corporate conservatism and relative compensation this paper demonstrates that in a simple setting with managerial concern for reputation and asymmetric information on ability most managers may refrain from undertaking innovations that stochastically dominate an industry standard common components of uncertainty lead to market inferences of managerial ability based on relative performance managers who undertake the industry standard are consequently evaluated with a more accurate benchmark than those innovating discontinuities in compensation when performance is low because of firings lead managers to have differing valuations of an accurate benchmark depending on type in particular very high and very low ability managers are more likely to undertake superior innovations than those of average ability

sense and sustainability revisited the limits of total factor productivity measures of sustainable agricultural systems many economists have advocated and applied total social factor productivity tsfp i e total factor productivity estimated with both market and non market inputs and externalities and with all factors valued at social prices as a single all embracing measure of agricultural sustainability this paper reviews the conceptual and practical issues in measuring tsfp and shows that no one measure alone will be theoretically or empirically robust as an indicator of sustainability tsfp is a conceptually flawed measure since inclusion of non market inputs and outputs and social price based valuation in most cases violates the theoretical basis underlying those estimates trends in tsfp also have limited value in diagnosing the nature of sustainability problems unless changes in productivity are related to underlying changes in technology human and physical infrastructure and indicators of resource quality more attention needs to be given to defining key indicators of agro ecosystem health and relating these measures to trends in productivity this analysis must be sufficiently disaggregated and for a long enough time period to allow for spatial and temporal variability inherent in agricultural production secondary data at the district level on both conventional inputs and outputs and resource quality have recently allowed more quantitative estimates of sustainability and its causes with limited data yield growth decomposition analysis can often be used to provide valuable insights into sustainability problems meanwhile there is a need to invest in long term experimental and panel surveys of farmers and their fields for key production systems in order to provide long term data that will allow full productivity accounting using more formal statistical procedures regardless of the approach selected the findings of this paper strongly suggest a need for economists agronomists and soil scientists to collaborate in integrating approaches in order to provide more robust and informative measures of sustainability

old problems in the new solutions politically motivated allocation of program benefits and the new fertilizer subsidies summary fertilizer subsidies have been reinstituted in many african countries with innovations seeking to avoid the downsides of past programs the new subsidy paradigm however does not address how to curtail political manipulation which exacerbated inefficiencies of previous programs this paper analyzes whether politics affected voucher allocations in ghana s 2008 fertilizer subsidy program we find that more vouchers were targeted to districts that the ruling party had lost in the previous presidential elections and more so in districts that had been lost by a higher percentage margin this evidence shows that a significant threat to the efficiency of fertilizer subsidies remains

natural and environmental amenities a review of definitions measures and issues abstract this study investigates the notions of natural and environmental amenities in the social science literature the ways they are defined and measured and related issues we analyze 328 peer reviewed articles published over a 40 year period 1974 2013 we observe an exponential growth in publications with a small set of economics journals publishing most of the corpus despite this body of work there are still no widely acknowledged definitions of these notions research objectives have changed from an initial focus on recovering the implicit prices of natural environmental amenities to a more recent and growing interest in evaluating their impacts on regional development and quality of life regarding measurement most papers use unidimensional measures of natural attributes esp water bodies land cover use this survey leads to a discussion of prospects for future research

how endowments accumulations and choice determine the geography of agricultural productivity in ecuador spatial disparity in incomes and productivity is apparent across and within countries most studies of the determinants of such differences focus on cross country comparisons or location choice among firms less studied are the large differences in agricultural productivity within countries related to concentrations of rural poverty for policy understanding the determinants of this geography of agricultural productivity is important because strategies to reduce poverty often feature components designed to boost regional agricultural incomes census and endowment data for ecuador are used to estimate a model of endogenous technology choice to explain large regional differences in agricultural output and factor productivity a composite error estimation technique is used to separate systemic determinants from idiosyncratic differences simulations are employed to explore policy avenues the findings suggest a differentiation between the types of policies that promote growth in agriculture generally and those that are more likely to assist the rural poor

changing one s mind when the facts change incentives of experts and the design of reporting protocols experts often collect and report information over time what reporting protocol elicits the most information here a principal receives reports sequentially from an agent with privately known ability who observes two signals about the state of the world the signals differ in initial quality and unlike previous work differ in quality improvement the paper finds that mind changes inconsistent reports can signal talent if a smart agent improves faster also sequential reports dominate when the principal s decision is very sensitive to information a single report dominates if the mediocre agent s signals improve faster or the agent is likely mediocre

on the bad reputation of reputational concerns can reputational concerns do any good economists have shown how they lead agents to ignore valuable information to herd and to become overly risk averse we explore how they may be a social blessing an agent may exert effort to become informed about the uncertain benefits of a project a smart agent s efforts make him better informed a dumb agent s efforts are to no avail if an agent does not know his type reputational concerns are socially beneficial if an agent knows his type reputational concerns may be socially beneficial a dumb agent takes inefficient unconventional decisions to mimic a smart agent the latter exerts more effort in order not to be mistaken for a dumb this holds whether or not project rejection is a safe haven for the dumb

anti herding and strategic consultation in this paper i analyze how careerist decision makers aggregate and use information provided by others i find that decision makers who are motivated by reputation concerns tend to anti herding i e they excessively contradict public information such as the prior or others recommendations i also find that some decision makers may deliberately act unilaterally and not consult advisers although advice is costless moreover advisers to the decision maker may not report their information truthfully even if the advisers care only about the outcome they bias their recommendation since they anticipate inefficient anti herding behavior by the decision maker

economic efficiency and ecological considerations in resource development policies a case study abstract this case study of the formation of a forest policy for bangladesh incorporates many of the issues faced by developing countries in their search for natural resource policies that strike a balance between urgent needs for immediate material benefits and the long term necessity of utilizing and conserving natural resources in an ecologically sound manner the forest resources of bangladesh are under extreme pressure from illicit timber cutting and encroachment by agriculture through clearfelling and burning and overgrazing the study seeks to develop a forest policy that balances economic efficiency and forest management practices based on ecological principles ricardian type supply schedules are developed by ranking alternative site quality biological treatment combinations according to unit cost of production and comparing them with an econometrically derived long term demand schedule the optimal level of resource development is determined by equating marginal cost of production in end value terms with the projected long term forest products price level this is equivalent to maximizing the sum of consumer and producer surpluses commonly referred to as net economic benefits the study predicts a three fold increase relative to present levels in bangladesh timber output this can be achieved using 15 less of the present timberland base thereby releasing some one million acres of less productive hill forest areas this surplus land can then be allocated to non timber uses to meet conservation goals the proposed policy stresses participation by local communities and the growing of diverse species on private woodlots this is expected to increase the forest resource base of the country thus reducing the economic cost of timber production and improving environmental quality at the same time

