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Dairy Farm Size, Entry, and Exit in a Declining Production Region

Published online by Cambridge University Press:  28 April 2015

Noro C. Rahelizatovo  and
Jeffrey M. Gillespie
Noro C. Rahelizatovo
Affiliation:
Department of Agricultural Economics and Agribusiness, Louisiana State University Agricultural Center, Baton Rouge, Louisiana 70803
Jeffrey M. Gillespie
Affiliation:
Department of Agricultural Economics and Agribusiness, Louisiana State University Agricultural Center, Baton Rouge, Louisiana 70803
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Abstract

As with most agricultural industries, the U.S. dairy industry has evolved into a structure including fewer yet larger firms. In Louisiana, total milk production has declined along with dairy farm numbers since 1972. This study addresses the impact of alternative policies, macroeconomic factors, and technology on the structure of the Louisiana dairy industry using a micro-data non-stationary Markov chain analysis. Results indicate that a number of factors have affected the structure of the industry in Louisiana, including but not limited to prices, milk supply reduction programs, technology and interest rates.

Keywords

dairy farmsMarkov chain analysisseemingly unrelated regression
Type
Articles
Information
Journal of Agricultural and Applied Economics , Volume 31 , Issue 2 , August 1999 , pp. 333 - 347
Copyright
Copyright © Southern Agricultural Economics Association 1999

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