IDEAS home Printed from https://ideas.repec.org/p/ags/aaea04/20399.html
   My bibliography  Save this paper

Milk Marketing Orders And Milk Sanitation Regulation: Re-Evaulating Marketing Orders' Welfare Effects

Author

Listed:
  • Balagtas, Joseph Valdes
  • Sumner, Daniel A.

Abstract

This research shows that the existing literature on milk marketing orders misses an important effect. Previous work ignores the interaction of marketing orders with milk grading regulation. We model this interaction and show that producer benefits from marketing orders have been smaller than previous work suggests, and, under some conditions, may even be negative. Additional costs of producing fluid grade milk, omitted from previous welfare analyses, reduce producer benefits from marketing orders. Estimates of the additional cost indicate that this previously unmeasured effect is a significant component of the total welfare effect of marketing orders. An econometric model is developed to explain the variation in the fluid grade share of milk across states and time as a function of marketing order policy. Regression results support the hypothesis that marketing orders have encouraged the shift towards production of fluid-grade milk.

Suggested Citation

  • Balagtas, Joseph Valdes & Sumner, Daniel A., 2004. "Milk Marketing Orders And Milk Sanitation Regulation: Re-Evaulating Marketing Orders' Welfare Effects," 2004 Annual meeting, August 1-4, Denver, CO 20399, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
  • Handle: RePEc:ags:aaea04:20399
    as

    Download full text from publisher

    File URL: http://purl.umn.edu/20399
    Download Restriction: no

    References listed on IDEAS

    as
    1. Thomas L. Cox & Jean-Paul Chavas, 2001. "An Interregional Analysis of Price Discrimination and Domestic Policy Reform in the U.S. Dairy Sector," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 83(1), pages 89-106.
    2. R. M. Parish, 1962. "The Costs Of Protecting The Dairying Industry," The Economic Record, The Economic Society of Australia, vol. 38(82), pages 167-182, June.
    3. Kaiser, Harry M. & Morehart, Mitchell J., 1994. "A Regional Comparison Of Farm Costs And Returns Among Top Dairy Producers," Staff Papers 13647, University of Minnesota, Department of Applied Economics.
    4. Johnson, Stanley R. & Stonehouse, D. Peter & Hassan, Zuhair A., 1992. "Market Demand for Dairy Products," Staff General Research Papers Archive 575, Iowa State University, Department of Economics.
    5. Daniel A. Sumner & Christopher A. Wolf, 1996. "Quotas without Supply Control: Effects of Dairy Quota Policy in California," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 78(2), pages 354-366.
    6. Ippolito, Richard A & Masson, Robert T, 1978. "The Social Cost of Government Regulation of Milk," Journal of Law and Economics, University of Chicago Press, vol. 21(1), pages 33-65, April.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Marketing;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:aaea04:20399. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search). General contact details of provider: http://edirc.repec.org/data/aaeaaea.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.