the aaea ever growing and changing research challenges the changing economic conditions over the past century along with changes in technology and developments in economic theory and quantitative methods helped shape the profession we currently refer to as agricultural and applied economics the broadening of the profession from the original focus on the farm and agricultural industry to encompass international affairs governmental policies resources and environmental and rural affairs is discussed within this context emergence of the subdisciplines and some of the major individual contributions are noted the final section argues that members of the profession are well positioned to continue contributing research that will help society achieve its goals and notes six challenges that provide such opportunities

on nonparametric supply response analysis in this paper we explore the usefulness of nonparametric methods in the investigation of production behavior and the estimation of price elasticities of output supply and input demand functions the approach can handle the situation where some data points are not consistent with production theory the method is illustrated by estimating supply demand elasticities of outputs and inputs in u s agriculture

a theory of credibility this paper presents models in which one agent must decide whether to trust another whose motives are uncertain reliability can only be communicated through actions in this context it pays for people to build a reputation based on reliable behaviour someone becomes credible by consistently providing accurate and valuable information or by performing useful services the theory provides a justification for long term arrangements without binding contracts it also describes those situations where it pays an agent to cash in on his reputation many decisions depend on trusting someone consumers must decide whether to believe advertisements banks need to judge the reliability of loan applicants and employers must decide how much responsibility to delegate to their employees this paper attempts to model situations that arise when someone is uncertain about whether to trust the people he deals with in this context reputations for reliability are valuable an agent becomes credible by consistently providing accurate valuable information or by always acting responsibly i analyse a series of simple abstract models of information transmission in the basic model there are two agents the sender s and the receiver r who are to play the game a known finite number of times at each stage both players learn the value of a parameter measuring the importance of that period s play of the game that is the value of making a correct decision and s obtains payoff relevant information s then sends a signal to r who makes a decision that affects the welfare of both players after both players learn the consequences of r s decision the process repeats at each stage r must decide what action to take in order to do that he must assess the credibility of s the difficulty arises because r is uncertain about s s preferences when play begins i model this by assuming that with positive probability s has identical preferences to r s is a friend and with positive probability s has completely opposed preferences to r s is an enemy this uncertainty creates a trade off for enemy senders at each stage providing honest information enhances s s reputation but only at the expense of foregoing an opportunity for immediate gain by duping r the possibility that s is a friend lends credibility to what he says but this credibility may also be exploited by an enemy s the principal equilibrium has the following form in the basic model where s has no control over the importance of a given play s typically conveys accurate information for the first several periods r raises the probability he places on s being friendly after receiving accurate information if he believes that an enemy would have lied to him with positive probability the more important the information the more likely an enemy will attempt to deceive r an enemy will eventually take advantage of r by misleading him when this happens the sender loses all opportunities for deception in the future i

valuing local environmental amenity with discrete choice experiments spatial scope sensitivity and heterogeneous marginal utility of income using discrete choice experiments we examine preferences for the spatial provision of local environmental improvements in the context of regeneration policies amenities we consider are improvements to areas of open space recreation facilities and other public spaces street cleanliness restoration of derelict properties and the provision of paths dedicated to cycling and walking we include the spatial scope of the policy as an attribute making the trade off between environmental amenity and its spatial provision explicit we employ a novel estimator for average willingness to pay wtp for mixed logit models with a random cost coefficient which is robust to the presence of price insensitive respondents and performs well relative to mixed logit estimation in wtp space we find that the spatial scope of the policy affects both the intensity and heterogeneity of preferences and that these effects are of statistical and economic significance

intergenerational transfers and the social discount rate this paper investigates the relationship between intergenerational asset transfers and the choice of the discount rate for use in cost benefit analysis in a model of a competitive overlapping generations economy constrained by a socially managed exhaustible resource provided that there are no distortions in capital markets and that all agents hold perfect foresight cost benefit techniques will result in a pareto efficient resource allocation if the discount rate is set equal to the market rate of interest but since the path of the interest rate depends on the level of intergenerational transfers cost benefit techniques do not ensure a socially desirable distribution of welfare between generations a social optimum will result only if intergenerational transfers are properly chosen and enforced decentralized private altruism may result in intergenerational transfers that both present and future individuals would agree are too small if members of the present generation attach positive weight to the general welfare of future generations not simply their personal descendants in a world where intergenerational transfers are non optimal second best policy making may imply a constrained optimum that is inefficient together these findings suggest that cost benefit analysis is at best a partial criterion to policy formulation that should be used only in conjunction with ethical principles that define the proper distribution of welfare between present and future generations

natural resource economics and conservation contributions of agricultural economics and agricultural economists research by agricultural economists on natural resources has been distinguished by an interdisciplinary emphasis and a dynamic perspective it has recognized technological and institutional constraints has been oriented toward solving concrete resource management and policy problems and has emphasized empirical and quantitative analysis agricultural economists have introduced methods for evaluating natural resource conservation efforts for predicting adoption of resource conservation technologies and for designing efficient and sustainable resource management policies they have identified ways of improving land management and preventing land degradation proposed reforms of institutions governing water allocation and water quality and introduced policies for balancing environmental and efficiency considerations in the management of pests biodiversity and livestock diseases their research has had substantial impacts on the formulation of resource conservation policies

strategies for sustainable development of less favored areas discussion development based on indicators of change in the natural capital stock alone such as the indicators used by kerr and by pgb e this constrained maximization problem for sustainable development leads to two linked objectives increase in wealth and maintenance of the capital stock especially the natural capital stock returning to our metaphor the elephant must enjoy feeding without trampling and overgrazing the bush through this elephantine lens on sustainable development the disparate research questions of the three articles fit into view fan and hazell explicitly look at changes over time addressing the wealth maximization objective of the sd problem at the district scale within two huge countries they find that agricultural investment in the less favored areas leads not only to higher marginal rates of return but also to sharper declines in poverty incidence they speculate scott m swinton is associate professor in the department of agricultural economics at michigan state university this article was presented in a principal paper session at the aaea annual meeting chicago il august 2001 the articles in these sessions are not subjected to the journal s standard refereeing process

decision making in committees transparency reputation and voting rules in this paper i analyze the effect of the transparency of the decision making process in committees on the decisions that are eventually taken i focus on committees whose members are motivated by career concerns so that each member tries to enhance his own reputation when the decision making process is secretive the individual votes of the committee members are not exposed to the public but only the final decision thus individuals are evaluated according to the group s decision i find that in such a case group members are induced to comply with preexisting biases for example if the voting rule demands a supermajority to accept a reform individuals vote more often against reforms and exacerbate the conservatism of the voting rule when the decision making process becomes transparent and individual votes are observed this effect disappears and such committees are then more likely to accept reforms i also find that coupled with the right voting rule a secretive procedure may induce better decisions than a transparent one

