Printer Friendly

Consumer and welfare losses from milk marketing orders.

Consumer and Welfare Losses from Milk Marketing Orders

The regulation of the U.S. dairy industry has two major components. First, a Federal milk marketing order system exists that regulates the markets for Grade A fresh fluid milk. This system has been in effect since the passage of the Agricultural Adjustment Act of 1937. Second, there is a price support program under which the Commodity Credit Corporation (CCC) purchases butter, cheese, and nonfat dry milk at announced support prices, and the government stores and distributes stocks of these products. This program supports the price of Grade B milk, which m ay only be used for manufactured milk products, and surplus Grade A milk.

Under the Federal Milk marketing order system, Grade A milk is priced according to its use and a higher price is charged for milk used for fluid consumption than for milk used for manufactured milk products. Individual prices are set for various regions of the United States. The regulations that set prices for specific regions are called milk marketing orders. They establish minimum prices for 80 percent of the Grade A milk sold in the United States and also establish the methods by which farmers are reimbursed for Grade A milk. Farmers receive a "blend price," which is a weighted average of prices paid for different classes of milk in their region.

The milk marketing system is further restricted by policies for reconstituted milk. Although the technology for reconstituting milk has been available since the 1953s, reconstituted milk is used in only a few areas because of USDA policies that make it more expensive than fresh milk.

The purpose of this study is to measure the consumer and welfare losses from milk marketing orders in 1985. Losses are based on potential changes in prices and quantities when milk marketing orders are eliminated and replaced by a competitive system. There are no changes in the dairy price support program. In addition, consideration is given to the impact of marketing orders on the sale of reconstituted milk and the effects of existing reconstituted milk policies on consumers. The results of this study should be of interest to consumer educators and consumer policy analysts who are concerned with the impact of regulations on consumers and the economy as a whole.

BACKGROUND: MILK MARKETING ORDERS

A Federal milk order is a regulation promulgated by the Secretary of Agriculture, published in the Federal Register and codified in the Code of Regulations. It defines a particular geographic region that is subject to government regulation (MacAvoy 1977, p. 2).

Milk marketing orders apply only to Grade A milk. Grade A milk is milk that meets local sanitary and health requirements so that it may be used for fluid consumption. Ungraded or Grade B milk is milk that is not subject to local health regulations and can only be used in the production of manufactured milk products. Grade A milk that is produced in excess of fluid milk requirements can also be used in the production of manufactured milk products. Approximately 85 percent of all milk produced is Grade A and of this only 45 percent is used for fresh fluid milk products. The remainder is diverted into manufactured uses (USDA 1984, p. 24).

In markets where producers (farmers) have chosen to be covered by Federal orders, milk marketing orders establish the minimum prices that handlers must pay for raw Grade A milk and the prices that are received by the producers of milk. Milk handlers pay classified prices that are determined by use (class) to which the handler ultimately puts the milk. Milk marketing orders may have two or three classes of milk established. Class 1 milk products include fluid forms such as fresh whole milk, skim milk, and buttermilk. Class 2 products include soft manufactured products such as sour cream and cottage cheese. CLass 3 products are more solid manufactured products such as cheese, butter, and milk powders.

Grade A dairy farmers are not reimbursed at the classified (market order) prices. Farmers receive a single weighted average called a blend price. All of the income received in an order is "pooled," and all farmers received the same unit price for deliveries. Thus, if 60 percent of the total milk sold by the cooperative is used for Class 1 purposes and 40 percent is used for Class 2 purposes, each farmer would receive a unit price equivalent to 60 percent of the Class 1 price and 40 percent of the Class 2 price. This would occur even if the particular farmer's milk was used only in the production of Class 2 products.

The impact of classified prices for milk in the United States is significant. In 1985, the year of this study, there were 45 Federal milk marketing orders in existence. Almost three-quarters of the United States population resided in these order areas. Seventy percent of all milk marketed in the United States and 80 percent of all Grade A milk marketed in the United STates was marketed in Federal order areas (USDA 1986, p. 11).

