A NOTE: A CLARIFICATION OF THE ROLE OF YIELD UNCERTAINTY IN INFLUENCING OVER-QUOTA PRODUCTION

The literature shows that the influence of yield uncertainty on production relative to quota is ambiguous in the case of a single market. This paper uses a two-market framework (quota market and secondary market) with multiplicative yield uncertainty to show that if over-quota production in the absence of yield uncertainty is profitable, then the presence of yield uncertainty is unambiguously a further stimulus to over-quota production. The analysis is discussed in the context of recent changes to the marketing arrangements for Western Australian potatoes.


Issue Date:
1995-08
Publication Type:
Journal Article
PURL Identifier:
http://purl.umn.edu/22402
Published in:
Australian Journal of Agricultural Economics, Volume 39, Number 2
Page range:
165-169
Total Pages:
5




 Record created 2017-04-01, last modified 2017-08-24

Fulltext:
Download fulltext
PDF

Rate this document:

Rate this document:
1
2
3
 
(Not yet reviewed)