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The Adoption and Profitability of rbST on Connecticut Dairy Farms

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  • Jeremy D. Foltz
  • Hsiu-Hui Chang

Abstract

This work estimates Probit and Tobit models of the adoption of rbST on Connecticut dairy farms and then endogenizes that adoption in estimates of milk production and farm profit rates. The work improves on the current literature by allowing the rbST decision to be both continuous and contingent on other technology adoption decisions. The results show that larger farms, with more productivity technologies, and with younger, more educated farmers are more likely to adopt rbST. While rbST is shown to significantly increase milk production there is no evidence it increases profits on a per cow basis.

Suggested Citation

  • Jeremy D. Foltz & Hsiu-Hui Chang, 2001. "The Adoption and Profitability of rbST on Connecticut Dairy Farms," Food Marketing Policy Center Research Reports 055, University of Connecticut, Department of Agricultural and Resource Economics, Charles J. Zwick Center for Food and Resource Policy.
    • Handle: RePEc:zwi:fpcrep:055
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    File URL: http://fmpc.uconn.edu/publications/rr/rr55.pdf
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    References listed on IDEAS

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    1. Hardle, Wolfgang & Linton, Oliver, 1986. "Applied nonparametric methods," Handbook of Econometrics, in: R. F. Engle & D. McFadden (ed.), Handbook of Econometrics, edition 1, volume 4, chapter 38, pages 2295-2339, Elsevier.
    2. Saha Atanu & H. Alan Love & Robert Schwart, 1994. "Adoption of Emerging Technologies Under Output Uncertainty," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 76(4), pages 836-846.
    3. Zdenko Stefanides & Loren W. Tauer, 1999. "The Empirical Impact of Bovine Somatotropin on a Group of New York Dairy Farms," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 81(1), pages 95-102.
    4. Zepeda, Lydia, 1990. "Predicting Bovine Somatotropin Use By California Dairy Farmers," Western Journal of Agricultural Economics, Western Agricultural Economics Association, vol. 15(1), pages 1-8, July.
    5. Jeremy D. Foltz & Hsiu-Hui Chang, 2002. "The Adoption and Profitability of rbST on Connecticut Dairy Farms," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 84(4), pages 1021-1032.
    6. W. Lesser & John Bernard & Kaafee Billah, 1999. "Methodologies for ex ante projections of adoption rates for agbiotech products: Lessons learned from rBST," Agribusiness, John Wiley & Sons, Ltd., vol. 15(2), pages 149-162.
    7. Heckman, James J, 1990. "Varieties of Selection Bias," American Economic Review, American Economic Association, vol. 80(2), pages 313-318, May.
    8. Bruce A. Larson & Fred Kuchler, 1990. "The Simple Analytics of Technology Adoption: Bovine Growth Hormone and the Dairy Industry," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 12(1), pages 109-123.
    9. Bradford L. Barham, 1996. "Adoption of a Politicized Technology: bST and Wisconsin Dairy Farmers," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 78(4), pages 1056-1063.
    10. Hardle, Wolfgang & Linton, Oliver, 1986. "Applied nonparametric methods," Handbook of Econometrics, in: R. F. Engle & D. McFadden (ed.), Handbook of Econometrics, edition 1, volume 4, chapter 38, pages 2295-2339, Elsevier.
    11. C. Klotz & A. Sana & L.J. (Bees) Butler, 1995. "The Role of Information in Technology Adoption: The Case of rbST in the California Dairy Industry," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 17(3), pages 287-298.
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