Is stabilization of potato price effective? Empirical evidence from the Idaho Russet Burbank potato market

High fresh potato price volatility, decreasing demand for fresh potatoes, and potato prices below the cost of production led to a decision of a group of Idaho potato growers to organize the United Potato Growers of Idaho, a marketing cooperative. The potato supply management program was developed to coordinate production and marketing of fresh potatoes. To evaluate the effectiveness of this program, the authors examine the level and volatility of Idaho Russet Burbank weekly shipping point prices during two periods: before the cooperative was organized and when the cooperative was in the market. They found empirical evidence suggesting that the analyzed prices were higher and less volatile during the period when the cooperative was in the market. © 2010 Wiley Periodicals, Inc.