A Dynamic Optimal Crop Rotation Model in Acreage Response

Ruohong Cai, John Bergstrom, Jeffrey Mullen and Michael E. Wetzstein

No 103949, Faculty Series from University of Georgia, Department of Agricultural and Applied Economics

Abstract: This paper presents a dynamic crop rotation model that shows how crop yield and price volatility could impact crop mix and acreage response under crop rotation considerations. Specifically, a discrete Markov decision model is utilized to optimize producers’ crop rotation decision within a finite horizon. By maximizing net present value of expected current and future profits, a modified Bellman equation helps develop optimum planting decisions. This model is capable of simulating crop rotations with different lengths and structures. Specifically, the corn-soybeans rotations were simulated using the crop rotation model.

Keywords: Crop Production/Industries; Research Methods/Statistical Methods (search for similar items in EconPapers)
Pages: 30
Date: 2011-05-04
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Citations: View citations in EconPapers (8)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:ugeofs:103949

DOI: 10.22004/ag.econ.103949

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