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Aggregate and Farm-level Productivity Growth in Tobacco: Before and After the Quota Buyout

Permanent URL:
http://handle.nal.usda.gov/10113/56995
Abstract:
We examine the distortionary effects of agricultural policy on farm productivity by examining the response of U.S. tobacco farmers’ productivity to the quota buyout of 2004. We focus on the impact of distortionary policy, i.e., the tobacco quota, by decomposing aggregate productivity growth into the contribution of farm-level productivity growth and the contribution of reallocation of resources among tobacco growers. We find that the aggregate productivity of Kentucky tobacco farms grew 44% between 2002 and 2007. The elimination of quota rental costs and reallocation of resources, including entry and exit, accounted for most of the post-buyout productivity growth.
Author(s):
Barrett E. Kirwan , Shinsuke Uchida , T. Kirk White
Subject(s):
Nicotiana tabacum , agricultural policy , crop production , farms , growers , tobacco , Kentucky
Source:
American journal of agricultural economics 2012 v.94 no.4
Language:
English
Year:
2012
Collection:
Journal Articles, USDA Authors, Peer-Reviewed
File:
Download [PDF File]
Rights:
Works produced by employees of the U.S. Government as part of their official duties are not copyrighted within the U.S. The content of this document is not copyrighted.