Producer Revenue Effects of Federal Marketing Order Quality Standards

摘要

Most Federal marketing orders for fruits, vegetables, and horticultural specialties authorize setting minimum shipping standards for grades and sizes. In many orders, this is the only type of provision authorized that can influence commodity supplies. This study attempts to separately measure the supply-decreasing and demand-increasing effects of order imposed standards. A positive relationship between quality and demand was found in only 4 of the 17 commodities studied. For 9 other commodities, demand was inelastic in the vicinity of normal seasonal sales, suggesting that standards could be strengthened during years of heavy crops to prop producer revenues.