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Impacts of the Northeast Dairy Compact on New England Retail Prices

Published online by Cambridge University Press:  15 September 2016

Daniel A. Lass ,
Mawunyo Adanu  and
P. Geoffrey Allen
Daniel A. Lass
Affiliation:
Department of Resource Economics at the University of Massachusetts, Amherst
Mawunyo Adanu
Affiliation:
Department of Resource Economics at the University of Massachusetts, Amherst
P. Geoffrey Allen
Affiliation:
Department of Resource Economics at the University of Massachusetts, Amherst
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Abstract

Northeast Dairy Compact impacts were estimated for Boston and Hartford retail prices using an econometric model. Asymmetric speeds of adjustment to farm price increases and decreases were found; however, tests indicated that retail prices do return to the same level following equal farm price increases and decreases. Model forecasts suggested no structural changes occurred during the out-of-sample period, July 1996 through June 1998. Simulations with and without the Compact predicted lower retail fluid milk price impacts than actual July 1997 changes. These predicted impacts separate the effects of farm price changes on retail prices from possibly confounding effects.

Type
Impacts of the Northeast Dairy Compact
Information
Agricultural and Resource Economics Review , Volume 30 , Issue 1 , April 2001 , pp. 83 - 92
Copyright
Copyright © 2001 Northeastern Agricultural and Resource Economics Association 

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