Checkoff Programs Research Articles

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We analyzed the impact of ‘Hanwoo beef promotional sales events’, part of the Hanwoo Beef Checkoff Programs, on the volatility and rate of return for both Hanwoo and Handon wholsale prices. In order to account for information asymmetry and investigate the relationship between volatility and the rate of return, we employed the GJR-GARCH model combined with the GARCH in mean model. Our findings reveal that the implementation of ‘promotional sales events’ had a stabilizing effect on Hanwoo beef prices by lowering their volatility. It is also found that the rate of return increased. As price volatility increased, indicating an associated rise in the risk premium due to heightened market risk. Although the implementation of these events did not show statistical significance in influencing the rate of return for Handon pork, it was observed to have a marginal impact on price volatility.

Assessing Economic Effects of the Hanwoo Checkoff Program

This paper investigates the economic effects of the Hanwoo checkoff programs. We analyze the impacts of the consumer promotion and the stabilization program of the Hanwoo checkoff on the various market participants of the industry. Acknowledging the economic evaluation of the checkoff program can be overestimated by ignoring the multi-market characteristics of the beef industry, we explicitly modeled each level of vertically related markets of the Hanwoo industry. This study constructs a partial equilibrium model for the multi-market structure of the Hanwoo industry, which basically represents the behavior of various market participants. To measure quantitatively the economic impacts of the Hanwoo checkoff, we employed the EDM. The results indicate that Hanwoo checkoff program affects positively the equilibrium price and quantity in most market levels of the industry. The Hanwoo checkoff promotion boosts the retail market price and quantity by 2.618% and 0.831%, respectively, while the stabilization program raises the wholesale price and quantity by 0.275% and 0.200%, respectively. The scheduled tariff rate reduction decreases the equilibrium quantity of the domestic beef market in general.

USDA Agricultural Checkoff Programs’ YouTube Presence and Video Quality

YouTube has existed since 2005. Since that time, many marketing professionals have used the site to combine sight, sound, motion, and emotion to appeal to a target audience. USDA-regulated and producer-funded agricultural research and promotion, or checkoff programs, are no different, and many have used YouTube’s platform to reach consumers. This study analyzed the USDA-overseen commodity checkoff programs’ YouTube presence for views, subscribers, mean length, and number of posted videos. Researchers also analyzed the overall quality of videos, visual frames of the most popular videos, and the quality of the group’s YouTube homepage.The YouTube pages were mostly consistent with the brand and categorized videos into playlists, or frames, with recipe videos being the most common. The most watched video had more than nine million views. In many instances, high quality garnered higher viewership, but not always. Content targeted at the audience brought lots of views, more so than quality. Videos that were approximately one minute in length, in general, were viewed more often than longer videos.

Check Your Rights at the Door: Rethinking Confiscatory Regulation

Traditionally, regulatory takings scholarship has focused myopically on real property. Instead, this article explores an underappreciated side of the Takings Clause, offering a systematic analysis of the various strands of takings law that may affect regulation of commercial activity. I give special attention to two fresh U.S. Supreme Court decisions that may invite legal challenges to regimes and regulatory practices that have gone unchallenged in the past. The Supreme Court’s decision in Horne v. U.S. Department of Agriculture, 135 S.Ct. 2419 (2015), makes clear that commercial regulation violates the Takings Clause if it conditions the right to engage in commerce on a requirement to surrender specifically identified personal assets. Likewise, the Court’s decision in Koontz v. St. Johns River Water Management District, 133 S.Ct. 2586 (2013), opens the door for commercial actors to contest exorbitant or unnecessary fees imposed in various regulatory permitting regimes. Accordingly, Horne and Koontz call into question a few common forms of economic regulation, including agricultural check-off programs, certain required pay-check deductions, regulatory authorizations to use company property for non-business purposes, cap-and-trade regulation and other regimes. Yet most regulatory impositions will survive constitutional scrutiny. Accordingly, this article seeks to demarcate the line between ‘confiscatory regulation’ that is vulnerable to challenge and the broader realm of economic regulation that must survive. I argue that this demarcation is firmly rooted in settled takings doctrine, which distinguishes between use restrictions and physical appropriations of private property. Accordingly, since Horne makes clear that all forms of property are protected on equal terms, the Takings Clause generally forbids government from conditioning the right to engage in commerce on a requirement to hand-over identified commodities, products, monies or any other asset. Absent an affirmative defense, such regulation must be enjoined — or, otherwise, “just compensation” must be paid.

The Ramifications of Nearly Going Dark: A Natural Experiment in the Case of U.S. Generic Orange Juice Advertising

Evaluations of generic advertising programs by commodity check-off programs involve analyses of counterfactual scenarios in which advertising and promotion expenditures are set to zero over the program's history. In actual practice, the counterfactual is rarely realized. We present a case in which such a natural experiment occurred when generic advertising and promotion expenditures for U.S. orange juice were cut nearly to zero. Using structural econometric and autoregression models, we estimate losses in consumption and sales revenue and examine the time required for the market for orange juice to recover from the check-off's strategy of going nearly dark.

