LOCATION AND MARKETING UNDER MARKETING ASSISTANCE LOAN AND LOAN DEFICIENCY PAYMENT PROGRAMS

Marketing assistance loan (MAL) and loan deficiency payment (LDP) programs differ in their treatment of basis. This paper analyzes marketing decisions under these programs when producers are differentiated by location with respect to the terminal market. The developed model may help explain the observed lack of an association between the county loan rate and the share of a county's production enrolled in MAL programs. Under certain conditions, multiple equilibria are shown to emerge. The effects of MAL and LDP programs on welfare and policy implications are discussed.


Subject(s):
Issue Date:
2002
Publication Type:
Working or Discussion Paper
PURL Identifier:
http://purl.umn.edu/18464
Total Pages:
30
Series Statement:
CARD Working Paper 02-WP 297




 Record created 2017-04-01, last modified 2017-04-04

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