14 MASS. EXPERIMENT STATION BULLETIN 389 



As yet state control has not seriousl}' attempted any corrective program in this 

 direction. 



Rate variation becomes a source of market instability in two ways. In the 

 country, the existence of it tends to create a feeling of skepticism if not distrust 

 among shippers. An attitude of this sort makes the relationship between pro- 

 ducer and dealer vulnerable, which in turn is not conducive to permanency. 



The extent and incidence of rate- variation influences its force as an element of 

 instabilit^^ The range in rates is significant but chiefly w^hen associated with other 

 factors. Should the variation arise between groups fairly well separated, the 

 result would not be so disrupti\e as if the ^"ariation existed between routes within 

 an area or among producers on the same route supplying the same dealer.i^ 



Some of the skepticism pertaining to the cartage-rate situation is doubtless 

 due to the location of the rate-making authority. It is difficult if not impossible 

 to determine the extent to which dissatisfaction with cartage rates is due to the 

 carriers' or dealers' exclusive authority over them. It does not seem unreasonable 

 to infer, however, that since the shipper has no voice in the selection of the service 

 he might chafe a bit at also being deprived of the privilege of participating in 

 the making of rates for that service. 



In the market, the volume of milk handled at the various pick-up rates largely 

 determines the significance of rate-variation as a factor in market stability. The 

 net revenues derived from hauling operations are available for concessions which, 

 with price discounts now illegal, may be equally satisfactory in the form of 

 superior service; the direction taken by this eflfort being limited chiefly by the 

 operator's imagination. 



Cartage Rates Applicable Throughout the Milkshed 



Varying amounts were paid for milk-cartage service by 973 full-time producers; 

 sales were made to 40 dealers; shipments were made over 64 routes. 



Rates apparently were set for the most part on a per quart basis with the 

 actual rate rounded off^ to the nearest five-cent interval. The frequency distri- 

 butions in table 9 tend to illustrate the existence of the practice. The most 

 co«imon rate was 35 cents per hundredweight. Occasionally the total deduction 

 for Control Board assessments and hauling was 35 cents per hundredweight, 

 in which event the actual trucking levy was calculated to be i'i cents. 



Although rates ranged from 8 to 80 cents per hundredweight, 78.8 percent of the 

 producers paid from 23.4 to 46.5 cents or 3^ to 1 cent per quart. In the group, 

 34.9 percent of the producers paid from 30.1 to 35.0 cents per hundredweight or 

 approximately % cent per quart. The proportion of producers who paid more 

 than 35 cents per hundredweight, 15.2 percent, was relatively low. Twenty- 

 two difi^erent rates''' were effective for this group. 



Six of the 40 dealers regularly used more than one truck or carrier in collecting 

 their supplies. (Table 10.) These handlers made purchases from 491 farmers; 

 accounted for 30 of the routes; and altogether used 17 different rates in figuring 

 cartage charges. On 12 out of the 30 routes, a rate of 25 cents per hundredweight 

 was effective; on 10 of them a rate of 30 cents per hundredweight was used. The 

 number of rates applied per route ranged from one to five. Most of the routes 

 had only one or two rates in effect. Only four of the routes used five rates. The 

 distribution is shown in table 11. 



i^Due to absence of one criterion of a competitive maiket; that is, all sellers are not equally in- 

 formed about conditions in the market. 

 "Whole numbers. 



