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Effects of marketing order prorate suspensions on California—Arizona navel oranges
Author(s) -
Powers Nicholas J.
Publication year - 1991
Publication title -
agribusiness
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.57
H-Index - 43
eISSN - 1520-6297
pISSN - 0742-4477
DOI - 10.1002/1520-6297(199105)7:3<203::aid-agr2720070304>3.0.co;2-3
Subject(s) - navel orange , navel , order (exchange) , economics , horticulture , biology , finance , anatomy
An econometric analysis shows that the late‐season suspensions of handler prorates in the Federal marketing order for California—Arizona navel oranges during the 1983 to 1989 seasons increased quantities used fresh and lowered prices for fresh navels. The suspensions also decreased quantities processed which increased prices for processing navels. Because demand is more price inelastic in the higher‐priced, fresh‐use market than for processing, growers' revenue fell during the suspensions. The suspensions boosted total marketers' and consumers' economic well‐being as measured by economic surplus. The size of the suspension effects depends largely on the volumes of navels shipped during the suspension and crop size.