Premium
Competitiveness of U.S. Food Processing: Benefits from Primary Agriculture
Author(s) -
Gopinath Munisamy,
Roe Terry L.,
Shane Mathew D.
Publication year - 1996
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 - 10.2307/1243860
Subject(s) - agriculture , food processing , productivity , production (economics) , agricultural economics , economics , primary sector of the economy , agricultural productivity , food industry , business , food systems , natural resource economics , food security , economic growth , microeconomics , food science , geography , chemistry , archaeology
Abstract High‐value agricultural products such as processed foods are becoming increasingly important for both the production and trade of the United States. Efficiency gains in primary agriculture may be transferred to the processed food sector in the form of cheaper inputs because price declines and productivity growth have been coincidental in agriculture. In turn, efficiency gains in the processed food sector are transferred, in part, back to primary agriculture by increasing the derived demand and, thus, mitigating the decline in the latter's price. Efficiency gains are relatively more important in primary agriculture than in food processing. Policies which encourage productivity growth that lowers the production costs can increase the competitiveness of both sectors. The ultimate beneficiaries of the price declines in primary agriculture and food processing are consumers.