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Diversification, Vertical Integration, and the Regional Pattern of Dairy Farm Size

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Dairy farm size differs considerably across the United States. We analyze patterns of dairy farm size to determine how differences in vertical integration and diversification relate to farm size. We find that diversification accounts for little size variation. For vertical integration, the partial correlation with dairy herd size is strongly negative. Dairy value-added size measures vary less across regions than herd size, indicating that an important part of herd size variation relates to vertical integration. Nonetheless, dairy farms in the Pacific and South regions remain much larger than farms in the traditional dairy regions, even when accounting for vertical integration.
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Document Type: Research Article

Affiliations: 1: University of California, Davis and a member of the Giannini Foundation of Agricultural Economics, 2: Department of Agricultural Economics at Michigan State University

Publication date: December 1, 2002

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