Efficiency losses in milk marketing boards - the importance of exports

Rolf Jens Brunstad, Ivar Gaasland and Erling Vårdal ()

Nordic Journal of Political Economy, 2005, vol. 31, 77-97

Abstract: A milk marketing board (MMB) is a well known instrument for regulating the markets for dairy products. MMBs are based on price discrimination, and receipts from sales are pooled so that the farmers receive a single price adjusted for composition and quality. Using a numerical model, we find that the economic welfare cost of the Norwegian MMB, is as much as 26.3% of the milk production value. This computed cost is far larger than for the other countries with MMBs. The main reasons are that exports are a major ingredient of the Norwegian system, and that production costs are very high

Keywords: Milk marketing boards; Norwegian dairy policy; price discrimination (search for similar items in EconPapers)
JEL-codes: D58 L52 Q13 (search for similar items in EconPapers)
Date: 2005
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Citations: View citations in EconPapers (3)

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