In view of the longevity of milk marketing orders, it is not surprising that there have been a considerable number of studies on their economic consequences (Dahlgran 1980; Dobson and Buxton 1977; Hammond, Buxton, and Thraen 1979; Heien 1977; Ippolito and Masson 1978; LaFrance and de Gorter 1985; Song and Hallberg 1982). These and other studies were reviewed ba a Task Force of the American Agricultural Economics Association in 1986. The report noted that most studies used either "spatial equilibrium modeling" or a "model of discriminatory pricing from the industrial organization literature" (American Agricultural Economics Association 1986, pp. 13-14). In general, marketing orders resulted in higher producer prices than could be obtained without regulation, while there was disagreement and uncertainty concerning the effects of orders on price stability.

CONSUMER AND WELFARE LOSSES FROM MILK MARKETING ORDERS

The welfare loss model used in this study is based on the price discrimination model that has been used in other studies, It differs from most other studies in its estimation of the relative welfare loss as well as the absolute welfare loss. In addition, consideration is given to the regressive effects of milk marketing orders on consumers due to price descrimination.

Welfare Loss Model

Data for Class 2 and Class 3 milk were combined in this analysis for purposes of simplification. Class 1 milk is fluid milk, while Class 2 milk is milk used in all manufactured milk products. The welfare loss model is shown in Figure 1. Prices and quantities are given to the verti cal and horizontal axes respectively. The demand curves for Class 1 and Class 2 milk are given in Figures 1A and 1B. When the two demand curves [D.sub.1][D.sub.1] and [D.sub.2][D.sub.2] are added horizontally, the result is DD, the aggregate demand curve shown in Figure 1C. This demand curve reflects the use of Grade A milk for both fluid and manufacturing purposes. The supply of all Grade A milk is given by SS.

In a competitive market all Grade A milk would sell for one price regardless of its use. This single competitive price is determined by the intersection of the aggregate demand (DD) and supply curves (SS), identified as point K in Figure 1C. The price, '*', represents the price of Grade A milk that would exist in a competitive market, and [Q.sub.s] represents the total quantity that would be sold in a competitive market. It is equal to '*' and '*', which are the competitive quantities in the Class 1 and Class 2 markets, respectively.

Under milk marketing orders, the price of Class 1 milk [P.sub.1] i

Under milk marketing orders, the price of Class 1 milk ([P.sub.1]) is set higher than the price of Class 2 milk ([P.sub.2]). In Figure 1A, [P.sub.1], the price of Class 1 milk under milk marketing orders, results in the quantity [Q.sub.1] being demanded. Similarly, in Figure 1B, [P.sub.2], the price for Class 2 milk, results in a quantity [Q.sub.2] being demanded.

The blend price, [P.sub.b], is the price received by farmers and is calculated as follows: [P.sub.b] = [[P.sub.1][Q.sub.1] + [P.sub.2]([Q.sub.s] - [Q.sub.1])]/[Q.sub.s].

This formula means that all milk not consumed as Class 1 is assigned to Class 2. Note that [Q.sub.1] and [Q.sub.2] need not equal [Q.sub.s], because [P.sub.1] and [P.sub.2] are set by the USDA and are not necessarily market clearing prices.

As shown in the Figure, the single competitive price '*' is higher than [P.sub.2], but lower than [P.sub.1] and [P.sub.b]. This relationship is based on the results of existing studies and is confirmed by the results of this study. Finally, the price '*' is given by the intersection of the aggregate demand curve and the line H[Q.sub.s]. This price is important because it is used in the estimation of the efficiency loss. It represents the value to consumers of the last unit of Grade A milk produced by farmers under milk marketing orders.

The welfare loss is based on changes in consumer and producer surpluses and the efficiency loss under milk marketing orders.(1) In Figure 1A the price increase from '*' to [P.sub.1] results in a loss in consumer surplus equal to '*'[P.sub.1]AB (area a). In contrast, there is a gain in consumer surplus in the Class 2 market due to a price decrease from '*' to [P.sub.2]. This gain is equal to '*'[P.sub.2]FE (area b). The net loss in consumer surplus is obtained by deducting the gain in Class 2 market from the loss in Class 1 market.

