Non-jointness and scope economies in the multiproduct symmetric generalized McFadden cost function

Stewart, Kenneth G.

doi:10.1007/s11123-009-0141-y

Cited by 4 publications

(2 citation statements)

References 18 publications

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“…This hypothesis is consistent with the overall non-significance of the parameter matrices E, B and G (Wieck & Heckelei, 2007), where the parameters e mn , b kl and g mk are the elements of the i th row and j th column of the respective matrices. By ruling out the presence of constant economies of scale, we are also able to reject the hypothesis of homotheticity (Stewart, 2009 Table 4 gives the estimated marginal costs, excess of family labour and land fixed factor inputs, and milk price per zone and herd size over the period 2003/05. It also includes the level of significant variation in farm costs by zone and herd size and the combined effect, Zone × Size.…”

Section: Specification and Estimation Of The Panel Data Modelmentioning

confidence: 99%

Feed prices and production costs on Spanish dairy farms

Casasnovas-Oliva¹,

Aldanondo-Ochoa²

2014

Span. j. agric. res.

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This paper analyses the impact of livestock feed prices and pasture quality on the long and short-term costs of milk production in a region of Spain (Navarre). The empirical results are obtained from the estimation of a flexible shortrun cost function, followed by the approximation of long-run equilibrium based on the quasi-fixed factors adjusted to their optimal levels. The results reveal a high sensitivity of milk production costs to changes in livestock feed prices due to two reasons. One is that, as milk production expands, it tends to become technologically more intensive. The other is that, in the current structure of dairy farming, land input is suboptimal, particularly in the case of large farms and areas of poor pasture. The results reveal that short-run substitution between feed and livestock is a potential strategy for farms to respond to feed price increases. They also suggest that structural policies designed to strengthen the dairy sector's competitiveness should vary according to agro-climatic conditions. In areas of poor pasture, herd growth might be used as a long-term measure to increase competitiveness through economies of scale; while the alternatives for farms in better-endowed regions also include extensification of dairy production.

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Section: Specification and Estimation Of The Panel Data Modelmentioning

confidence: 99%

Feed prices and production costs on Spanish dairy farms

Casasnovas-Oliva¹,

Aldanondo-Ochoa²

2014

Span. j. agric. res.

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“…Similar cost functions have been used to estimate cost parameters of companies (Baumol 1987, Evans and Heckman 1984, Stewart 2009). There are many possible treatments for an experimental analysis of an expressive bidding language.…”

Section: Cost Functionsmentioning

confidence: 99%

Compact bidding languages and supplier selection for markets with economies of scale and scope

Bichler

Schneider

Güler

et al. 2011

European Journal of Operational Research

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Combinatorial auctions have been used in procurement markets with economies of scope. Preference elicitation is already a problem in single-unit combinatorial auctions, but it becomes prohibitive even for small instances of multiunit combinatorial auctions, as suppliers cannot be expected to enumerate a sufficient number of bids that would allow an auctioneer to find the efficient allocation. Auction design for markets with economies of scale and scope are much less well understood. They require more compact and yet expressive bidding languages, and the supplier selection typically is a hard computational problem. In this paper, we propose a compact bidding language to express the characteristics of a supplier's cost function in markets with economies of scale and scope. Bidders in these auctions can specify various discounts and markups on overall spend on all items or selected item sets, and specify complex conditions for these pricing rules. We propose an optimization formulation to solve the resulting supplier selection problem and provide an extensive experimental evaluation. We also discuss the impact of different language features on the computational effort, on total spend, and the knowledge representation of the bids. Interestingly, while in most settings volume discount bids can lead to significant cost savings, some types of volume discount bids can be worse than split-award auctions in simple settings.

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