labor productivity measurement in japanese agriculture 1956 1990 abstract this paper investigates the factors responsible for a drastic decline in the growth rate of labor productivity of the agricultural sector for the 1956 1990 period this investigation is carried out by a newly devised procedure which decomposes the growth rate of labor productivity into 1 the total substitution effect which consists of the effects due to factor price changes and biased technological change and 2 the tfp effect composed of the effects due to scale economies and technological progress based on empirical estimation of the translog cost function it was found that the total substitution effect contributed to the growth of labor productivity much more than the tfp effect did for the period under question

sustainable development challenges to profession of agricultural economics fundamentally sustainable development is a notion of discipline disciplining our current consumption this sense of intergenerational responsibility is a new political principle a virtue that must now guide economic growth the industrial world has already used so much of the planet s ecological capital that the sustainability of future life is in doubt that can t continue brundtland page 5

a model of expertise we study a model in which perfectly informed experts offer advice to a decision maker whose actions affect the welfare of all experts are biased and thus may wish to pull the decision maker in different directions and to different degrees when the decision maker consults only a single expert the expert withholds substantial information from the decision maker we ask whether this situation is improved by having the decision maker sequentially consult two experts we first show that there is no perfect bayesian equilibrium in which full revelation occurs when both experts are biased in the same direction it is never beneficial to consult both in contrast when experts are biased in opposite directions it is always beneficial to consult both indeed in this case full revelation may be induced in an extended debate by introducing the possibility of rebuttal

reliability and predictive validity of contingent values does the nature of the good matter abstract because the contingent valuation mechanism cvm elicits verbal reports of maximum willingness to pay and not actual willingness to pay analysts have expressed doubts about the reliability and validity of contingent values for commodities such as environmental amenities this skepticism is usually attributed to the amorphous nature of the commodity and to peoples lack of familiarity or experience however our comparison of two commodities which lie at polar extremes of the private good public good continuum suggests that the nature of the good may have little influence on the reliability and predictive validity of the cvm instead aspects of the cvm itself e g explicit payment obligation may be more important for high intention behavior consistency

managerial incentive problems a dynamic perspective the paper studies how a person s concern for a future career may influence his or her incentives to put in effort or make decisions on the job in the model the person s productive abilities are revealed over time through observations of performance there are no explicit output contingent contracts but since the wage in each period is based on expected output and expected output depends on assessed ability an implicit contract links today s performance to future wages an incentive problem arises from the person s ability and desire to influence the learning process and therefore the wage process by taking unobserved actions that affect today s performance the fundamental incongruity in preferences is between the individual s concern for human capital returns and the firm s concern for financial returns the two need be only weakly related it is shown that career motives can be beneficial as well as detrimental depending on how well the two kinds of capital returns are aligned it is well understood by now that informational externalities may place special demands on the organization of economic exchange simple price mediated markets will frequently fail in the presence of asymmetric information in that case more elaborate contractual arrangements have to be used as substitutes for the price system lately considerable effort has been devoted to the analysis of contracting under incomplete information with the objective to understand the range of economic institutions that emerge in response to the failure of the price system the analysis of moral hazard has played a prominent role in this development moral hazard problems arise when for some reason or another transacting parties cannot contract contingent on the delivery of the good for instance in buying labour services it may be that the amount of labour supplied is not directly observable precluding a simple exchange of wage for labour as a partial remedy to this problem an imperfect mutually observed signal about the supply of labour can be used as a proxy in the contract frequently output is taken as such a proxy the drawback is that output is often influenced by other factors than labour input which induce undesirable risk into the contract one is therefore faced with a tradeoff between allocating risk associated with incomplete observability and providing incentives for a proper supply of labour gaining insight into this tradeoff is important not only for understanding contracting in the small e g managerial incentive schemes but also because it is closely related to the fundamental tension between equity and efficiency in the society as a whole while our understanding of moral hazard has advanced a lot in past years it is clear that much work remains an important question that has received little attention until

post war productivity patterns in u s agriculture influences of aggregation procedures in a state level analysis annual data for forty eight states are used to account for changes in the composition of input and output aggregates over space and time and thereby to obtain new evidence on changes in inputs outputs and productivity in u s agriculture the measures change significantly when we use state specific rather than national prices and when we allow for changes in the composition of the aggregates especially of labor and capital inputs we compare our estimates and those reported by ball et al american journal of agricultural economics 81 1999 164 79 the national estimates are similar but substantial differences are found in state level productivity growth

benchmarking the sustainability performance of the brazilian non gm and gm soybean meal chains an indicator based approach abstract a commonly accepted approach for measuring the sustainability of agricultural products is the first step toward treating traded products differentially according to their sustainability if we were able to measure sustainability business stakeholders could optimize food production chains consumers could demand products based on reduced environmental and social impacts and policy makers could intervene to meet the growing demand for food in a context of environmental conservation population growth and globalization we proposed to measure profit adjusted for the negative externalities of production as a promising single metric for benchmarking products in terms of their relative sustainability the adjusted profit differences between different products are then assessed by means of the bennet total factor productivity tfp indicator and the total price recovery tpr indicator to highlight areas for potential sustainability improvement to illustrate the usefulness of the indicator based approach we assessed the relative sustainability of two brazilian conventional soybean meal chains non genetically modified non gm and genetically modified gm chains based on the results we indicated potential areas for sustainability improvement sustainability issues included in the assessment were profitability global warming potential eutrophication potential environmental toxicity farmworker toxicity consumer toxicity deforestation and loss of employment results showed that the non gm soybean meal chain is more sustainable than the gm chain higher adjusted profit due to higher tfp and favorable prices especially for outputs however both chains require joint efforts to address their economic environmental and social deficiencies these efforts should focus on providing technical and high quality assistance to reduce biocide use and improving transportation the analysis in this study could be extended by undertaking a comparative assessment of the sustainability performance of major soybean meal producers i e united states argentina china and brazil the approach proved to be a promising benchmarking tool for agricultural trade flows it allows an integrated assessment of the dimensions of sustainability along food chains that is sufficiently flexible to compare the sustainability level of various biomass stocks that are produced in different locations and in a variety of environmental and socio economic contexts nevertheless it requires consensus on which components of sustainability are to be assessed

sense and sustainability sustainability as an objective in international agricultural research abstract this paper first discusses how to use sustainability as a criterion by which to evaluate agricultural research then illustrates the difficulties inherent in applying the criterion and finally draws implications for international agricultural research seven propositions relating to sustainability are stated agricultural researchers are urged to a recognize the importance of the sustainability of agricultural systems b devise appropriate ways to measure sustainability c empirically examine the sustainability of some well defined cropping or farming systems d define the externalities that exist in such systems and e develop methods to measure those externalities

