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The End of the Federal Tobacco Program: Economic Impacts of the Deregulation of U.S. Tobacco Production


  • A. Blake Brown
  • Randal R. Rucker
  • Walter N. Thurman


In 2004, Congress ended the sixty-six-year-old federal tobacco program, effectively deregulating production and prices. With deregulation came a buyout package, with cigarette manufacturers agreeing to pay more than $3 billion in present value to quota owners and farmers. While the dollar values of compensation payments are known, the effects of the historic legislation on tobacco markets are uncertain. We examine these effects and their welfare consequences. We also consider the appropriateness of the buyout payments under alternative views of economic damages due to the quota system's demise. Copyright 2007, Oxford University Press.

Suggested Citation

  • A. Blake Brown & Randal R. Rucker & Walter N. Thurman, 2007. "The End of the Federal Tobacco Program: Economic Impacts of the Deregulation of U.S. Tobacco Production," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 29(4), pages 635-655.
  • Handle: RePEc:oup:revage:v:29:y:2007:i:4:p:635-655

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    Cited by:

    1. Sullivan, Sarah & Glantz, Stanton, 2010. "The changing role of agriculture in tobacco control policymaking: A South Carolina case study," Social Science & Medicine, Elsevier, vol. 71(8), pages 1527-1534, October.
    2. Andrew Schmitz & Dwayne J. Haynes & Troy G. Schmitz, 2016. "Alternative Approaches to Compensation and Producer Rights," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 64(3), pages 439-454, September.

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