Evaluating policy design choices for the margin protection program for dairy producers: An expected indemnity approach

John Newton; Cameron S. Thraen; Marin Bozic

doi:10.1093/aepp/ppv033

Evaluating policy design choices for the margin protection program for dairy producers: An expected indemnity approach

John Newton, Cameron S. Thraen, Marin Bozic

Applied Economics

Research output: Contribution to journal › Article › peer-review

4 Scopus citations

Abstract

The Agricultural Act of 2014 replaced dairy product price supports and countercyclical income support payments with the Margin Protection Program for Dairy Producers. Using farm-level data, producer decisions and aggregate policy costs under a variety of risk environments and policy design alternatives are simulated. Fixed premium rates may result in budget outlays that are substantially higher than for equivalent variable-rate insurance subsidized at levels observed in revenue-based crop insurance policies. Due to the absence of adjusted gross income or production eligibility constraints, a significant portion of benefits may accrue to a small share of large dairy farms.

Original language	English (US)
Pages (from-to)	712-730
Number of pages	19
Journal	Applied Economic Perspectives and Policy
Volume	38
Issue number	4
DOIs	https://doi.org/10.1093/aepp/ppv033
State	Published - Dec 2016

Bibliographical note

Publisher Copyright:
© 2015. Oxford University Agricultural and Applied Economics Association. All rights reserved.

Copyright:
Copyright 2021 Elsevier B.V., All rights reserved.

Keywords

Agricultural act of 2014
Dairy
Farm program decisions
Margin protection program
Monte-Carlo simulations

UN SDGs

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Evaluating policy design choices for the margin protection program for dairy producers: An expected indemnity approach

Abstract

Bibliographical note

Keywords

UN SDGs

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