There is also a gain in producer surplus, or quasi-rent, when the competitive '*' is replaced by the blend price [P.sub.b]. It is equal to '*'[P.sub.b]HK (area c). The final component is the efficiency loss, which is given by HKJ (area d). It reflects the production of [Q.sub.s] - ['*'.sub.s] units under milk marketing oeder as milk producers respond to the blend price. The willingness to pay for this additional quantity is given by ['*'.sub.s]KJ[Q.sub.s], while the additional costs are given by ['*'.sub.s]KH[Q.sub.s]. The difference between these two components is the efficiency loss.

The absolute welfare loss is equal to the areas a+d minus the areas b+c. It is also possible to estimate the relative welfare loss given by the absolute welfare loss divided by the change in producer surplus. In this manner the net transfer costs of aiding dairy farmers may be assessed. Thus, a relative welfare loss of 0.60 indicates that each $100 transferred to producers through milk marketing orders costs the economy $160 ($100 in transfer payments and $60 in transfer costs).

Estimation of Prices and Quantities Used in the Analysis

Equilibrium prices and quantities were based on actual prices and quantities under milk marketing orders and price elasticities of demand and supply.

The formula for the price elasticity of demand for Class 1 milk is:

N = ('*'Q/[Q.sub.1])('*'P/[P.sub.1) =

('*'Q/'*'P)/([P.sub.1]/[Q.sub.1])

where

[N.sub.1] = price elasticity of demand for class 1 milk at point A (Figure 1A), [P.sub.1] = price of Class 1 milk at point A, and [Q.sub.1] = quantity of Class 1 milk at point A.

This formula may be rewritten as follows:

[N.sub.1] = [([q.sub.1] - ['*'.sub.2])/([P.sub.2] - '*')] [[P.sub.2]/[Q.sub.2]]

Similarly, the Class 2 formula is given by:

[Mathematical Expression Omitted]

where

[N.sub.2] = price elasticity of demand at point F (Figure 1 B). [P.sub.2] = price of Class 2 milk at point F, and [Q.sub.2] = quantity of Class 2 milk at point F.

The supply elasticity formula can be expressed as:

[E.sub.s] = [([Q.sub.s] - ['*'.sub.s])/([P.sub.b] - '*')] [[P.sub.b]/[Q.sub.s]]

where [E.sub.s] is the price elasticity of supply at point H (Figure 1C), and the other terms are as defined earlier. In addition, the quantities of Class 1 and Class 2 milk demanded would equal the quantity supplied. This equilibrium situation can be stated as:

['*'.sub.1] + ['*'.sub.2] = ['*'.sub.s].

Equations 2, 3, 4, and 5 can then be solved for the four unknowns '*', ['*'.sub.1], ['*'.sub.2], and ['*'.sub.s].

The analysis was done using 1985 data. Prices and quantities of milk demanded and supplied during 1985 were collected from the USDA (1986; 1987). A summary of prices and quantities is given in Table 1. There is excess production of 13.2 billion pounds.

Several authors have studied demand elasticities for fluid and manufactured milk products (Dobson and Buxton 1977; Hammond, Buxton, and Thraen 1979; Dahlgran 1980; Dahlgran 1981). Based on these studies, two sets of demand elasticities were used: [N.sub.1] = - .18;[N.sub.2] = - .35 and [N.sub.1] = -.35;[N.sub.2] = - .65.

Values of two and three were used for the elasticities of supply based on research by Dahlgran (1980) and the ability of Grade B milk producers to switch to Grade A production at minimal cost (American Agricultural Economics Association 1986).

The competitive prices and quantities under different sets of demand and supply elasticities are also given in Table 1. competitive prices range from $12.56 to $12.84 and are lower than the Class 1 price ($14.67) and higher than the Class 2 price ($12.44), as expected. Competitive prices are also lower than the blend price of $13.40 received by milk producers under milk marketing orders. This result is in keeping with the findings of other studies that milk marketing orders have increased average producer milk prices, although such increases have been less than ten percent (American Agricultural Economics Association 1986).

