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A Bio-economic Dynamic Programming Analysis of the Seasonal Supply Response by Florida Dairy Producers

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  • Gao, X. M.
  • Spreen, Thomas H.
  • DeLorenzo, Michael A.

Abstract

Seasonal price premiums have been proposed as a means of dampening the highly seasonal patterns of milk production in Florida. A Markov decision bio-economic model of the breeding and replacement decisions was solved via stochastic dynamic programming and used to analyze the potential supply response to seasonal price premiums. The results of the analysis suggest that the seasonal milk supply in Florida is highly price inelastic.

Suggested Citation

  • Gao, X. M. & Spreen, Thomas H. & DeLorenzo, Michael A., 1992. "A Bio-economic Dynamic Programming Analysis of the Seasonal Supply Response by Florida Dairy Producers," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 24(2), pages 211-220, December.
    • Handle: RePEc:cup:jagaec:v:24:y:1992:i:02:p:211-220_01
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    1. Hall, Seth C. & Oltenacu, Pascal A. & Milligan, Robert A., 1987. "Returns to Dairy Producers Under Different Seasonal Production Patterns," Research Bulletins 183664, Cornell University, Department of Applied Economics and Management.
    2. Kaiser, Harry M. & Oltenacu, Pascal A. & Smith, Terry R., 1988. "The Effects Of Alternative Seasonal Price Differentials On Milk Production In New York," Northeastern Journal of Agricultural and Resource Economics, Northeastern Agricultural and Resource Economics Association, vol. 17(1), pages 1-10, April.
    3. Prindle, Allen M., 1980. "Evaluation Of The Base-Excess Plan For Leveling Seasonal Milk Production: Case Example Of Maryland," Northeastern Journal of Agricultural and Resource Economics, Northeastern Agricultural and Resource Economics Association, vol. 0(Number 1), pages 1-4, April.
    4. Prindle, Allen M., 1980. "Evaluation Of The Base-Excess Plan For Leveling Seasonal Milk Production: Case Example Of Maryland," Journal of the Northeastern Agricultural Economics Council, Northeastern Agricultural and Resource Economics Association, vol. 9(1), pages 1-4, April.
    5. Luh, Yir-Hueih & Stefanou, Spiro E., 1989. "Dairy Supply And Factor Demand Response To Output Price Risk: An Econometric Assessment," Northeastern Journal of Agricultural and Resource Economics, Northeastern Agricultural and Resource Economics Association, vol. 18(2), pages 1-6, October.
    6. Richard J. H. Caine & D. Peter Stonehouse, 1983. "Adjusting the Seasonality of Milk Shipments in Canada: Problems, Economic Impacts and Potential Policies," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 31(3), pages 331-350, November.
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    Cited by:

    1. Tozer, Peter R. & Huffaker, Ray G., 1998. "Dynamics Of Optimal Interactions Between Pasture Production And Milk Yields Of Australian Dairy Farms," 1998 Annual meeting, August 2-5, Salt Lake City, UT 20785, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    2. Nubern, Christopher A. & Kilmer, Richard L., 1995. "Alternative Fluid Milk Procurement Systems For Florida Dairy Farmers," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 27(2), pages 1-15, December.
    3. Tozer, Peter R. & Huffaker, Ray G., 1999. "Dairy Deregulation And Low-Input Dairy Production: A Bioeconomic Evaluation," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 24(1), pages 1-18, July.
    4. Nubern, Chris & Kilmer, Richard L., 1993. "Alternative Fluid Milk Procurement Systems for the Florida Dairy Farmers," Staff Paper Series 239301, University of Florida, Food and Resource Economics Department.

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