07-04 "Living High on the Hog: Factory Farms, Federal Policy, and the Structural Transformation of Swine Production"

U.S. farm policy reforms in 1996 produced significant overproduction of supported crops, with prices falling to levels that were often below average farm production costs. Among the beneficiaries of the policy shift were the largest corporate purchasers of supported crops, as they saw a steady supply of low-priced inputs. Industrial livestock firms were among the most significant buyers of U.S. corn and soybeans, the main components of livestock feed. Filling an important gap in the literature, this paper estimates the savings to industrial hog operations between 1997 and 2005 from feed components priced at levels below their production costs. The savings are found to be significant. We also find that industrial hog companies benefited from weak federal regulation of environmental pollution from livestock operations. We estimate the costs to industrial hog firms of compliance with new environmental regulations regarding mitigation of surface-water contamination from excess manure concentrations. This cost is also found to be significant. We assess the implications of these findings for the continued consolidation and industrialization of the industry. We find that mid-sized diversified farms that grow their own feed may well be able to compete on cost with large-scale industrial operations if the latter pay full cost for their feed and have to pay for just one part of their externalized pollution costs.

Does consultation improve decision making?

This paper reports an experiment designed to test whether prior consultation within a group affects subsequent individual decision making in tasks where demonstrability of correct solutions is low. In our experiment subjects considered two paintings created by two different artists and were asked to guess which artist made each painting. We observed answers given by individuals under two treatments: in one, subjects were allowed the opportunity to consult with other participants before making their private decisions; in the other there was no such opportunity. Our primary findings are that subjects in the first treatment evaluate the opportunity to consult positively but they perform significantly worse and earn significantly less.Consultation; Decision making; Group decisions; Individual decisions

06-03 "Feeding the Factory Farm: Implicit Subsidies to the Broiler Chicken Industry"

Since the passage of the 1996 Farm Bill, the U.S. market prices of soybeans and corn have dropped 21% and 32%, respectively. These commodities are now sold on the market at a price below what they cost to produce. If U.S. agricultural policies contribute to the prevalence of below-cost soybeans and corn, then the beneficiaries of such policies include the consumers of these products, particularly the industrial operations for which they are important raw materials. Most significant of these operations are corporate-owned livestock production facilities. This paper focuses on the broiler chicken industry, which, in the United States, is fully industrialized and vertically integrated. We compare average costs of production with market prices for corn and soybeans, then use these cost-price margins to estimate the implicit subsidies to broiler producers due to feed prices that are below production costs. We find that the broiler industry gained monetary benefits averaging $1.25 billion per year in the period following the passage of the 1996 Farm Bill (1997-2005). In contrast, broiler industry gains averaged a much smaller$377 million per year between 1986 and 1996. We conclude that the corporate broiler industry is a major winner from recent changes to U.S. agriculture policy, while family farmers and taxpayers lose out. This finding is not significantly altered when we adjust our calculations to account for the overvaluation of agricultural land, nor does it appear to reverse under future cost/price scenarios. As policymakers turn their attention to the 2007 Farm Bill, they would do well to examine the ways in which agribusiness firms in general, and industrial livestock operations in particular, benefit from policies ostensibly designed to support family farmers.

I Am Going Home

https://digitalcommons.library.umaine.edu/mmb-vp/4221/thumbnail.jp

If you\u27re such a Great Star, Why don\u27t you shine

https://digitalcommons.library.umaine.edu/mmb-vp/1831/thumbnail.jp

I\u27m Going To Take The Train For Home, Sweet Home

https://digitalcommons.library.umaine.edu/mmb-vp/1786/thumbnail.jp

How Can I Forget You : Dreaming Of You All The While

https://digitalcommons.library.umaine.edu/mmb-vp/1612/thumbnail.jp

Give Me A Night In June

https://digitalcommons.library.umaine.edu/mmb-vp/7387/thumbnail.jp

Empire State : Barn Dance

https://digitalcommons.library.umaine.edu/mmb-ps/2710/thumbnail.jp