production costs and input substitution in zimbabwe s smallholder agriculture abstract in this study we estimate production costs and elasticities of factor substitution for zimbabwean smallholders using a dual cost function approach with detailed data on prices paid and received by each of 65 farms across six survey sites over two years we find that 95 of observed farm choices are consistent with optimal input use and that there is moderate substitutability between labor biochemical inputs and capital these results indicate that farmers can substitute between factors as relative prices change particularly to increase labor use as the rural population grows by stratifying our sample we investigate the degree to which production costs differ among the socioeconomic groups tsting for higher costs among female headed households who might be subject to gender discrimination resource poor farmers without their own draft animals who might have less timely operations and isolated farms far from paved roads who might have less access to markets and information we find significant support only for the paved roads effect indicating the importance of rural infrastructure in determining production costs

variations on invariance or some unpleasant nonparametric arithmetic the nonparametric approach to production or demand analysis involves testing data for compatibility with restrictions from theory this avoids reliance on particular functional forms when the data are not consistent with utility or profit maximization adjustments in the data using linear programming can restore consistency such adjustments have been interpreted as taste changes or measures of technical change and technical change bias this paper describes nonparametric approaches and shows that the programming methods that have been used yield results that are not invariant to the scaling of prices and quantities a solution is proposed that solves the invariance problem

lessons for the world from us agriculture unbundling technology abstract take as a goal the adequate nourishment of all human beings by the middle of the next century when the human population will be near double its 1980 level with much of the increase occurring in the poorest areas of the world there is a great need to keep food prices low however we must consider the additional goal of sustainability can agricultural sustainability be achieved while producing the required volume of food at low cost this paper will argue that economic development does not require that food be as cheap or agricultural practices be as labor saving as is often assumed

research and extension expenditures and productivity in japanese agriculture 1960 1990 abstract this paper investigates the cause for the decline in the growth of productivity in japanese agriculture since the late 1960s for this objective it investigates the effects of research and extension r e activities on the extent and the direction of the bias of technological change in japanese agriculture for the period 1960 1990 based on the translog cost function framework empirical results show that the cost reducing effects of r e measured in terms of the absolute value of the cost r e elasticity increased slightly from 0 194 in 1960 to 0 205 in 1965 and then decreased consistently to 0 110 in 1990 this finding is broadly consistent with the finding of the decline or slowdown in agricultural productivity since the late 1960s the bias due to r e was found to be toward labor intermediate inputs and other inputs saving on the one hand and machinery and land using on the other labor saving and machinery using biases are consistent with the hicksian induced innovation hypothesis

measuring heterogeneous preferences for preserving farmland and open space abstract public preferences for environmental policies often vary among individual citizens according to their socio economic characteristics and attitudes toward environmental programs most researchers account for socio economic characteristics when conducting public preference surveys but do not account for differences in preferences that transcend socio economic categories identifying the public s attitudes regarding environmental programs and the role they play in shaping individuals preferences for policy alternatives can assist policy makers in developing programs that are consistent with public expectations this paper uses factor analysis and a discrete choice model to describe differences in public preferences that result from different attitudes regarding the goals of programs designed to preserve farmland and open space results describe policy implications that are not apparent when using models that address socio economic characteristics alone

on agricultural sustainability and its measurement in small scale farming in sub saharan africa abstract we argue in this paper that there is a need to bring the current debate on sustainability down to a more pragmatic level to operationalise sustainability given the diversity of agricultural systems throughout the world the best that is possible may be to develop proximate definitions that do generate testable theories as we try to do in this paper by developing a pragmatic and measurable definition of the concept which is relevant to small scale farming in sub saharan africa the definition we offer takes the community of the village agroecosystem as a relevant and embracing social and spatial unit of analysis it is based on the anthropocentric value judgement that future generations must have the same range of options concerning the use of agroecosystems as the current generation given that village agroecosystems generate various environmental amenities for the human communities this value judgement means that a sustainable agroecosystem is one which has the capacity to respond to exogenous change as well as to internal disruptions by maintaining non declining trends in its resources and amenities over a period of at least one decade the approach we advocate has the dual dangers of over simplification and the creation of tautologies it should always be borne in mind that the criteria of sustainability may differ from ecosystem to ecosystem zone to zone nation to nation each situation should be scrutinised for the essential criteria for assessment which may be different and greater or lesser in number than those we have proposed as a generality we do maintain however that for progress in sustainability assessment this process of choice should be based on the principle of parsimony tautology the erection of self fulfilling predictions is a more fundamental danger in the approach we have taken we have emphasised several times the necessity of rigorous testing of hypotheses concerning the determinants of each of the components of sustainability that we have described this is the real challenge to the researcher but insight into the design of appropiate experiments may be gained from preliminary application of pragmatic tests of relative sustainability of the type described here we try to avoid ecological and economic dogma as far as possible in our discussion of sustainability attempting to argue instead from what we actually observe in the systems we study whilst a great deal of ecological and economic theory may seem at first look to be applicable to the analysis of the sustainability of small scale agricultural systems we find that closer analysis reveals the inapplicability of much of what has been subsumed under the titles of agroecology or natural resource economics concepts such as stress and disturbance stability and diversity community structure economic optimality maximum social welfare do not on inspection provide particularly strong predictive power particularly when applied to the dynamics of resource poor small scale community structured and to a non negligible extent non market driven agricultural systems

did the green revolution concentrate incomes a quantitative study of research reports abstract a review of more than 300 studies on the green revolution published during 1970 1989 shows that about 80 of those studies which had conclusions on the distributional effects of the new technology found that inequality increased both interfarm and interregional this evidence diverges from the position of action agencies which support and participate in this technological strategy toward agricultural and rural development an evaluation of the studies using their results as data for a statistical analysis reveals that the authors conclusions on the question of whether income concentration increased depended on such structural and methodological characteristics as the regional origin of authors location of the study area methodology followed and the geographic extension of the study area for example studies done by western developed country authors those employing an essay approach and those looking at a multicountry region are most likely to conclude that income inequalities increased by contrast work done by asian origin authors with study areas located in india or the philippines and using the case method are more likely to conclude that increasing inequality is not associated with the new technology

u turns and full circles two decades of agricultural reform in malawi 1981 2000 abstract this paper traces the evolution of malawi s agricultural policy over the past two decades during this period the world bank has played a key role in shaping policy reform through its adjustment loans three distinct reform phases can be identified 1981 87 when policy was dominated by the dogmatism of the world bank s pricist and state minimalist policies 1988 94 when a more flexible position was taken by both the bank and the malawi government both of whom acknowledged the structuralist critique of earlier policies and 1994 to the present when the reform process in agriculture became more politicized and a schism developed between the bank and the government this latter period is used to illustrate some of the unresolved policy issues pertaining to similar low income agrarian economies

