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Packing facility management: Stochastic dominance analysis of cost allocation and revenue distribution rules

Author

Listed:
  • Constance L. Falk

    (Department of Agricultural Economics and Agricultural Business at New Mexico State University)

  • Daniel S. Tilley

    (Department of Agricultural Economics at Oklahoma State University)

Abstract

The impact of alternative cost allocation and revenue distribution rules in a multiproduct parking facility were modelled under conditions of stochastic prices and yields. Stochastic dominance with respect to a function was used to analyze the impacts on the riskiness of returns to growers. The returns of more risk averse growers with less diverse crop mixes were more sensitive to different combinations of rules. Cost allocation on the basis of hours of equipment operation and revenue distribution without pooling was the preferred alternative for fairly highly risk averse producers in seven of 10 classes of farms analyzed.

Suggested Citation

  • Constance L. Falk & Daniel S. Tilley, 1990. "Packing facility management: Stochastic dominance analysis of cost allocation and revenue distribution rules," Agribusiness, John Wiley & Sons, Ltd., vol. 6(4), pages 355-369.
    • Handle: RePEc:wly:agribz:v:6:y:1990:i:4:p:355-369
    DOI: 10.1002/1520-6297(199007)6:4<355::AID-AGR2720060407>3.0.CO;2-C
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    References listed on IDEAS

    as
    1. Steven T. Buccola & Abdelbagi Subaei, 1985. "Optimal Market Pools for Agricultural Cooperatives," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 67(1), pages 70-80.
    2. Runyan, Jack L. & Anthony, Joseph P., Jr. & Kesecker, Kevin M. & Ricker, Harold S. & Coale, Charles W., Jr. & O'Dell, Charles R, 1986. "Determining Commercial Marketing and Production Opportunities for Small Farm Vegetable Growers," Marketing Research Reports 313411, United States Department of Agriculture, Agricultural Marketing Service, Transportation and Marketing Program.
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