Impact of biofuel policies on livestock production in the United States

This study was conducted to analyze the direct and indirect effects of ethanol policy on livestock production. Results of the theoretical and empirical model indicate the possibility of ethanol policy affecting livestock production in the United States both directly and indirectly, via the impact of the changes in the Renewable Fuel Standards on corn prices and production. Policy makers can utilize the information provided in this study to understand the effects of ethanol policy on multiple agricultural markets. Understanding the existence of indirect and direct effects of newly designed policies on non‐targeted markets adds credibility to the policy making process.