interpreting changes from the 1970s to the 1990s in african agriculture through village studies abstract assessments of the performance of agriculture in sub saharan africa are typically based on official production statistics at national level between the early 1970s and the mid 1990s these often show alarmingly poor rates of growth but there are good reasons to doubt the statistics and their interpretation an alternative is to examine the record from the village level upward this paper looks at the evidence from 26 case studies of change between the mid 1970s and the mid 1980s at the district or village level these suggest less cause for alarm than the national statistics they confirm that access to markets is essential for agricultural development the single biggest idea in the policy reforms of the 1980s but they also underline the importance of the detail of policy in remedying failures in product capital and insurance markets and in public investment in technology

environmental economics an evolutionary critique and a plea for pluralism abstract environmental economics is a contradiction in terms the contradiction is intuitive to the puzzled lay person inquiring about the nature of our subdiscipline it is explicit to those who think of environmental systems in terms of complex evolving interconnectedness and identify the economic model with the atomistic and mechanistic assumptions of classical mechanics within the subdiscipline we try to resolve the contradiction by internalizing externalities by matching market feedbacks with environmental relations while acknowledging that insights can be drawn from the market view of environmental problems i argue in this essay that 1 the contradiction is nerver resolved 2 multiple incongruous perspectives are all we have for understanding the interface between economic and environmental systems and 3 environmental economics will thrive with a return to philosophical pluralism to the open acceptance of the contradiction

intergenerational competitive equilibria under technological uncertainty and an exhaustible resource constraint abstract this paper presents a model of competitive intertemporal equilibrium in a finite horizon overlapping generations economy facing technological uncertainty and an exhaustible resource constraint individuals form rational expectations regarding future prices and economic conditions and income is redistributed from one generation to the next through government mandated lump sum transfers under uncertainty the relationship between resource price appreciation and the interest rate is mediated by consumers risk aversion with respect to consumption in alternative states of nature the intuitively appealing proposition that the expected resource price rises at the expected rate of interest holds only as a special case if future generations are taken to be state contingent in the sense that their composition depends on the states of nature prevailing when they are born then equilibria are generally pareto efficient but if future generations are state independent so that the set of individuals born at a given date is independent of the prevailing state of nature then equilibria may be inefficient because markets do not exist where successive generations may equilibrate their marginal rates of substitution across consumption in alternative contingent states such inefficiencies may be remedied through the implementation of appropriate intergenerational transfers an optimal intergenerational welfare distribution may be supported as a competitive equilibrium if the income transfer regime is properly selected and enforced the social optima that result for a simple version of the model under the maximin welfare criterion indicate that greater sacrifices are required on the part of the present generation when future generations are taken to be state contingent than when they are regarded as state independent this finding provides a possible explanation for the extreme risk aversion of conservationists with respect to the welfare of future generations

low input agriculture trends goals and prospects for input use low input agriculture lia has reemerged as an issue of the day it was last a topical issue during the 1970s energy crisis when the focus was on reducing our reliance on petroleumbased inputs klepper et al lia s current popularity is similarly motivated but supported by growing evidence of environmental and health risks from agrichemicals the drop in commodity prices and farm equity value which occurred between 1981 87 has rekindled interest in developing cost reducing technologies accumulated evidence on groundwater quality effects of nitrogen fertilizer and pesticides nielsen and lee has triggered numerous state and federal proposals and administrative actions with respect to agrichemicals and the environment concerns about costs of production and environmental effects are formalized in a recent u s department of agriculture usda statement which supports research and education on alternative farming systems that decrease or optimize the use of purchased inputs and that can increase net cash returns through decreased costs of production and may effectively improve the competitive position of the farmer and decrease the potential for adverse environmental impacts usda we question whether widespread employment of systems that concurrently meet these multiple objectives can occur under existing technology farm policy and economic conditions our argument rests on two basic assumptions profit maximization is a strong motivation for production decisions and externality issues are the driving force for public ncouragement of intervention to selectively reduce purchased input use we hypothesize that current high demand for agrichemicals coincides with profit maximizing levels of input use to the extent that empirical evidence supports this hypothesis the real debate involves the forms of intervention available to internalize externalities

valuation and management of tropical forests implications of uncertainty and irreversibility this paper develops a framework for the valuation and management of tropical forests that reflects their ecological and economic characteristics the analysis demonstrates the importance of modeling the feasible use patterns and the information structure in tropical forest management decisions the model predicts that cases exist where the foresighted management of forests leads to more preservation than the traditional expected value approach an application in thailand provides evidence that such cases occur in relevant ranges of benefit flows the model focuses tropical forest management on assessments of sustainability and feasible sequences in light of uncertainty and information flows

constraints on the design of sustainable systems of agricultural production abstract in this paper i review the evolution of the sustainability concept this is followed by a description of three classical systems of sustainable agriculture none of these systems were or are capable of generating growth of output consistent with modern rates of growth in demand i then turn to three unresolved analytical issues that continue to divide the conventional resource economics and the sustainable development communities in a closing section i argue sustainable growth in agricultural production should be viewed as a research agenda rather than as a package of practices that is available to producers whether in developed or developing countries

effects of tractor ownership on returns to scale in agriculture evidence from maize in ghana abstract agricultural transformation process around the world has often accompanied the rise in returns to scale rts while tractor ownership is often associated with greater rts in agriculture whether the tractor ownership actually causes such increase in rts has not been formally tested in the literature we bridge this knowledge gap using a unique survey data of tractor owning farm households in ghana we find that owning tractors significantly increases the rts in maize production on the households largest mono cropped plot and weakens inverse relationship between land productivity and farm size this is partly achieved through the rise in the rts in tillage production the amount of tillage conducted rather than the rts in maize production given a fixed amount of tillage produced these sets of evidence are obtained by addressing jointly the multiple sources of endogeneity of tractor ownership tractor values tillage production and other inputs used

zimbabwe s maize based green revolution preconditions for replication abstract the green revolution was launched in 1960 in zimbabwe five years before it got underway in india since zimbabwe s green revolution was spearheaded by white commercial farmers however it was ignored by africa s new leaders in the 1960s as they experimented with state farms from moscow communal farms from china and land settlement schemes from israel at zimbabwe s independence in 1980 the new majority ruled government introduced a number of programs to help smallholders increase food and cash crop production drawing on a backlog of hybrid maize varieties expanded access to credit higher guaranteed government maize prices and marketing subsidies smallholders doubled maize production during 1980 1986 zimbabwe s maize based green revolution challenges those who allege that hybrid maize cannot compete with sorghum in low rainfall areas and that it is unsuitable for resource poor farmers because of the need to purchase new seed each year today virtually 100 of zimbabwe s maize area is under hybrids and short season hybrids are outcompeting other foodgrains in many low rainfall areas zimbabwe s biggest challenge is to develop cost effective marketing policies and institutions to sustain its maize based green revolution countries trying to replicate zimbabwe s success story should focus on fulfilling four interrelated preconditions political technological economic and institutional