The price *, which was needed to estimate the efficiency loss, was obtained by first deriving a point on the aggregate demand curve corresponding to the price [P.sub.2]. Assuming linear demand curves, similar triangles could then be used to obtain the price * because data were available for *, *, and [Q.sub.s] (Figure 1c).

The gains and Losses from Milk Marketing Orders

The net loss in consumer surplus from milk marketing orders is given in Table 2. Losses in Class 1 markets are far higher than gains in Class 2 markets, resulting in a net loss in consumer surplus. This loss ranges from $621 million to $851 million depending on demand and supply conditions. The price elasticity of supply has the greatest impact, reflecting a lower competitive price under more inelastic supply conditions.

The gains and losses from milk marketing orders are given in Table 3. The gain in producer surplus is also affected by the price elasticity of supply ranging from $726 million to $770 million for an elasticity of supply equal to two and from $512 million to $530 million for an elasticity of supply equal to three. The price elasticities of demand have a greater impact on the efficiency loss than the price elasticity of supply. The efficiency loss increases by more than 90 percent when the price elasticities of demand become more inelastic.

The absolute welfare loss was obtained by deducting the gain in producer surplus from the net loss in consumer surplus and the efficiency loss. It ranges from $343 million to $608 million with the price elasticities of demand again having the greatest impact. The most interesting result shown in Table 3 pertains to the relative welfare loss, which is given in the last column. It ranges from 0.472 to 1.147, with the highest values occurring under the most elastic supply conditions and the most inelastic demand conditions. This mean that it costs the economy from $147 to $215 to increase the income of dairy farmers by $100. The excess over $100 reflects the inefficiencies or leaks that occur with this type of income assistance prorgram. (2)

Finally, the regressive effects of milk marketing orders on consumers were investigated using the methods developed by Hickok (1985). The percentage increase in price for Class 1 milk and the percentage decrease in price for Class 2 milk were first estimated. These changes were then multiplied by annual expenditures on fluid milk and manufactured milk products for each income group to determine the net costs of milk marketing orders on consumers. The net costs were then divided by the midpoint of each income group. The "income tax" surcharge was ascertained by dividing the percentage of income that the net costs represented by the Federal income tax rate. The results are given in Table 4 for an elasticity of supply equal to two. The surcharge ranges from 0.1 percent for the highest income group to 14.4 percent for the lowest income group that paid Federal income tax. Similar results were obtained for an elasticity of supply equal to three. These results indicate the agressive effects of milk marketing orders and reflect the fact that Class 2 milk consumers are being subsidized by Class 1 milk consumers under milk marketing orders.

RECONSTITUTED MILK

Elimination of milk marketing orders is one method for avoiding the welfare losses discussed in the preceding section. However, such losses could also be reduced or eliminated if existing policies for reconstituted milk were changed. The consequences of existing reconstituted milk policies and proposals for change are discussed in the following section.

The U.S. Public Health Service defines reconstituted or recombined milk as "...milk products...which result from the recombining of milk constituents with potable water" (Hammond, Buxton, and Thraen 1979, p. 5). The process of recombining involves mixing water and nonfat dry milk at certain temperatures and then adding the desired amount of milk fat (Hammond, Buxton, and Thraen 1979, p. 3). Blended milk is a mixture of reconstituted milk and fresh milk (Novakovic and Aplin 1982, p. 1). The technology for reconstituting milk has been available since the 1950s.

