Under the theory of economies of scale, the size of farms, like that of all industries, should increase over time due to improvements in productivity. Farmers themselves understand that the more land they farm, the greater their output and, thus, the larger their potential incomes. Government policies are highly intrusive in agriculture and can distort this dynamic. Often, the social goal is to keep more farmers employed, even at the cost of overall agricultural efficiency. The scale of farms in a country typically correlates with many other societal attributes. Because scale typically means cheaper food and, thus, a lower share of disposable income, societies with larger farms are usually wealthier and have more income for other sectors, s...
Communicating importance of value-added products
Facing increasing pressure to quantify the value of export promotion efforts to investors, a U.S. industry organization retained WPI to develop a quantitative model that better communicated the importance of exports. The resulting model concluded that value-added meat exports contributed $0.45 cents per bushel to the price of corn, increasing support for that sector’s financial support of WPI’s client. In addition to serving the red meat industry with this type of analysis, WPI has generated similar deliverables for the U.S. soybean and poultry/egg industries.