total factor productivity growth in agriculture a malmquist index analysis of 93 countries 1980 2000 in this paper we examine levels and trends in agricultural output and productivity in 93 developed and developing countries that account for a major portion of the world population and agricultural output we make use of data drawn from the food and agriculture organization of the united nations and our study covers the period 1980 2000 due to the non availability of reliable input price data the study uses data envelopment analysis dea to derive malmquist productivity indexes the study examines trends in agricultural productivity over the period issues of catch up and convergence or in some cases possible divergence in productivity in agriculture are examined within a global framework the paper also derives the shadow prices and value shares that are implicit in the dea based malmquist productivity indices and examines the plausibility of their levels and trends over the study period

information aggregation in debate who should speak first abstract privately informed individuals speak openly in front of other members of a committee about the desirability of a public decision each individual wishes to appear well informed for any given order of speech committee members may herd by suppressing their true information with individuals of heterogeneous expertise optimizing over the order of speech can improve the extraction of information but not perfectly so it is not always optimal to use the common anti seniority rule whereby experts speak in order of increasing expertise a committee with more able experts may be afflicted by greater herding problems yielding a worse outcome

measuring the sustainability and economic viability of tropical farming systems a model from sub saharan africa abstract new technologies must be developed in sub saharan africa which are sustainable and economically viable this paper discusses a methodology for measuring the agricultural sustainability and economic viability of tropical farming systems for new technology evaluation the approach is based on the concept of interspatial and intertemporal total factor productivity paying particular attention to valuation of natural resource stock and flows agriculture is a sector which utilizes natural resources e g soil nutrients and the stock and flows of these resources affect the production environment however in many cases the stock of these resources is beyond the control of the farmer and must be accounted for in an agricultural sustainability and economic viability measurement for example soil nutrients are removed by crops erosion or leaching beyond the crop root zone or other processes such as volatilization of nitrogen agricultural production can also contribute to the stock of some nutrients by leguminous plants such as agroforestry systems using a data set available at the international institute of tropical agriculture we compute the intertemporal and interspatial total factor productivity indices for four cropping systems in southwestern nigeria using stock of major soil nutrients as the natural resource stock results show that the sustainability and economic viability measures are sensitive to changes in the stock and flow of soil nutrients as well as the material inputs and outputs where the contribution of natural resource stock and flows are important such as in the case of alley cropping the measures provide markedly different results from conventional tfp approaches the advantage of this approach is that interspatial and intertemporal total factor productivity measures are computed using only price and quantity data thus eliminating the need for econometric estimation

peasant household modelling farming systems evolution and sustainability in northern zambia chitemene slash and burn cultivation continues to be a dominating cropping system in northern zambia even after the introduction of modern technologies such as hybrid maize and fertilizer the rationale of farming systems evolution in northern zambia where labour markets have been absent or highly imperfect has been analyzed by goal programming based on the theories of chayanov 1966 and nakajima 1986 carrying capacity estimation is incorporated in the models and discussed in relation to the sustainability of land use systems in the area the major changes in agricultural technologies in northern zambia during this century has been the introduction of cassava maize and fertilizer technologies cassava has had the most significant impact since the land could support much higher population densities and since the dependence on the chitemene system no longer was critical for the survival of peasants by switching from finger millet to cassava as the main staple the peasants could reduce their total labour requirement to meet their basic food needs by as much as 40 the results also show that the maize fertilizer technology has been unable to replace the chitemene system because economic incentives to continue the system exist as long as there is suitable woodland available nevertheless the introduction of the maize fertilizer technology may have resulted in reduced chitemene cultivation the rapid expansion of maize production in northern zambia from the late 70s to the late 80s depended critically on the government policy of equity pricing and input subsidisation the models predicted that the removal of fertilizer subsidies would result in a dramatic reduction in maize production

principles of green accounting for renewable and nonrenewable energy resources investment in an energy project has several economic effects green accounting is a method of evaluating the effects attributable to nature and using the values for policy evaluation or to make net national product nnp a more comprehensive indicator of social welfare adjusting for the natural effects that are mediated in markets influences only the timing of amendments to nnp it has a transitory effect rather than the long run effect desired in green accounting the long run effect that green accounting can have is to recognize the values of nonpriced environmental amenities making them explicit inputs to decision making

on committees of experts a committee makes a decision on a project on behalf of the public members of the committee agree on the a priori value of the project and hold additional private information about its consequences they are experts who care about the value of the project and about being considered well informed before voting on the project members can exchange their private information simultaneously we show that reputational concerns make the a priori unconventional decision more attractive and lead committees to show a united front these results hold irrespective of whether information can be manipulated or not also reputational concerns induce members to manipulate information and vote strategically if their preferences differ considerably from those of the member casting the decisive vote our last result is that the optimal voting rule balances the quality of information exchange and the alignment of interests of the decisive voter with those of the public

long term evolution of productivity in a sample of philippine rice farms implications for sustainability and future research abstract we investigate long term productivity trends in a representative intensive rice cropping system using periodic farm level survey data spanning more than 20 years of the green revolution in two rice bowls of the philippines estimation of production functions with year dummy variables shows substantial declines in productivity from the early 1980s to the mid 1990s examination of secondary data shows however that the survey years were unrepresentative of long term trends and were unduly influenced by exogenous yield shocks correction for these effects removes the productivity decline but shows that productivity has stagnated a renewed emphasis on increasing crop genetic yield potential may be necessary in order to improve productivity and restore the contribution of this important farming system to poverty alleviation

when managers cover their posteriors making the decisions the market wants to see the stock market has opinions as to what choices firms should make we show that concern for current share prices may lead managers to make these choices rather than those suggested by their own superior information even when arbitrarily many privately informed firms have to make a similar decision the market s prejudices may still prevail we compare the distortions that arise from share price maximization with those due to herd behavior among profit maximizing firms and show that the former results in strictly less efficient use of information

the political economy of policies for smallholder agriculture summary as the experience of the 20th century has shown implementing policies that increase agricultural productivity among smallholders is a particularly promising strategy to achieve pro poor growth however history also reveals major political challenges to adopting this strategy the paper compares the experience of asian countries that were able to launch a smallholder based green revolution with the experience of african countries that are still struggling with this goal it then reviews the political economy literature to identify the factors that account for these divergent experiences finally the paper develops a conceptual framework to guide empirical research to close the knowledge gaps identified by the review

technical efficiency of alternative farming systems the case of greek organic and conventional olive growing farms abstract olive growing is a major farming activity in greek agriculture this paper analyzes empirically the technical efficiency of organic and conventional olive growing farms using a stochastic production frontier methodology and a translog functional specification findings indicate that the organic olive growing farms examined exhibit a higher degree of technical efficiency relative to their production frontier than do conventional olive growing farms reasons may include lower profit margins and restrictions on inputs permitted thus forcing organic farmers to be more cautious with input use however both input and output oriented technical efficiency scores are still relatively low for both types of olive farming thus there is considerable scope for cost reducing and farm income improvement in both farming modes this could prove crucial for the long run viability and the future course of the sector

