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The Impact of Quotas on the Optimal Adjustment of Milk Production at the Farm Level: A Comment

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  • Grant, K Gary

Abstract

In a recent article, Rasmussen and Nielsen (1985) conclude that a quota-induced reduction in milk production occurs through a decrease in feed per cow and, only if this is insufficient, is there a reduction in the number of cows. Here it is shown that, in their model, unless the capacity of the stalls is a binding constraint, any reduction in feed per cow is of second-order importance and solely the result of the indivisibility of the cow input. Moreover, the connections between farm-level decisions and the short-run, industry equilibria implied by their model are examined. Copyright 1989 by Oxford University Press.

Suggested Citation

  • Grant, K Gary, 1989. "The Impact of Quotas on the Optimal Adjustment of Milk Production at the Farm Level: A Comment," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 16(4), pages 515-522.
    • Handle: RePEc:oup:erevae:v:16:y:1989:i:4:p:515-22
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    Cited by:

    1. Joyce Willock & Ian J. Deary & Gareth Edwards‐Jones & Gavin J. Gibson & Murray J. McGregor & Alistair Sutherland & J. Barry Dent & Oliver Morgan & Robert Grieve, 1999. "The Role of Attitudes and Objectives in Farmer Decision Making: Business and Environmentally‐Oriented Behaviour in Scotland," Journal of Agricultural Economics, Wiley Blackwell, vol. 50(2), pages 286-303, May.

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