Applied Economics Teaching Resources

an AAEA Journal

Agricultural and Applied Economics Association

Case Study

Applied Economic Models of Commodity and Input Markets to Assess Prices, Quantities, Farm and Other Input Supplier Impacts, and Consumer and Taxpayer Costs

Joe Dewbre(a), Wyatt Thompson(b), Sera Chiuchiarelli(b)
(a)Private Economist, (b)University of Missouri

JEL Codes: JEL Codes: A29, Q02, Q11
Keywords: Market model, market equilibrium, agricultural supplier impacts, corn, hogs, pork, winners and losers

Publish Date: May 30, 2024
Volume 6

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The impacts of exogenous market and policy developments reverberate up and down the farm to the retail marketing chain, affecting consumer prices, farm input prices, and the economic well-being of many people. Applied economists have developed analytical tools that trace how developments at one point in the supply chain may affect prices and quantities at other points. The particular analytical tools proposed here aim to provide students with hands-on experience in using market models and real data to simulate relevant policy and market scenarios. We start with a simple model representing only the supply and demand for corn and end with a vertically integrated model that links corn, hog, and pork markets. Each phase of model development gives a chance to build and test economic intuition about how price effects come about and their impacts on various market participants: who benefits and who pays—the winners and losers.

About the Authors: Joe Dewbre is a Private Economist ( Wyatt Thompson is a Professor at the University of Missouri ( Sera Chiuchiarelli is an International Market and Policy Analyst Senior Research Associate at the University of Missouri (

Acknowledgements: This material is based in part on work supported by the U.S. Department of Agriculture, under Agreement No. 58-0111-22-015 and the USDA National Institute of Food and Agriculture, Hatch project number MO-HASS0024. Any opinion, findings, conclusions, or recommendations expressed in this publication are those of the authors and do not necessarily reflect the view of the U.S. Department of Agriculture nor their employers.

Copyright is governed under Creative Commons CC BY-NC-SA


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