Agricultural Economics Research, Vol. 34 (Classic Reprint): July 1962

Explore how a detailed dairy submodel helps forecast prices and production under USDA policy choices. This article explains the structure and parameters of the dairy sector within the Food and Agricultural Policy Simulator (FAPSIM). It shows how the model endogenizes dairy supply, prices, and government stock actions to analyze policy options like changing price supports.This edition provides a clear look at how the dairy submodel fits into a broader simulation of agricultural markets. It covers how milk prices respond to government purchases, stock releases, and shifts in demand for dairy products, offering practical insights for researchers and policymakers.How dairy supply and milk prices are modeled in a unified system with other agricultural sectors.How government actions, such as purchasing and stock releases, influence product prices and availability.The structure of the four subcomponents: milk supply, milk price, milk manufacturing, and commercial demand.Empirical details on parameter estimates, validation, and scenario analysis for policy changes.Ideal for readers of agricultural policy analysis and economic modeling, especially those interested in how policy tools affect dairy markets and broader farm economics. Read more