Grain Exporting Economics: Port Elevator Cost Simulations

Magid A. Dagher, Bruce J. Reynolds and Lynn W. Robbins

No 312997, Research Reports from United States Department of Agriculture, Rural Development

Abstract: A major challenge for cooperatives involved in grain exporting has been to achieve adequate economies of size to be competitive while maintaining the flexibility to operate in a business that is also highly cyclical. Significant economies of size are often attributed to grain exporting, but until recently empirical estimation has been lacking. An economic-engineering technique is used to simulate cost curves for port elevators over a range of capacities. These results are used to construct longrun costs for identifying the economies and diseconomies of size. The simulation model is also applied to economies in the short run. An example is developed that uses simulation for managerial decisions when operating with excess port elevator capacity.

Keywords: Crop Production/Industries; International Relations/Trade; Marketing; Research Methods/Statistical Methods (search for similar items in EconPapers)
Pages: 22
Date: 1986-11
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Persistent link: https://EconPapers.repec.org/RePEc:ags:urdbrr:312997

DOI: 10.22004/ag.econ.312997

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