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A Bio-economic Dynamic Programming Analysis of the Seasonal Supply Response by Florida Dairy Producers

Published online by Cambridge University Press:  28 April 2015

X. M. Gao ,
Thomas H. Spreen  and
Michael A. DeLorenzo
X. M. Gao
Affiliation:
Department of Agricultural Economics and Rural Sociology at theUniversity of Arkansas
Thomas H. Spreen
Affiliation:
Food and Resource Economics Department
Michael A. DeLorenzo
Affiliation:
Dairy Science Department at theUniversity of Florida
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Abstract

Seasonal price premiums have been proposed as a means of dampening the highly seasonal patterns of milk production in Florida. A Markov decision bio-economic model of the breeding and replacement decisions was solved via stochastic dynamic programming and used to analyze the potential supply response to seasonal price premiums. The results of the analysis suggest that the seasonal milk supply in Florida is highly price inelastic.

Keywords

dairy productionprice analysisbio-economic modelherd breeding and replacement
Type
Articles
Information
Journal of Agricultural and Applied Economics , Volume 24 , Issue 2 , December 1992 , pp. 211 - 220
Copyright
Copyright © Southern Agricultural Economics Association 1992

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