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Abstract

Partial equilibrium analysis is used to estimate the social costs of production control in the Australian egg industry. These costs are compared with the estimates of the social cost of the home consumption price scheme which has operated in the past. The comparison is made for various supply and demand conditions and for alternative pricing and quota policies. The method used is to model historical supply and demand relationships for the years 1965-6 to 1972-3. Actual price and quantity data for these years is then used to estimate the social cost of home consumption pricing as it operated in that period. Simulated production controls are imposed on the model and the resulting social costs and benefits are estimated.

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