Spatial and Temporal Marketing Considerations Under Marketing Loan Programs
AbstractMarketing assistance loan (MAL) and loan deficiency payment (LDP) programs differ in their treatment of transportation costs. Marketing decisions are analyzed under these programs when producers are differentiated by location with respect to the terminal market. Under certain conditions, a complete characterization of equilibrium is developed. The proposed model broadly fits several "stylized" facts about producer enrollment in these programs. If LDPs are uniform at all locations, LDP programs do not interfere with marketing decisions. MAL programs distort the optimal marketing pattern by providing incentives to store for producers who should be among the first ones to supply the market.
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Bibliographic InfoPaper provided by Iowa State University, Department of Economics in its series Staff General Research Papers with number 11884.
Date of creation: 01 Nov 2004
Date of revision:
Publication status: Published in American Journal of Agricultural Economics, November 2004, vol. 85, pp. 872-887
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Postal: Iowa State University, Dept. of Economics, 260 Heady Hall, Ames, IA 50011-1070
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Other versions of this item:
- Alexander E. Saak, 2003. "Spatial and Temporal Marketing Considerations under Marketing Loan Programs," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 85(4), pages 872-887.
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- Athey, Susan, 2002. "Monotone Comparative Statics Under Uncertainty," Scholarly Articles 3372263, Harvard University Department of Economics.
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