Reconstituted milk is not prohibited from sale. However, the "down allocation" and "compensatory payment" provisions of milk marketing orders effectively prohibit the sale of reconstituted milk. Under milk marketing orders, minimum Grade A milk prices are set according to how the milk is used (i.e., for fluid or manufactured milk products). "Down allocations" require that reconstituted milk be assigned to the lowest use class (Class 2 in this study) of a processor, regardless of the class for which it is actually used. Allocation provisions of the USDA require that all local fresh milk is first assigned to Class 1 uses. Any remaining local milk, as well as imported and reconstituted milk, is then assigned to manufacturing uses (Whipple 1983, p. 207). The compesatory payment provision requires that a processor who uses reconstituted milk excess of his lowest class production (e.g., Class 2 production) is charged a compensatory payment equal to the Class 1 differential on the excess (Novakovic 1982, p. 19).

Although these policies are intended to make the cost of reconstituted milk the same as fresh milk to the processor, the effect is to make reconstituted milk more expensive than fresh milk because there are additional costs involved for dehydration, reconstitution, and storage of reconstituted milk.

In August 1979, a consumer interest group called the Community Nutrition Institute (CNI) made a proposal to the USDA that reconstituted milk products be eliminated from the (down allocation" and "compensatory payment" provisions of milk marketing orders. The effect of this proposal would been to reclassify all reconstituted milk in the lowest use class applicable to a region (i.e., Class 2 or 3). The cost of reconstituted milk would then have been the manufacturing price plus the costs of concentration and reconstitution.

The CNI proposal was based on the arguments that existing reconstituted milk provisions:

(1) eliminated an equally nutritious, lower-cost substitute for fresh milk,

(2) were unnecessary to protect milk producers in today's market conditions,

(3) were contrary to other policies in the Agricultural Adjustment Act that protected against unreasonable fluctuations in prices and supplies,

(4) created barriers to selling nonfat dry milk, and

(5) exceeded USDA's authority to regulate prices of milk substitutes (Federal Register 1980).

The CNI proposal was rejected by the Secretary of Agriculture for a number of reasons. The first reason was that the proposal was inconsistent with the intent of the Agricultural Marketing Adjustment Act of 1937 because it would lead to competition that would result in market instability. While many of the studies on reconstituted milk agree that instability would result in the short run if the CNI proposal were instituted, it was pointed out that prospects for long-term stability were enhanced due to the transportability and storability of dried milk (Whipple 1983, p. 213). Reclassifying reconstituted milk would allow excess milk produced during peak supply periods to be stored and used during peak demand periods. Additionally, reconstituted milk could be transported from efficient milk producing regions to less efficient regions.

The second and third reasons were related. it was argued that increased competition resulting from lower reconstituted milk prices would lead to pressures to lower Class 1 prices that would decrease returns to producers. Further price supports for manufactured milk products would then be necessary to offset declines in producer income. As a result the net benefits to consumers would be negligible. In rebuttal it was pointed out that the effects of a new reconstituted milk policy would vary geographically, with producers gaining in the upper and central Midwest at the expense of producers in the Northeast and South. It might also be queried why milk producers in some regions of the country should be protected from the adverse consequences of a new technology and why the costs of such protection should be borne by fluid milk consumers rather than by society as a whole.

The final reason given by the USDA was the consumers could buy nonfat dry milk and blend it with fresh milk at home. This argument centers on the acceptability of home prepared reconstituted milk versus commercially reconstituted milk. Few people use dried milk at home because the taste is not sufficiently close to that of fresh milk. Commercially of fresh milk because of the temperature at which it is mixed ("A Reconstituted milk has a taste that is closer to the taste.

Based on the above arguments, the proposed changes in reconstituted milk policies appear to be incompatible with milk marketing orders and would have many of the same effects as eliminating these orders. Thus, the failure to use reconstituted milk to satisty fluid milk requirements due to existing policies entails similar losses to those obtained earlier under milk marketing orders. In addition, the benefits of reconstituted milk (avoidance of demand/supply imbalances and concentration of production in efficient milk-producing regions) are lost.

DISCUSSION

The Agricultural Adjustment Act of 1937, which instituted milk marketing orders, was an attempt to ameliorate the conditions that existed in the dairy industry during the 1920s and 1930s. The objectives of this act were to ensure adequate supplies of milk from the depressed farming industry and to protect farmers from the monopsonistic power of milk handlers.

