Consumption of lowfat and skim milk has increased substantially over the past decade. This study investigates whether the change is due to price and expenditure effects or to a more fundamental preference change in milk demand. Parametric and nonparametric analytical approaches provide a...

Hedgers located far from organized commodity exchanges suffer a mismatch between their local prices and exchange prices. Futures and options traded on the exchange may still be valuable to distant hedgers, but only to the extent that basis risk is small. Forward contracting allows hedgers to...