adapting contract theory to fit contract farming this article discusses the current state of contract theory and its usefulness for conceptualizing issues related to agricultural contracting i will discuss the limitations of existing theory for applied work and what methodological improvements are needed to enhance the usefulness of the theory to agricultural economists one pervasive problem is that the canonical economic literature on contracts is rather fragmented and the various methodological strands are narrow in their focus as such there is a need for agricultural economists to engage in methodological research to develop applied contracting models that can capture higher order features of real world agricultural contracts while delivering generalizable comparative statics predictions the need for such research is obvious as contracting continues to expand along the entire modern food marketing channel in the latter part of this article i develop a simple model to illustrate how classic methodological approaches can be combined with recent developments in contract and game theory to construct applied theory models that are useful for capturing some important features of agricultural contracts

grower risk aversion and the cost of moral hazard in livestock production contracts the use of contracts to vertically coordinate the production and marketing of agricultural commodities has become common practice in many agricultural sectors to solve the apparent asymmetric information problems between processors and independent farmers that universally plague these relationships the majority of contracts use high powered incentives schemes to compensate farmers in light of the renewed interest and increased pressure on the states and federal government to regulate production contracts a legitimate question to ask is how much are the producers going to loose if forced to replace the high powered incentives schemes that include performance bonuses with some low powered ones such as simple piece rates the answer to this question depends on the size of the cost of moral hazard the welfare cost of moral hazard emanates from the fact that contract growers are risk averse and face uncertain income streams the degree of risk aversion generates more or less disutility from uncertainty and plays an important role in the design of the optimal contract form the literature on the provision of incentives in firms is based on the premise that relating pay to performance increases output but at the cost of imposing risk on the agents which is reflected in higher compensations grower welfare depends on the type of contract he has signed the distribution of random factors affecting production and the shape of his utility function the objective of this article is to develop an analytical framework for the econometric estimation of the degree of risk aversion of farmers involved in the contract production of hogs and to carry out the empirical estimation of

measuring the energy security implications of fossil fuel resource concentration abstract economic assessments of the welfare effects of energy insecurity are typically uncertain and fail to provide clear guidance to policy makers as a result governments have had little analytical support to complement expert judgment in the assessment of energy security this is likely to be inadequate when considering multiple policy goals and in particular the intersections between energy security and climate change mitigation policies this paper presents an alternative approach which focuses on gauging the causes of energy insecurity as a way to assist policy making the paper focuses on the energy security implications of fossil fuel resource concentration and distinguishes between the price and physical availability components of energy insecurity it defines two separate indexes the energy security price index espi based on the measure of market concentration in competitive fossil fuel markets and the energy security physical availability index espai based on the measure of supply flexibility in regulated markets the paper illustrates the application of espi and espai with two case studies france and the united kingdom looking at the evolution of both indexes to 2030

a comparison of oil supply risks in eu us japan china and india under different climate scenarios for many countries the inflow of energy is essential to keep economies running oil is typically considered to be the most critical fuel as an input for the petro chemical and transportation sector and due to limited and less spread reserves in this study external oil supply risks are assessed for the period up to 2035 for the european union united states china japan and india being the five largest importers of oil in the world based on their current supplier portfolio scenarios are constructed for several climate policy and oil supply projections it is found that risks increase strongly when stringent climate policies are prevented from being implemented especially when a peak in oil supply is taken into account resulting in major oil supply disruptions china faces the lowest oil supply risks in most scenarios but the trends of india china and us converge over time due to increasing import dependency of china and india japan faces high risks since the country has the highest oil import dependency combined with a low oil import diversification for the eu all figures are strongly influenced by russia accounting for 32 of total imports and to a lesser extent norway 11 with high overall risks

information asymmetry and traceability incentives for food safety abstract we define traceability by its precision that is the probability of finding the source of a problem we consider a downstream food processor firm principal that sets traceability precision and contingent payments so to induce homogeneous upstream suppliers agents to exert the principal s preferred level of food safety effort we focus on cases in which food safety crises originate from defects in raw material provided by upstream firms to analytically show that high precision can substitute for high intensive contingent payments and vice versa and thus traceability is not an unequivocal signal for safer food contrary to previous results in the literature we also show that government regulation based on mandatory traceability with sanctions may not necessarily lead to safer food while increasing the food processor s costs finally we use our analytical results to give managerial feedbacks for firms adopting and considering traceability

