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Endogenizing Government Behavior: Empirical Study Of The U.S. Dairy Price Support Program


  • Marchant, Mary A.
  • Song, Baohui


The dairy price support program has existed for more than 70 years and the 2002 Farm Bill extends the dairy price support program through the end of 2007. The choice of the support price is a political decision and affects the economics of the U.S. dairy industry. In this research, economic, political, domestic, and international variables that may influence U.S. policymakers' choice of the support price for manufactured dairy products (MDP--butter, cheese and nonfat dry milk) were identified through the development of two models--a behavioral model and a criterion function model. Empirical results of these two models ranked the importance of these variables and compared results.

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  • Marchant, Mary A. & Song, Baohui, 2003. "Endogenizing Government Behavior: Empirical Study Of The U.S. Dairy Price Support Program," 2003 Annual Meeting, February 1-5, 2003, Mobile, Alabama 35103, Southern Agricultural Economics Association.
  • Handle: RePEc:ags:saeatm:35103

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    References listed on IDEAS

    1. Jeffrey T. LaFrance & Harry de Gorter, 1985. "Regulation in a Dynamic Market: The U.S. Dairy Industry," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 67(4), pages 821-832.
    2. Rausser, Gordon C & Freebairn, John W, 1974. "Estimation of Policy Preference Functions: An Application to U.S. Beef Import Quotas," The Review of Economics and Statistics, MIT Press, vol. 56(4), pages 437-449, November.
    3. Marchant, Mary A. & Neff, Steven A. & Xiao, Mei, 1997. "Political Economy of United States and European Union Dairy Policy Choice," Occasional Paper Series No. 7 198045, International Association of Agricultural Economists.
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    Agricultural and Food Policy;


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