Regression analysis was used to estimate the relationship between quantities of quota and rental rates and between labor use, wages and quota for North Carolina for the years 1966 through 1969 and for each of the other flue-cured tobacco producing states for the years 1966 through 1968. The impact of probable changes in aggregate quota and the wage rate of hired labor on rental rates within counties was estimated using regression coefficients. The estimated reservation demand curves for county quota markets were used to project transfers of quota between counties which might occur if wider transferability was allowed. The rental rate which might prevail within the state under various transfer rules was also estimated. In no case did the estimates vary greatly from average observed rental rates. Large quantities of quota were projected to move from the Old and Middle Belts to the Eastern and Border Belts. Estimates of the transfers across state boundaries under various program rules were also made. The impact of the hypothetical transfers across county lines on the efficiency of production and the distribution of income was also estimated. While aggregate gains within North Carolina could be substantial, producers in high-rent counties and owners in low-rent counties would gain while producers in low-rent counties and owners in high-rent counties would lose from the initiation of a statewide quota transfer program.


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