June, 1941] Local Structure of Milk Prices 5 



niation of value to those concerned with the determination of milk prices 

 and allowances. It attempts to provide a better basis than now exists for 

 making decisions on price policy in New Hampshire milk markets. 



After sketching briefly the historical background of milk prices in 

 New Hampshire, the study shows that, under present conditions, in a 

 typical market, prices are not derived from any scientific basis and are 

 certainl)' not those prices which perfectly competitive conditions would 

 bring about. 



Likewise, when markets throughout the state are considered, prices 

 are found to vary much more ^\■idely than any difference in transporta- 

 tion costs would justify. 



The last part of the study investigates the market response of pro- 

 ducers in two areas, to varymg prices for milk. As might be inferred 

 from earlier findings, the response of producers to large price differen- 

 tials tended to be either retarded or overshadowed by the action of other 

 factors. 



In the first study of this series^ a description of the characteristics and 

 relationships of the supply areas furnishing milk, both to New Hampshire 

 markets and the Boston market, ^^ as given. In this preliminary publica- 

 tion, price data did not appear. In addition to locating the farms produc- 

 ing milk for sale and indicating the markets in which that milk was sold, 

 a description of the total sales in the various markets and the importance 

 of different types of distributive agencies was given. The extent of the 

 various milksheds was indicated, and the relationship of one market to 

 another was presented in both tabular and graphic form. In this first pub- 

 lication prices were not considered. 



The second publication of the series" described the manner in which 

 milk moves to the market from the areas of supply reported on in the first 

 publication. This study was limited to a consideration of the trucking of 

 milk from the farm to the country station or city plant. Particular em- 

 phasis was laid upon the charges levied upon the milk, as these are com- 

 monly deducted from the farmer's check. In this study, prices obtained 

 for milk at the market or paid to the farmer were not considered, and at- 

 tention was centered solely upon the trucking charges. In addition to 

 analyzing present rates charged, a theoretical analysis of the process of 

 rate formation was included and present charges were considered from 

 that standpoint. 



The third publication' also dealt with milk transportation, emphasiz- 

 ing what might be termed the physical process of assembling milk from 

 farms to plants, as contrasted to the preceding study which had to do with 

 charges levied on this milk. Several schemes of reorganization were 

 worked out for the south central part of the state. 



THE PROBLEM 



Despite widespread efforts by regulative agencies, cooperatives, 



^ MacLeod, Alan, 'The Milksheds of New Hampshire," N. H. Agri. Exp. Sta. Bui. 295, 1937. 



" ISIacLeod, Alan and Geraghty, Mary L., "The Transportation of New Hampshire Milk; I. Analy- 

 sis of Trucking Charges," N. H. Agri. Exp. Sta. Bui. 307, 1938. 



3 MacLeod, Alan, "The Transportation of New Hampshire Milk; II. Reorganization of Truck 

 Routes," N. H. Agri. Exp. Sta. Bui. 325, June 1940. 