trade finance specialization and synchronization i investigate the determinants of business cycle synchronization across regions the linkages between trade in goods financial openness specialization and business cycle synchronization are evaluated in the context of a system of simultaneous equations the main results are as follows i specialization patterns have a sizable effect on business cycles most of this effect is independent of trade or financial policy but directly reflects differences in gdp per capita ii a variety of measures of financial integration suggest that economic regions with strong financial links are significantly more synchronized even though they also tend to be more specialized iii the estimated role of trade is closer to that implied by existing models once intra industry trade is held constant the results obtain in a variety of data sets measurement strategies and specifications they relate to a recent strand of international business cycle models with incomplete markets and transport costs and on the empir

oil vulnerability index of oil importing countries abstract this paper assesses the relative oil vulnerability of 26 net oil importing countries for the year 2004 on the basis of various indicators the ratio of value of oil imports to gross domestic product gdp oil consumption per unit of gdp gdp per capita and oil share in total energy supply ratio of domestic reserves to oil consumption exposure to geopolitical oil market concentration risks as measured by net oil import dependence diversification of supply sources political risk in oil supplying countries and market liquidity the approach using the principal component technique has been adopted to combine these individual indicators into a composite index of oil vulnerability such an index captures the relative sensitivity of various economies towards developments of the international oil market with a higher index indicating higher vulnerability the results show that there are considerable differences in the values of individual indicators of oil vulnerability and overall oil vulnerability index among the countries both inter and intraregional

oil supply risk and affecting parameters associated with oil supplementation and disruption abstract the fossil fuel energy carriers significantly affect the energy security the oil security has turned to one of the main political agenda by considering the two world s oil crises in this study an index of oil supply vulnerability has been developed to compare the world s top fifteen oil importing south asian countries the index includes comprehensive set of indicators like imported oil over gdp ratio market liquidity gdp per capita geopolitical risk diversification the ratio of oil importation over consumption transportation risk oil price volatility and us volatility two popular techniques composite indicator ci and the principal component analysis pca were used to combine all the aforesaid indicators although numerous techniques have been used to assess the oil vulnerability index for example dea like models and markowitz theory of portfolio none of them incorporated the principal component analysis and composite indicator together to develop an oil vulnerability index results shows that the south asian countries have highest economic supply and overall oil vulnerability risk whereas the second group countries belgium thailand spain netherlands japan korea india and china are in a relatively less risky as compared to south asian countries contrary to this third group of countries are canada singapore uk and france italy germany and us are considered as a least vulnerable country

simulating the impacts of contract supplies in a spot market contract market equilibrium setting this article embeds a principal agent model within a market equilibrium model of contract and cash markets to analyze the impact of contracting on the spot market for hogs the equilibrium model incorporates both quality differentiation in the contract market and an endogenously determined cash market price for three types of contracting scenarios market equilibrium conditions are derived and results are presented for a numerical example contrary to some empirical results our model shows that the increased supply of hogs under typical formula price contracts can increase or decrease the cash market price depending on the relative size of overall contract supplies

do central banks respond to exchange rate movements a structural investigation abstract we estimate a small scale structural general equilibrium model of a small open economy using bayesian methods our main focus is the conduct of monetary policy in australia canada new zealand and the uk we consider generic taylor type rules where the monetary authority reacts in response to output inflation and exchange rate movements we perform posterior odds tests to investigate the hypothesis whether central banks do target exchange rates the main result of this paper is that the central banks of australia and new zealand do not whereas the bank of canada and the bank of england do include the nominal exchange rate in its policy rule this result is robust for various specification of the policy rule we also find that terms of trade movements do not contribute significantly to domestic business cycles

quantifying the supplier portfolio diversity of embodied energy strategic implications for strengthening energy resilience this paper investigates energy resilience of countries by quantifying the supplier diversification of both direct and embodied energy import in particular we quantify two approaches to diversify a country s supplier portfolio by lowering the dependency on each supplier portfolio diversification and by having embodied energy suppliers that are different from its direct energy suppliers portfolio differentiation we examine possibilities for strategic utilization of embodied energy trade to compensate for low diversity of direct energy trade for three types of fossil resources coal oil and gas we find that the diversity of embodied energy import is much greater than that of direct energy import of the three energy resources coal enables countries to adopt portfolio diversification and portfolio differentiation more than gas and oil our results suggest embodied energy can be considered as a transfer of energy resources across national borders that can directly benefit from the diversity of the world energy production by skipping the limited diversity of the world energy export

