 1994. "An Assessment Of Product Marketing Strategies Utilized By The Oregon Potato Commission," Promotion in the Marketing Mix: What Works, Where and Why, April 28-29, 1994, Toronto, Canada 279594, Regional Research Projects > NECC-63: Research Committee on Commodity Promotion.

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