a time of agric rethinking the failure of agricultural programs in 1970s ghana summary recent interest in a new green revolution in africa has revived debate about state intervention in agricultural markets and biotechnology these debates take for granted that the first wave of green revolution interventions in africa failed to influence small scale food farmers this essay uses oral historical and documentary evidence from ghana s northern region to revisit the evidentiary basis of this assessment tracing how the production of aggregate data and changing interpretive frameworks in the 1970s and 1980s allowed policymakers to ignore the experiences of farmers the essay advocates for the role of micro historical analysis in assessing africa s recent agricultural past

herding and anti herding a model of reputational differentiation abstract we analyze a model related to the strategic herding literature where a second expert maximizes his expected second period value by conforming with a first expert herding in contrast to the herding literature we assume that an agent is most valuable if he is the only smart agent if the value of being the only smart agent is sufficiently large the second expert always opposes its predecessor s report otherwise herding may result

consumer s surplus without apology the purpose of this paper is to settle the controversy surrounding consumer s surplus and by so doing to validate its use as a tool of welfare economics i will show that observed consumer s surplus can be rigorously utilized to estimate the unobservable compensating and equivalent variations the correct theoretical measures of the welfare impact of changes in prices and income on an individual i derive precise upper and lower bounds on the percentage errors of approximating the compensating and equivalent variations with consumer s surplus these bounds can be explicitly calculated from observable demand data and it is clear that in most applications the error of approximation will be very small in fact the error will often be overshadowed by the errors involved in estimating the demand curve the results in no way depend upon arguments about the constancy of the marginal utility of income consequently this paper supplies specific empirical criteria which can replace the apologetic caveats frequently employed by those who presently apply consumer s surplus moreover the results imply that consumer s surplus is usually a very good approximation to the appropriate welfare measures to preview below i establish the validity of these rules of thumb for a

modeling inter sectoral growth linkages an application to u s agriculture abstract general equilibrium and open economy trade theory are used along with time series data on the u s agricultural sector to provide insights into the structure of agricultural supply factor returns and linkages to the rest of the economy output expansion and factor returns are found to vary depending on relative factor intensities which we refer to as rybczynski and stolper samuelson like effects the effect of the rest of the economy particularly the increase in price of services is found to have relatively large negative impacts on agriculture the short run effects of prices and factor endowments on growth in agricultural supply and factor returns are dominated by the long run effects of technological change

landscape amenities and local development a review of migration regional economic and hedonic pricing studies abstract with rapid urban expansion and loss of open space attractive local landscapes will continue to gain importance in location decisions and on political agendas the present study reviews the evidence on the local economic role of landscape amenities from two major strands of empirical research migration and regional economic models and hedonic pricing models following common amenity definitions we identify 71 relevant peer reviewed studies and systematically assess the reported effects of the landscape amenity variables the migration and regional economic studies suggest that migrants are attracted by amenities nearly as often as by low taxes reported effects of amenities on income and employment are less consistent the hedonic studies suggest that nature reserves and land cover diversity have mostly open space and forest often and agricultural land rarely positive effects on housing prices studies at larger geographic scales and studies involving urban areas were more likely to identify significant amenity effects some limitations of the evidence may be overcome with better datasets and modeling approaches however in line with other recent work the limitations also highlight the need for complementary information from the analysis of political preferences for land use management

a nonparametric analysis of agricultural technology u s agricultural technology and technical change are analyzed nonparametrically under cost minimization and profit maximization based on annual data for 1948 83 various separability hypotheses concerning the aggregate production function for u s agriculture are investigated the proposed nonparametric approach also provides some insights into the nature of technical change

when second opinions hurt a model of expert advice under career concerns we augment the standard career concerns model by introducing i an action that blocks the information about the true state of the world and ii a second opinion interim news after the initial consultation with the expert in this model the principal s action as well as the expert s message endogenously determine the observability of the states and consequently the assessment of the expert s ability by the principal we show that having access to better interim news could reduce the welfare of the principal due to its strategic effect on the expert s recommendation we also discuss the implication of the results for possible delegation of decision making to another person with different decision parameters

false promise or false premise the experience of food and input market reform in eastern and southern africa abstract the literature on the effects of agricultural market reform in africa is sharply divided and inconsistent this article attempts to reconcile opposing viewpoints on the effects of food and input market policy reform in eastern and southern africa drawing from studies of ethiopia kenya malawi zambia and zimbabwe we argue that a major source of the controversy stems from assumptions that countries have actually moved to a liberalized market environment we find that many of the most fundamental elements of the reform programs either remain unimplemented were reversed within several years or were implemented in such a way as to negate private sector investment incentives a framework is developed for explaining why some countries have been able to liberalize their food and fertilizer markets while others have not these findings have implications for how donor assistance and policy oriented research can more constructively contribute to an improved policy environment

sustainability analysis of ecological and conventional agricultural systems in bangladesh summary this paper examines the sustainability of conventional and ecological agricultural systems based on their environmental soundness economic viability and social acceptability significant differences were found in crop diversification soil fertility management pests and diseases management and use of agrochemicals no remarkable variations were found in land use pattern crop yield and stability financial and economic returns risk and uncertainties or food security the findings suggest that ecological agriculture is relatively more sustainable and it could be an economically and environmentally viable alternative to the conventional agricultural system ecological agriculture could become an alternative if market distortions created by subsidies were removed and financial benefits were provided to resource conserving farmers along with necessary support through extension credit research and marketing 2003 elsevier ltd all rights reserved

the nature of agricultural systems food security and environmental balance abstract global food security in the future will depend on growth in production in those areas of the world with favourable soils adequate water resources and high yields from wheat and rice cropping because the area devoted to rice and wheat cultivation in these favourable conditions has been stagnant or declining since the 1980s with little prospect for reversing the trend increases in grain production must come from increases in yield per hectare to achieve the needed increases in yields of basic food grains a broad range of constraints facing existing production systems must be removed additional inputs for crop production are needed and new technologies which have yet to be developed are essential for managing crop nutrients pests and diseases under normal economic conditions optimal farm management of high intensity agriculture produces grain yields that approach 80 of the technical ceiling achieved on experimental plots as asian farmers approach this 80 limit pushing out the technical yield ceiling will be crucial for maintaining growth in cereal yields into the 21st century if management practices focus on short run profitability rather than on long run sustainability the challenge to scientists seeking to raise yield potential becomes more complex because of the deteriorating soil environment in which crops are grown most of the agricultural land in the developing world has less favourable endowments of soil and water resources than do the high productivity farming areas of asia these regions are home to the majority of the world s poor developments in production ecology suggest that significant improvement is possible in the management of biological processes that govern the efficiency and sustainability of the agricultural systems that dominate in these poorly endowed areas but a substantial investment in research for crop production will be required