Understanding the U.S. Generic Advertising System and Its Role in Information Management Among Commodities and Food Systems

Information is essential to growing demand and maintaining efficiency throughout the supply chain for any commodity. The U.S. model for facilitating producers and first handlers having a proactive role in the flow of information about their products is through commodity checkoff programs. These industry administrated programs fund generic advertising and promotions usually through a mandatory assessment. Success of any of these programs depend on the administrative structure, the message, the ability to judge performance, and the overall equity in sharing in the program created benefits.

Voluntary Funding for Generic Advertising Using a Provision Point Mechanism: An Experimental Analysis of Option Assurance

The mandatory nature of check-off programs remains a contentious policy issue. A provision point mechanism with a money-back guarantee offers an attractive, alternative voluntary funding approach, yet faces the problem of how to maintain future administrative capacity should contributions fall short of the funding threshold in the present period. To address this concern, a novel two-threshold, provision point mechanism is tested that sets a high threshold to fund marketing and a low threshold, if necessary, to secure administrative capacity for future advertising. Experimental results demonstrate that providing such “option assurance” sustains high overall contributions and, in some settings, can increase producer surplus.

The Arkansas Beef Industry — A Self-Assessment

<h2>ABSTRACT</h2> A mail survey was conducted to determine the current strengths and limitations plus future opportunities and threats for 5 segments of the Arkansas cattle industry. Producers with small cow-calf herds (≤ 50 cows) placed a high value on lifestyle and were concerned with rising production costs and decreasing opportunities to buy land. Respondents with large cow-calf herds (> 50 cows) cited their marketing options and ability to utilize production technology as a strength but were worried about market volatility, environmental regulations, production costs, and disease outbreak. Stocker cattle respondents cited the strategic location of Arkansas as a major advantage but were worried about input costs, cattle health, lack of cattle uniformity, and small margins. Improving calf quality and grouping cattle into uniform groups were identified as future opportunities, and costs of production, environmental regulation, and animal rights and environmental activists were future threats. Purebred respondents were concerned with profitability, environmental and public issues, and the limited value that many commercial cow-calf producers seem to place on herd sires. Opportunities were genetic advancements and education. The support industry saw itself as a primary component of the producer education system with an uninformed industry as their greatest threat. The support industry was worried about the continued consolidation of the support industry itself. The most preferred educational methods were newsletter and printed material, followed by on-farm demonstrations, one-on-one consultation, and experiment station field days. Traditional group meetings were not preferred. Thirty-five percent of the respondents were > 60yr old, and 68% had > 20yr experience. Respondents with large cowcalf (3.0 ± 0.14), stocker (3.1 ± 0.14), and purebred (3.0 ± 0.14) herds had a greater knowledge of the Beef Checkoff programs than respondents with small cow-calf herds (2.8 ± 0.14) and support industries (2.7 ± 0.14; P < 0.05). Respondents with > 20yr of experience (3.0 ± 0.09) had a greater (P < 0.05) knowledge of the Beef Checkoff program compared with respondents with < 20yr experience (2.8 ± 0.09). There was an 80% approval rate for the Beef Checkoff program with no differences between segments (P > 0.05). Respondents with small cow-calf herds and support industry representatives were not as likely (P = 0.02) to hold membership in National Cattlemen's Beef Association as the other segments. Since the Arkansas industry is similar to that of many states, this information can assist the educator on identifying topics and educational methods to reach each segment of the industry.

Federal Communication about Obesity in the Dietary Guidelines and Checkoff Programs*

The new Dietary Guidelines for Americans focus on obesity prevention. They recommend increased consumption of whole grains, fruits, vegetables, fish, and low-fat dairy products, within a balanced diet whose total calories have been moderately reduced. Meanwhile, other well-known and well-funded federally sponsored consumer communications promote increased total consumption of beef, pork, and dairy products, including energy dense foods such as bacon cheeseburgers, barbecue pork ribs, pizza, and butter. These latter communications are sponsored by the federal government's commodity promotion programs, known as "checkoff" programs. The programs are established by Congress, approved by a majority of the commodity's producers, managed jointly by a producer board and the U.S. Department of Agriculture, and funded through a tax on the producers. The federal government enforces the collection of more than 600 million US dollars annually in mandatory assessments, approves the advertising and marketing programs, and defends checkoff communication in court as the federal government's own message-in legal jargon, as its own "government speech." Federal support for promoting fruits and vegetables is small by comparison. The checkoff programs recently have become more clearly identified as federal programs. After a recent decision by the U.S. Supreme Court upholding the constitutionality of the checkoff programs, calls for consistency with the Dietary Guidelines may get louder. The current inconsistencies in federal communication undermine the effectiveness of the Dietary Guidelines as an antidote to the shortcomings of the private sector market for information about weight and obesity.

