Economies of Scale in the Floriculture Industry

Sara K. Schumacher and Thomas L. Marsh

Journal of Agricultural and Applied Economics, 2003, vol. 35, issue 03

Abstract: This study investigated the cost structure of the floriculture industry in the United States. Economies of scale and input elasticities were estimated with a normalized quadratic cost function. Results suggest that economies of scale exist in the floriculture industry. As producers become large and more automated, they have a cost advantage relative to smaller producers who are producing the same output product mix. The existence of economies of scale suggests that average grower size can increase in the future as growers increase in size to take advantage of cost efficiencies.

Keywords: duality; economies of scale; floriculture; nonprice variables; Q12; C31; D20 (search for similar items in EconPapers)
Date: 2003
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