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The Impact of Component Pricing of Soybeans and Milk
Author(s) -
Perrin Richard K.
Publication year - 1980
Publication title -
american journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.949
H-Index - 111
eISSN - 1467-8276
pISSN - 0002-9092
DOI - 10.2307/1240199
Subject(s) - commodity , component (thermodynamics) , economics , value (mathematics) , microeconomics , agricultural economics , agricultural science , business , mathematics , statistics , biology , finance , physics , thermodynamics
Currently, the price that an individual farmer receives for soybeans is not adjusted for oil and protein content, and the price for milk is adjusted for fat content but not for solids‐not‐fat. This study finds that the potential social surplus gains from a change to component pricing of these commodities is small (no more than one to two percent of current commodity value, before deducting the extra costs of such a pricing system). Substantial transfers would occur between component‐consuming groups, while producers as a group would be affected only slightly.