the economic growth debate what some economists have learned but many have not one thing economists should have learned from the economic growth debate is the importance of defining the term growth by growth i mean quantitative increase in the scale of the physical dimensions of the economy i e the rate of flow of matter and energy through the economy from the environment as raw material and back to the environment as waste and the stock of human bodies and artifacts by development i mean the qualitative improvement in the structure design and composition of physical stocks and flows that result from greater knowledge both of technique and of purpose simply put growth is quantitative increase in physical dimensions development is qualitative improvement in non physical characteristics an economy can therefore develop without growing just as the planet earth has developed evolved without growing neoclassical growth models notwithstanding there is good evidence that neither the earth s surface nor the flux of solar energy grows at a rate equal to the rate of interest in fact they seem not to grow at all yet qualitative evolution occurred and continues to occur two general classes of limits to growth in the above defined sense can be further distinguished biophysical limits and ethicosocial limits in both cases it is growth not development that is limited there may or may not exist limits to development but that is another topic standard neoclassical economics was built on the assumption that the economy is far from both limits i e that it is always biophysically possible and ethicosocially desirable for aggregate product to grow as abramowitz l put it echoing pigou

farm productivity in rwanda effects of farm size erosion and soil conservation investments this paper examines the effects of farm size soil erosion and soil conservation investments on land and labor productivity and allocative efficiency in rwanda there were several key results first there is a strong inverse relationship between farm size and land productivity and the opposite for labor productivity for smaller farms there is evidence of allocative inefficiency in use of land and labor probably due to factor market access constraints second farms with greater investment in soil conservation have much better land productivity than average those with very eroded soils do much worse than average smaller farms are not more eroded than larger farms but have twice the soil conservation investments third land productivity benefits substantially from perennial cash crops and the gains to shifting to cash crops are highest for those with low erosion and high use of fertilizer and organic matter program and policy effort to encourage and enable farmers to make soil conservation investments to use fertilizer and organic matter and to participate in cash cropping of perennials will have big payoffs in productivity land markets that allow smaller farmers to buy land could also increase aggregate productivity

measuring the production efficiency of alternative land tenure contracts in a mixed crop livestock system in ethiopia abstract in this paper we test the hypothesis that land held under varying configurations of property rights will be farmed at different levels of production efficiency production data were collected from 477 plots in a fairly productive mixed farming system in the ethiopian highlands interspatial measures of total factor productivity based on the divisia index were used to measure the relative production efficiency of three informal and less secure land contracts rented share cropped and borrowed relative to lands held under formal contract with the ethiopian government although the informally contracted lands are farmed 10 16 less efficiently the analysis indicates that farmers of such lands actually apply inputs more rather than less intensively i e more inputs per unit of land the gap in total factor productivity thus results from the inferior quality of inputs or lack of skills in applying them rather than a lack of incentive to allocate inputs to mixed crop livestock farming for this reason we find no empirical basis to support the hypothesis that land tenure is a constraint to agricultural productivity

the wrong kind of transparency in a model of career concerns for experts when is a principal hurt from observing more information about her agent this paper introduces a distinction between information on the consequence of the agent s action and information directly on the agent s action when the latter kind of information is available the agent faces an incentive to disregard useful private signals and act according to how an able agent is expected to act a priori this conformist behavior hurts the principal in two ways the decision made by the agent is less likely to be the right one discipline and ex post it is more difficult to evaluate the agent s ability sorting the paper identifies a necessary and sufficient condition on the agent signal structure under which the principal bene ts from committing not to observe the agent s action the paper also shows the existence of strategic complementarities between information on action and information on consequence the results on the distinction between action and consequence are then used to interpret existing disclosure policies in delegated portfolio management in particular they are consistent with hitherto puzzling evidence that mutual funds systematically overperform pension funds

public infrastructure and productivity growth in greek agriculture recent research has focused on the effect of public infrastructure on economic performance in this paper a model of greek agriculture s technology and behaviour is constructed based on the dual cost function framework the model provides a decomposition of productivity growth into the components technical change returns to scale and public infrastructure the empirical estimates indicate that public infrastructure investment provides a significant return to agriculture and augments productivity growth over the period 1960 1995 the impact of public infrastructure on productivity growth in livestock and crop production is found to be positive although it has been declining since the late 1970s these results strongly suggest that a decline in public infrastructure investment can partly explain the observed decline in the productivity growth of greek agriculture in the 1980s

using privileged information to manipulate markets insiders gurus and credibility access to private information is shown to generate both the incentives and the ability to manipulate asset markets through strategically distorted announcements the fact that privileged information is noisy interferes with the public s attempts to learn whether such announcements are honest it allows opportunistic individuals to manipulate prices repeatedly without ever being fully found out this leads us to extend sobel s 1985 model of strategic communication to the case of noisy private signals our results show that when truthfulness is not easily verifiable restrictions on trading by insiders may be needed to preserve the integrity of information embodied in prices

managerial incentives and capital management the paper shows how career concerns rather than effort aversion can induce a natural incongruity in risk preferences between managers and superiors a model based on learning about managerial talent is developed to study second best contractual remedies we show that the optimal wage contract is an option of the value of the manager s human capital for insurance reasons and that consequently rationing of capital is often required to counterbalance the manager s resulting incentive to overinvest rationing is strictly superior to price decentralization offering one reason for the prevalence of centralized capital budgeting procedures

reputation concerned policy makers and institutional status quo bias abstract we study the policy choice of an office holding politician who is concerned with the public s perception of his capabilities the politician decides whether to maintain the status quo or to conduct a risky reform the reform s success depends critically on the politician s capabilities which are privately known to the politician the public observes both his policy choice and the outcome of the reform and assesses his competence we show that the politician may engage in socially detrimental reform in order to be perceived as more capable we investigate the institutional remedy that balances the gains and costs when the policy maker is subject to reputation concerns conservative institutions that thwart beneficial reform may potentially improve social welfare

productivity growth and convergence in crop ruminant and non ruminant production measurement and forecasts there is considerable interest in projections of future productivity growth in agriculture whether one is interested in the outlook for global commodity markets future patterns of international trade or the interactions between land use deforestation and ecological diversity the rate of productivity growth in agriculture is an essential input yet solid projections for this variable have proven elusive particularly on a global basis this is due in no small part to the difficulty in measuring historical productivity growth the purpose of this paper is to report the latest time series evidence on total factor productivity growth for crops ruminants and non ruminant livestock on a global basis we then follow with tests for convergence amongst regions providing forecasts for farm productivity growth to the year 2040 the results suggest that most regions in the sample are likely to experience larger productivity gains in livestock than in crops within livestock the non ruminant sector is expected to continue to be more dynamic than the ruminant sector given the rapid rates of productivity growth observed recently non ruminant and crop productivity in developing countries may be converging to the productivity levels of developed countries for ruminants the results show that productivity levels may be diverging between developed and developing countries