The Distribution of Gains from Investments in the Australian Apple Industry: Projections Using an Equilibrium Displacement Model

Abstract

<p>The Australian apple industry is one of the nation’s largest fruit industries with apples consumed in almost every household. To assist in industry development, levies are paid by producers on processing and fresh apples with funds directed towards research, development and marketing. While specific chain actors contribute to these developments, it is important to identify the beneficiaries to ensure the costs associated with the levies are allocated to those who will benefit. Within a framework depicting the Australian apple value chain, an equilibrium displacement model illustrates the distribution of surplus changes resulting from specified research, development and marketing actions. The distribution of surplus change shares indicates where the costs would be appropriately directed and the total impact to the value chain. It is evident that relatively small changes within the chain have the potential to induce significant increases to the values received by chain participants.</p>