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Do Farmers Get An Equal Bang For Their Buck From Generic Advertising Programs? A Theroetical And Empirical Analysis

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  • Chung, Chanjin
  • Kaiser, Harry M.

Abstract

This study presents a theoretical and empirical analysis of the distribution of generic advertising benefits across individual producers. We develop a closed-economy partial equilibrium model that allows for the presence of producer heterogeneity in supply response. Analytical results indicate that producers having less elastic supply response capture more benefits per dollar expended than producers with more elastic supply response. The extent of unequal distribution depends on parameters characterizing industries. The inequality may not be a significant problem for some industries, especially where the firm-level supply elasticities are not substantially different among producers, but it may be an important issue when industries have substantial differences in firm-level supply elasticities and firm sizes, and experience large demand shifts due to advertising programs

Suggested Citation

  • Chung, Chanjin & Kaiser, Harry M., 2000. "Do Farmers Get An Equal Bang For Their Buck From Generic Advertising Programs? A Theroetical And Empirical Analysis," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 25(1), pages 1-12, July.
    • Handle: RePEc:ags:jlaare:30841
    DOI: 10.22004/ag.econ.30841
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    References listed on IDEAS

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    Cited by:

    1. Chanjin Chung & Harry M. Kaiser, 2003. "Distributional effects of commodity promotion programs by type of producer," Agribusiness, John Wiley & Sons, Ltd., vol. 19(3), pages 325-332.
    2. Zhang, Mingxia & Sexton, Richard J., 2000. "Optimal Commodity Promotion In Imperfectly Competitive Markets," 2000 Annual meeting, July 30-August 2, Tampa, FL 21823, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    3. Hunnicutt, Lynn & Israelsen, L. Dwight, 2003. "Incentives to Advertise and Product Differentiation," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 28(3), pages 1-14, December.
    4. Moore, Eli D. & Williams, Gary W., 2008. "Is the Texas Pecan Checkoff Program Working?," Reports 90497, Texas A&M University, Agribusiness, Food, and Consumer Economics Research Center.

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