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Diversification, Vertical Integration, and the Regional Pattern of Dairy Farm Size

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  • Daniel A. Summer
  • Christopher A. Wolf

Abstract

Dairy farm size differs considerably across the United States. We analyze patterns of dairy farm size to determine how differences in vertical integration and diversification relate to farm size. We find that diversification accounts for little size variation. For vertical integration, the partial correlation with dairy herd size is strongly negative. Dairy value-added size measures vary less across regions than herd size, indicating that an important part of herd size variation relates to vertical integration. Nonetheless, dairy farms in the Pacific and South regions remain much larger than farms in the traditional dairy regions, even when accounting for vertical integration. Copyright 2002, Oxford University Press.

Suggested Citation

  • Daniel A. Summer & Christopher A. Wolf, 2002. "Diversification, Vertical Integration, and the Regional Pattern of Dairy Farm Size," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 24(2), pages 442-457.
  • Handle: RePEc:oup:revage:v:24:y:2002:i:2:p:442-457
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    File URL: http://hdl.handle.net/10.1111/1467-9353.00030
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    Cited by:

    1. Traversac, Jean-Baptiste & Rousset, Sylvain & Perrier-Cornet, Philippe, 2011. "Farm resources, transaction costs and forward integration in agriculture: Evidence from French wine producers," Food Policy, Elsevier, vol. 36(6), pages 839-847.
    2. Herath, Deepananda P.B. & Weersink, Alfons & Thrikawala, Sunil, 2006. "Environmental Regulations and Livestock Production Levels: What is the Direction of Causality?," 2006 Annual meeting, July 23-26, Long Beach, CA 21482, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    3. Ani L. Katchova, 2005. "The Farm Diversification Discount," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 87(4), pages 984-994.
    4. Mukherjee, Deep & Bravo-Ureta, Boris E. & De Vries, Albert, 2013. "Dairy productivity and climatic conditions: econometric evidence from South-eastern united States," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 57(1), March.
    5. Wolf, Christopher A. & Tonsor, Glynn T., 2012. "Dairy Farmer Preferences for 2012 Farm Bill," 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington 124866, Agricultural and Applied Economics Association.
    6. Almuhanad Melhim & Erik J. O'Donoghue & C. Richard Shumway, 2009. "Do the Largest Firms Grow and Diversify the Fastest? The Case of U.S. Dairies," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 31(2), pages 284-302, June.
    7. Spielmann, Nathalie & Williams, Christopher, 2016. "It goes with the territory: Communal leverage as a marketing resource," Journal of Business Research, Elsevier, vol. 69(12), pages 5636-5643.
    8. Kang, Hye-Jung & Lee, Hyunok & Sumner, Daniel A., 2003. "Heterogeneity In Production Technology Across Farm Sizes: Analysis Of Multi-Output Production Function Using Korean Farm-Level Panel Data," 2003 Annual meeting, July 27-30, Montreal, Canada 22245, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    9. Mary Clare Ahearn & Penni Korb & Jet Yee, 2009. "Producer Dynamics in Agriculture: Empirical Evidence," NBER Chapters,in: Producer Dynamics: New Evidence from Micro Data, pages 369-391 National Bureau of Economic Research, Inc.

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