An analysis of the effects of selected factors on minimum resource requirements with special emphasis on implications for farm firm growth in a major rice producing area of Texas

Abstract

This study was designed primarily to determine the requirements for survival and potentials for growth for rice farms in the Texas Gulf Coast Prairie under alternative price-cost and institutional assumptions. There were 2 principal objectives of the study. The first objective was to determine the minimum starting equity and the level of resources needed to attain specified initial levels and rates of increase in family consumption expenditures. Specified changes in net worth ranging from zero to average annual increases of 6 percent were included in the analysis. Also included as variables were specified rates of change in selected input prices, alternative leasing restrictions and a projected equilibrium free market condition as an alternative to 1970 government programs. The second principal objective was to determine the maximum potential growth given the initial minimum resource situations determined in the first objective of the analysis. A multiperiod linear programming model with a 10-year planning horizon was developed for the analysis. A cost-minimizing objective function was used for the first objective of the study and an income-maximizing function was used for the second objective. ...