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A prospect of moving towards free milk quota market in Ireland – will milk quota movement follow efficiency?

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  • Shrestha, Shailesh
  • Hennessy, Thia C.

Abstract

Quota trade in Ireland is ‘ring fenced’ to milk processors where farmers are not allowed to trade milk quota outside their designated milk processor. This ensures milk production staying within a region but has implications for the efficiency of milk production. In this paper, we simulated a free milk quota market in Ireland and compared the results with a milk quota exchange which was ring fenced to determine if the quota move from an inefficient region to a more efficient region. The results show that quota indeed follow efficiency of production when there is restriction over trade area.

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Bibliographic Info

Paper provided by European Association of Agricultural Economists in its series 2008 International Congress, August 26-29, 2008, Ghent, Belgium with number 43657.

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Date of creation: 2008
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Handle: RePEc:ags:eaae08:43657

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Keywords: Milk quota trade; Irish quota market; Farm level model; Agricultural and Food Policy;

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  1. Colman, David, 2000. "Inefficiencies in the UK milk quota system," Food Policy, Elsevier, vol. 25(1), pages 1-16, February.
  2. David Colman & Michael Burton & Dan Rigby & Jeremy Franks, 2002. "Structural Change and Policy Reform in the UK Dairy Sector," Journal of Agricultural Economics, Wiley Blackwell, vol. 53(3), pages 645-663.
  3. Alston, Julian M., 1981. "A Note on the Effects of Non-Transferable Quotas on Supply Functions," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 49(03), December.
  4. Boots, Maroeska & Oude Lansink, Alfons & Peerlings, Jack, 1997. "Efficiency Loss Due to Distortions in Dutch Milk Quota Trade," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 24(1), pages 31-46.
  5. Oskam, A. J. & Speijers, D. P., 1992. "Quota mobility and quota values : Influence on the structural development of dairy farming," Food Policy, Elsevier, vol. 17(1), pages 41-52, February.
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