Welfare Analysis of the U.S. Ethanol Subsidy, A

Xiaodong Du (), Dermot Hayes and Mindy Baker
Authors registered in the RePEc Author Service: Mindy Lyn Mallory ()

Center for Agricultural and Rural Development (CARD) Publications from Center for Agricultural and Rural Development (CARD) at Iowa State University

Abstract: Based on a transparent analytical model of multiple markets including corn, ethanol, gasoline, and transportation fuel, this study estimates the welfare changes for consumers and producers resulting from ethanol production and related support polices in 2007. The welfare estimation takes into account the second-best gain from eliminating loan deficiency payments. The results suggest the total social cost is about $0.78 billion for given market parameters. We validate the model's underlying assumption and test for the results' sensitivity to assumed parameters.

Keywords: consumer surplus; deadweight loss; ethanol; subsidy; substitution. (search for similar items in EconPapers)
JEL-codes: D6 Q18 Q21 (search for similar items in EconPapers)
Date: 2008-11
New Economics Papers: this item is included in nep-agr and nep-ene
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Working Paper: A Welfare Analysis of the U.S. Ethanol Subsidy (2010)
Journal Article: A Welfare Analysis of the U.S. Ethanol Subsidy (2009)
Journal Article: A Welfare Analysis of the U.S. Ethanol Subsidy (2009)
Working Paper: A Welfare Analysis of the U.S. Ethanol Subsidy (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:ias:cpaper:08-wp480

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