Copyright (c) 2008 Berkeley Electronic Press All rights reserved. http://www.bepress.com/jafio Recent documents in Journal of Agricultural & Food Industrial Organization en-us Wed, 02 Jul 2008 03:49:16 PDT 3600 http://www.bepress.com/jafio/vol6/iss1/art4 http://www.bepress.com/jafio/vol6/iss1/art4 Mon, 30 Jun 2008 13:32:51 PDT In this paper we estimate the farmers' side welfare effects of a hypothetical regulatory scenario that would partially eliminate production contracts in the hog industry. Using the Agricultural Resource Management Survey (ARMS) data for 2004, farmers' production costs under different marketing arrangements are estimated and then used to recover their individual risk aversion parameters with the help of a structural expected profit maximization model. The results show that farmers who use production contracts are more risk averse than farmers who use spot markets or marketing contracts. The regulation that forces producers to market their hogs in a riskier marketing channel relative to the channel they themselves selected imposes large welfare losses on the affected farmers. Xiaoyong Zheng Q12 Q13 Q18