The purpose of this study was to measure the consumer and welfare losses from milk marketing orders in 1985. The losses from milk marketing orders were estimated by first determining the prices and quantities that would prevail under a competitive system.

The net loss in consumer surplus ranged from $621 million to $851 million, with Class 2 milk consumers gaining at the expense of Class 1 milk consumers. As a result the effect of milk marketing orders on consumers was regressive. The absolute welfare loss ranged from $343 million to $608 million, which is in agreement with the results of other studies of milk marketing orders (Dahlgran 1980; Ippolito and Masson 1978). The most recent study by LaFrance and De Gorter (1985) obtained costs ranging from $561 million to $770 million, which are higher than these estimates. However, their study also included the costs of the dairy price support program. The relative welfare loss, which had not been estimated in other studies, ranged from 0.47 to 1.15. This means that the current system of producer protections costs from $147 to $215 for every $100 transferred to dairy farmers. These are relatively high transfer costs.

In veiw of these findings it might be queried why milk marketing orders continue to exist in the United States. One of the reasons for their continued existence may be historical. In the early years of milk marketing, there was a need for policies that ensured local suppliers of milk because milk could neither be transported over long distances nor stored for long periods. Dairy farmers had to be insulated from outside competition to protect local production capabilities. Milk marketing orders were designed to provide this insulation. However, there are significant contrasts between the situation in the post-Depression milk industry and the industry today. Due to improved transportation facilities, information, and communication capabilities, milk markets needs no longer be local. Thus, it is no longer appropriate to require that local consumption be satisfied strictly from local supplies.

The ability to reconstitute milk has reduced even further the dependence on local milk supplies. the fact that supply and price fluctuations may be evened out means that milk marketing orders are no longer needed to ensure price stability (Lenard and Mazur 1985). It is ironic that a technology that could ensure adequate and low-cost supplies of milk throughout the year is rejected because of its impact on a milk marketing order system that is no longer needed. These developments indicate the need to inform consumers and consumer organizations about the adverse effects of producer-oriented policies and the need to protest policies that are obsolete, inefficient, and inequitable.

(1) The compensating variation in income is a valid measure of consumer gains and losses from price changes (Hicks 1956). If the amount effect of a price change is negligible, the change in consumer surplus is equal to the compensating variation.

(2) Relative welfare loss ranged from 0.61 to 1.58 in the case of trade restrictions for sugar (Dardis and Young 1985). Okun, in his discussion of the leaky bucket experiment, indicated that he would accept a maximum leakage of 60 percent or a relative welfare loss of 1.50 ($60/40) in the case of income transfers from the very rich to the very poor. In other intances, leakages of 15 percent would be more appropriate (Okun 1975, pp. 94-95). This represents a relative welfare loss of 0.18, which is considerably lower than those found in this study.

REFERENCES

"A Reconstituted Threat to the Milk Cartel" (1983), Regulation, 7 (May/June): 5-7.

American Agricultural Economics Association (AAEA) (1986), Task Force on Dairy Marketing Orders, federal Milk Marketing Orders: A Review of Research on Their Economic Consequences, Occasional Paper No. 3, (June).

Dahlgran, roger A. (1981), "Dairy Marketing and Policy Analysis: A Critical Review of Recent Empirical Studies," Economic Special Report No. 62, Department of Economics and Business, North Carolina State University.

Dahlgran, Roger A. (1980), "Welfare Costs and Interregional Income Transfers Due to Regulation of Dairy Markets," American Journal of Agricultural Economics, 62 (May): 288-296.

Dardis, R. and C. Young (1985), "The Welfare Loss from the New Sugar Programs," Journal of Consumer Affairs, 19 (Summer): 163-176.

Dobson, W.D. and Boyd M. Buxton (1977), "Analysis of the Effects of federal Milk Orders on the Ecnomic Performance of U.S. Milk Markets," Wisconsin Agricultural Experiment Station research Bulletin R2897, University of Wisconsin, (October).

