Measuring producer welfare under output price uncertainty and risk non-neutrality |
| |
| Authors: | David S. Bullock Philip Garcia Kie-Yup Shin |
| |
| Affiliation: | David S. Bullock (email: ) is an Associate Professor and Philip Garcia is a Professor in the Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, Urbana, Illinois, USA. Kie-Yup Shin is a Senior Researcher at the National Agricultural Cooperative Federation, Seoul, Korea. |
| |
| Abstract: | ![]()
Procedures to measure the producer welfare effects of changes in an output price distribution under uncertainty are reviewed. Theory and numerical integration methods are combined to show how for any form of Marshallian risk-responsive supply, compensating variation of a change in higher moments of an output price distribution can be derived numerically. The numerical procedure enables measurement of producer welfare effects in the many circumstances in which risk and uncertainty are important elements. The practical ease and potential usefulness of the procedure is illustrated by measuring the producer welfare effects of USA rice policy. |
| |
| Keywords: | price uncertainty risk non-neutrality welfare economics |
|
