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Dairy Quota and Farm Structural Change: A Case Study on the Netherlands

  • Jongeneel, Roelof A.
  • Tonini, Axel

This paper sets out to analyse the impact of milk quotas had on the dairy farm structure of the Netherlands. In addition projections on the likely farm structure under different milk quota scenarios are explored. Moreover mobility indicators characterizing structural change are developed and calculated. A Markov probability model is estimated relying on a generalized cross entropy approach. The introduction of milk quotas as of April 1, 1984 froze the dairy farm structural adjustment, at least initially. However, later on mobility started to increase, which is likely to reflect the quota tradability and lease possibilities. Moreover there is evidence that the milk quota regime has increased concentration of dairy production among farms with 50-69 cows. If after quota abolition the dairy farm structural dynamics would be the same as in the 1972-83 period, then quota abolition in 2015 will lead to a substantial increase in the number of farms in 2022 as compared to the current status quo.

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File URL: http://purl.umn.edu/6692
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Paper provided by European Association of Agricultural Economists in its series 107th Seminar, January 30-February 1, 2008, Sevilla, Spain with number 6692.

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Date of creation: 2008
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Handle: RePEc:ags:eaa107:6692
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  1. Oskam, A. J. & Speijers, D. P., 1992. "Quota mobility and quota values : Influence on the structural development of dairy farming," Food Policy, Elsevier, vol. 17(1), pages 41-52, February.
  2. Shorrocks, A F, 1978. "The Measurement of Mobility," Econometrica, Econometric Society, vol. 46(5), pages 1013-24, September.
  3. Golan, Amos, 2002. "Information and Entropy Econometrics--Editor's View," Journal of Econometrics, Elsevier, vol. 107(1-2), pages 1-15, March.
  4. Golan, Amos & Judge, George G. & Miller, Douglas, 1996. "Maximum Entropy Econometrics," Staff General Research Papers 1488, Iowa State University, Department of Economics.
  5. Yusuf Jafry & Til Schuermann, 2003. "Metrics for Comparing Credit Migration Matrices," Center for Financial Institutions Working Papers 03-09, Wharton School Center for Financial Institutions, University of Pennsylvania.
  6. repec:cup:cbooks:9780521011143 is not listed on IDEAS
  7. Geweke, John & Marshall, Robert C & Zarkin, Gary A, 1986. "Mobility Indices in Continuous Time Markov Chains," Econometrica, Econometric Society, vol. 54(6), pages 1407-23, November.
  8. Axel Tonini & Roel Jongeneel, 2009. "The distribution of dairy farm size in Poland: a markov approach based on information theory," Applied Economics, Taylor & Francis Journals, vol. 41(1), pages 55-69.
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