Anti‐Corporate Farming Laws and Industry Structure: The Case of Cattle Feeding

Abstract

Nine midwestern states have laws that restrict the involvement of publicly held corporations in agriculture. Opponents argue that the laws' direct efforts to regulate ownership structure may have an adverse indirect impact on size structure. Restricting corporate involvement might stifle the emergence and growth of efficient, large-scale establishments if corporations have advantages over other organizational forms in meeting capital requirements. Since 1982, Nebraska has had an anti-corporate farming law that prohibits corporate ownership of feedlots. We test whether the implementation of the Nebraska law had an impact on the stochastic process governing the evolution of the state's feedlot size distribution. Copyright 2006, Oxford University Press.

Business groups and competition in post-Soviet transition economies: The case of Russian “agroholdings”

“…11 Nevertheless, empirical studies show that the restrictive legal environment did have some influence on business organization (e.g., Schroeter et al 2006;Welsh et al 2001). Against this background, the industry 9 Becht and DeLong (2007) explain why: "Americans love the market because it makes them free and gives them the power to say no… But suppose that there is only one monopolist?…”

“…Minnesota's anti-corporate farming law specifically states that it is in the interests of the state to promote and protect "the family farm as a basic economic unit, to insure it as the most socially desirable mode of agricultural production, and to enhance and promote the stability and well-being of rural society in Minnesota and the nuclear family" (cited in Welsh et al 2001: 544). Further fears were that up-and downstream conglomerates might control prices and boost their profits at the expense of the farmers and corporate farm operators might harm the land and destroy American ideals of independence, selfreliance, and enterprise (Schroeter et al 2006(Schroeter et al : 1000Welsh et al 2001: 543f). Similar arguments back the government support for small family farms in European countries, e.g., Germany (see e.g.…”

Green Harms and Crimes

“…These laws are meant as a protective measure to preserve the family farm and thus the ownership of agriculture, but they also indirectly impact the size structure of the industry. Schroeter et al (2006) performed a cross-comparison between the top four cattle-feed producing states, where one -Nebraska -held such anti-corporate farming laws, but they found no strong evidence of these regulations affecting the cattle-feed industry. However, across all four states they did find an overall steady trend of feedlots increasing in size, suggesting that agribusiness slowly creeps into an industry regardless of the agricultural laws in place.…”

“…For example, public agencies need to provide the transport facilities that will enable the flow of inputs and products (Thompson, 1996). There is also growing concern for environmental impact, and without government regulation of the food industry, agribusiness corporations would underinvest in pollution control -something which market forces cannot singularly regulate (Schroeter et al, 2006). The key purpose of government intervention is the management of private land ownership, where domestically there are some government initiatives which exclude farmers with lower acreage or production levels from the opportunities that are given to agricorporations, amid a growing global agridomination in the developing world through land-grabbing (Tandon, 2010).…”

An Econometric Analysis of the Nebraska Livestock Friendly County Program

“…There is, however, a large volume of literature that examines the effect of demand and cost conditions on business location across states in the United States. Following Feinberg (2014), the literature can be categorized according to the following taxonomy: (1) the effect of state taxes on business location (e.g., Wasylenko 1997;Helms 1985;Bartik 1989), (2) the effect of general business climate on business entry, these include studies on the impact of environmental regulation and anti-corporate farming laws (e.g., Bartik 1988;Gray 1997;Roe et al 2002;Isik 2004, Schroeter et al 2006Azzam et al 2014), and (3) the effect of state antitrust enforcement (Feinberg 2014).…”