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United States Department of Agriculture

Agricultural Research Service

Title: Technology Choice under Changing Peanut Policies

Authors
item Price, Jeffrey - VA DEPT. TRANSPORTATION
item Lamb, Marshall
item Wetzstein, Michael - UGA

Submitted to: Journal of Agricultural and Applied Economics
Publication Type: Peer Reviewed Journal
Publication Acceptance Date: June 1, 2005
Publication Date: N/A

Interpretive Summary: The effect of marketing quotas and price supports on technology adoption are examined for peanut production in the Southeastern United States using a real options model of investment with output price and yield uncertainty. The optimal choice of peanut production technology (dryland versus irrigated) in the Southeast is shown to depend on price supports and how they change. The manner in which price supports change will have an effect on the choice and rates of abandonment or adoption of production technologies.

Technical Abstract: The effect of marketing quotas and price supports on technology adoption are examined for peanut production in the Southeastern United States using a real options model of investment with output price and yield uncertainty. The optimal choice of peanut production technology (dryland versus irrigated) in the Southeast is shown to depend on price supports and how they change. The manner in which price supports change will have an effect on the choice and rates of abandonment or adoption of production technologies.

Last Modified: 12/19/2014
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