Distributional issues in check‐off funded programs

AbstractAgricultural commodity taxes, called check‐offs, are used to finance promotion, research, and other activities that can be regarded as industry collective goods. The collection of the check‐offs and the programs they are used to fund have implications for the welfare of consumers, other producers, and taxpayers in addition to their effects on those producers who are allowed to vote in the procedures for authorizing the programs. As well as simple fairness or equity considerations, such shifting of the incidence of benefits and costs to others can lead to a divergence between producer and national optimal choices, and hence efficiency losses. From a public policy perspective, then, the implications for others ought to be considered in the design of the enabling legislation, in the evaluation of the specific programs, and in the rules governing the behavior of the agricultural producer groups engaged in commodity check‐off programs. [EconLit citations: Q180, Q130, H420]. © 2003 Wiley Periodicals, Inc. Agribusiness 19: 277–287, 2003.

Distribution of benefits and costs of commodity checkoff programs: Introductory remarks

Distribution of benefits and costs of commodity checkoff programs: Introductory remarks

Taxes and Voluntary Contributions: Evidence from State Tax Form Check-off Programs

This paper analyzes taxpayer contributions to state check-off funds using four years of Kentucky household income tax data. An ordered probit shows that a taxpayer tends to give to more check-off f...

Research Contributions from the Soybean Checkoff Programs

Research Contributions from the Soybean Checkoff Programs

Commodity checkoff programs as alternative producer investment opportunities: The case of soybeans

Evaluations of commodity checkoff programs generally involve benefit-costs analyses. The typical benefit-cost approach, however, provides no clear criteria for judging whether program benefits exceeds the costs sufficiently to warrant continuation of the program. This article proposes a method for evaluating a commodity checkoff program as an alternative investment opportunity facing producers which allows a ranking of the program among investment alternatives facing producers. The procedure is demonstrated through an analysis of the soybean checkoff promotion program. The analysis clearly indicates that the soybean checkoff program has performed well as an investment alternative for soybean farmers and warrants consideration for continuation. In contrast, a benefit-cost analysis of the soybean checkoff program yields ambiguous results regarding both the magnitude of the producer benefit and whether the benefit is sufficiently large relative to cost to justify continuation of the program. [Econ-Lit citations: Q130, M300, M370] © 1999 John Wiley & Sons, Inc.

The science and art of promotion evaluation

Over the past two decades commodity checkoff programs have proliferated. In 1996 legislation was passed that requires these programs to be evaluated at least once every 5 years. Because of this legislation there are now potential legal and monetary implications associated with these evaluations. Consequently, for all parties concerned two questions naturally arise: what is the scientific status of promotion evaluations? How can promotion evaluations be improved?This article attempts to answer these questions by exploring the scientific and artistic aspects of the central activity involved in all promotion evaluations: modeling. Attention centers on the scientific assumption choice set that is available to modelers, the tradeoffs involved in making certain assumption choices, and how assumption choices may be improved in general. These ideas are discussed in the context of a sample of promotion evaluation studies. [Econ-Lit citations: B4, D6, Q13] © 1999 John Wiley & Sons, Inc.

Confirmation and Misspecification Testing of Generic Advertising Econometric Studies

Many producer groups through checkoff programs are now using generic advertising to promote their products. Past research has generally shown that generic advertising succeeds in increasing demand. Given that this research is being used to justify checkoff programs, it seems worthwhile to reexamine some previous research results. Five previously published milk generic advertising econometric models are reestimated and tested for misspecification. While the exact data were not obtained in one case, the original reported results are generally confirmed as being accurate. Only one model, however, is found well specified. Generic advertising elasticities from correctly specified models are somewhat smaller than those in the original studies, but still support the effectiveness of generic advertising.

Economic effects of an advertising excise tax

Graphical analysis is used to demonstrate the effects of an advertising excise tax on price, output, and welfare. Results indicate the costs of advertising check-off programs in general are not borne entirely by producers but rather are passed on in part to consumers in the form of higher retail prices. Consequently, (a) estimates of producers' returns to advertising that ignore the incidence of the advertising tax will be understated, (b) the ability to shift the advertising tax gives producers an added incentive to support check-off programs, and (c) because advertising check-off programs affect consumer as well as producer surplus (i.e., have social welfare implications) government oversight is warranted.

Political Finance and Political Reform: The Experience with State Income Tax Checkoffs

This article is a comparative analysis of state income tax checkoff programs adopted between 1973 and 1979 that grew out of the Watergate era and were intended to reform methods of political finance in state elections. The descriptive characteristics of these programs are examined, their economic performance, factors contributing to economic success and program type, and the political behavior of taxpayers choosing whether to exercise the checkoff option and, if so, which suboptions they choose. Finally, a reform model based on recent works is offered as a basis for judging the performance of tax checkoffs. It is suggested that the performance of most checkoff programs falls considerably short of the expectations of the model.