Federal Register (1980), "Handling in federal milk marketing areas: Request for Public Comments on Preliminary Impact Statement on Proposed Amendments to Tentative Marketing Agreements and Orders, 45 (November 17): 75956-75994.

Hammond, J. W., Boyd M. Buxton and Cameron S. Thraen (1979), "Potential Impacts of Reconstituted Milk on Regional Prices, Utilization and Production," Agricultural Experimental Station Bulletin No. 529, University of Minnesota.

Heien, D. (1977), "The Costs of the U.S. Dairy Price Support Program: 1949-1974," Review of Economics and Statistics, 59 (February): 1-8.

Hickok, Susan (1985), "The Consumer Cost of U.S. Trad Constraints," Federal Reserve Bank of New York-Quarterly Review, 10 (Summer):1-12.

Hicks, J. R. (1956), A Revision of Demand Theory, Oxford: Clarendon Press.

Ippolito, Richard A. and Robert T. Masson (1978), "The Social Cost of Government Regulation of Milk," Journal of Law and Economics, 21 (April): 33-65.

LaFrance, J. R. and H. de Gorter (1985), "Regulation in a Dynamic Market: The U.S. Dairy Industry," American Journal of Agricultural Economics, 67 (November): 821-832.

Lenard, Thomas M. and Michael Mazur (1985), "Harvest of waste--The Marketing Order Program," Regulation, 9 (May/June): 19-26.

MacAvoy, Paul W. (ed.) (1977), Federal Milk Marketing Orders and Price Supports, Washington, DC: American Enterprise Institute for Public Policy Research.

Novakovic, Andrew (1982), "A Further Analysis of the Comparative cost of Reconstituting Beverage Milk Products," AER 82-32, Cornell University, (October).

Novakovic, Andrew and Richard Aplin (1982), "An Analysis of the Impact of Deregulating the Pricing of Reconstituted Milk Under Federal Milk Marketing Orders," Cornell Agricultural Economics Staff Paper No. 82-6, Cornell University, (March).

Okun, A. M. (1975), equality and Efficiency: The Big Trade-Off, Washington, DC: The Brookings Institution.

Song, D. H. and M. C. Hallberg (1982), "Measuring Producers' Advantage from Classified Pricing of Milk,c American Journal of Agricultural economics, 64 (February): 1-7.

U.S. Department of Agriculture (USDA) (1984), Dairy Background for 1985 Farm Legislation, Agriculture Information Bulletin No. 474, Washington, DC.

U.S. Department of Agriculture (USDAe (1986), Federal Milk Order Market Statistics: 1985 Annual Summary, Stastical Belletin No. 745, Washington, DC

U.S. Department of agriculture (USDA) (USDA) (1987), Dairy-Situation and and Outlook Report, Economic Research Serivice. DS-409, Washington, DC (April).

Whipple, Glen D. (1983), "An Analysis of Reconstituted Fluid milk Pricing Policy," American Journal of Agricultural Economcs, 65 (May): 204-213.

Rachel Dardis is a Professor in the Department of Textiles and Consumer economics at the University of Maryland, College Park, MD, and Bonnie Bedore is a Budget Analyst for the Department of the Navy.
COPYRIGHT 1990 American Council on Consumer Interests
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1990 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Author:Dardis, Rachel; Bedore, Bonnie
Publication:Journal of Consumer Affairs
Date:Dec 22, 1990
Words:5062
Previous Article:An ordered-response income adequacy model.
Next Article:Cost and quality factors in parents' choice of after-school child care.
Topics:


Related Articles
Pennsylvania Farm Bureau Requests Milk Hearing
Are apparel trade restrictions regressive?
Bowland Fresh Milk for Northern Booths stores. (Products & Packs).
World Bank says dairy trade a "quagmire of distortions".
Campina Invests 10 Million Euros in Cologne Branch.
Milk powder prices set to decline.
Milk prices most expensive in EU.
Dairy groups demand a higher price for milk.
Milk prices drop after calls to tackle high prices.

Terms of use | Copyright © 2016 Farlex, Inc. | Feedback | For webmasters