Support Prices as Policy Tools in Dairy Industry: Issues in Theoretical Modeling
V. Premakumar, Sudhir Chaudhary
February 1996 [96-WP 151]
Premakumar, V. and S. Chaudhary. 1996. "Support Prices as Policy Tools in Dairy Industry: Issues in Theoretical Modeling." Working paper 96-WP 151. Center for Agricultural and Rural Development, Iowa State University.
A framework for modeling the dairy sector is developed, emphasizing the complexities unique to this multiproduct industry. Equilibrium conditions among competitive and joint dairy products are specified subject to mass balancing requirements, stable economic relationships, and appropriate policy parameters. The model is applied to Canada and incorporates the country-specific dairy policy mix.