Success in maximizing profits and reasons for profit deviation on dairy farms

Loren Tauer and Zdenko Stefanides

Applied Economics, 1998, vol. 30, issue 2, 151-156

Abstract: The weak axiom of profit maximization (WAPM) was used to test how successful each of 70 individual New York State dairy farms was in maximizing profits using nine years of data. The netput vectors were corrected for technological change using nonparametric indices that do not require the assumption of profit maximization nor any functional form for the underlying technology. These technology indices are consistent with the nonparametric assumptions used in the WAPM tests. The average negative WAPM deviation over the 70 farms was 0.20, indicating that on average these farms could have selected available netput vectors that would have increased profits by 20% of total receipts. A tobit regression showed that the available characteristics on these farms explained very little of the variability in their abilities to select the best netput vectors. Yet, increased age and additional education increased the ability to select the best netput vector.

Date: 1998
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (17)

Downloads: (external link)
http://hdl.handle.net/10.1080/000368498325958 (text/html)
Access to full text is restricted to subscribers.

Related works:
Working Paper: SUCCESS IN MAXIMIZING PROFITS AND REASONS FOR PROFIT DEVIATION ON DAIRY FARMS (1997)
Working Paper: Success in Maximizing Profits and Reasons for Profit Deviation on Dairy Farms (1997)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:applec:v:30:y:1998:i:2:p:151-156

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/RAEC20

DOI: 10.1080/000368498325958

Access Statistics for this article

Applied Economics is currently edited by Anita Phillips

More articles in Applied Economics from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().