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| Quear, Justin; Tyner, Wallace E.. |
| The federal government currently subsidizes ethanol with a fixed payment of $.51/gallon of ethanol blended with gasoline. Ethanol profitability is closely linked to the prices of corn and ethanol. The purpose of this paper was to develop a variable subsidy based on corn and ethanol prices and then to compare that variable subsidy with the fixed subsidy. This analysis proceeded in several distinct steps: First, we estimated ethanol profitability over a wide range of ethanol, corn, and distillers grains prices. This data was used in a regression analysis to estimate the ethanol profitability from the set of corn and ethanol prices. The regression coefficients became the basis for the variable subsidy. A version of the subsidy that used gasoline prices... |
| Tipo: Working or Discussion Paper |
Palavras-chave: Agricultural and Food Policy; Resource /Energy Economics and Policy. |
| Ano: 2006 |
URL: http://purl.umn.edu/28636 |