the transition to modern agriculture contract farming in developing economies recent years have seen considerable interest in the impact of contract farming on farmers in developing countries motivated out of belief that contract farming spurs transition to modern agriculture in this article we provide a thorough review of the empirical literature on contract farming in bo

energy security energy modelling and uncertainty the paper develops a framework to analyze energy security in an expected utility framework where there is a risk of disruption of imported energy the analysis shows the importance of an energy tax as a tool in maximizing expected utility and how the level of that tax varies according to the key parameters of the system risk aversion probability of disruption demand elasticity and cost of disruption

comparison of china s oil import risk results based on portfolio theory and a diversification index approach in recent years the international oil price has fluctuated violently bringing about huge risk for the international oil trade in fact the risk of crude oil and petroleum product imports is different because of the different import origins and prices which import risk is lower for china from the perspective of oil supply security how should china portfolio crude oil and petroleum product imports to minimize its oil import risk using portfolio theory and a diversification index approach this paper compares and analyzes the supply price and transport risks of crude oil and petroleum product imports our results show that the following 1 specific risk diversification risk and marine transport risk of china s petroleum product imports are lower than that of crude oil imports 2 the average rate of return of china s petroleum product imports is higher than that of crude oil imports moreover the average import price variance of petroleum product imports is lower than that of crude oil imports thus the systematic risk price risk of petroleum products is lower too therefore from the perspective of oil supply security china should increase petroleum product imports to decrease its oil import risk

evolving international inflation dynamics world and country specific factors inflation in the most industrialized economies of the world has an important international common component that accounts for the historical decline in the national rates country specific conditions explain the rise in inflation volatility of the late 1970s and early 1980s and the subsequent fall during the last decade the world contribution to the variance of inflation has become increasingly more important than national contributions monetary policy was a relevant source of country specific fluctuations our conclusions are based on a time varying dynamic factor model applied to a large panel of inflation indicators

stability of perishable goods in cold logistic chains abstract we consider that production and logistics facilities in the supply chain are positioned between the origin and the supply market or in a part of it any changes in time distance or temperature in the chain could cause the net present value of the activities and their added value in the supply chain to be perturbed in reality the perturbations can be robust the natural question arises is to what are the effects of some perturbations in a supply chain in its production or distribution part on the stability of perishable goods in such systems and what is the appropriate control which keeps the product on the required level of quality and quantity at the final delivery these analyses are especially important to assure the stability of cold chains in the cold chains management ccm what conditions should be fulfilled to assure that after such robust perturbations of parameters and especially time delays lead times and some other delays the behaviour of the logistics chain would still be within the prescribed limits the formulation obtained in the time domain will be compared with the formulation in the frequency space introduced by grubbstrom in his paper on the application of the laplace transform to certain economic problems manage sci 7 1967 558 and with the later studies of his school their model was extended by the authors to the complete logistic chain where location and with it also the distance between the activity cells of logistic chain play an important role

the status of conventional world oil reserves hype or cause for concern the status of world oil reserves is a contentious issue polarised between advocates of peak oil who believe production will soon decline and major oil companies that say there is enough oil to last for decades in reality much of the disagreement can be resolved through clear definition of the grade type and reporting framework used to estimate oil reserve volumes while there is certainly vast amounts of fossil fuel resources left in the ground the volume of oil that can be commercially exploited at prices the global economy has become accustomed to is limited and will soon decline the result is that oil may soon shift from a demand led market to a supply constrained market the capacity to meet the services provided by future liquid fuel demand is contingent upon the rapid and immediate diversification of the liquid fuel mix the transition to alternative energy carriers where appropriate and demand side measures such as behavioural change and adaptation the successful transition to a poly fuel economy will also be judged on the adequate mitigation of environmental and social costs

agribusiness economics and management agribusiness scholarship emphasizes an integrated view of the food system that extends from research and input supply through production processing and distribution to retail outlets and the consumer this article traces development of agribusiness scholarship over the past century by describing nine

measuring energy security can the united states achieve oil independence stochastic simulation of the direct economic costs of oil dependence in an uncertain future is proposed as a useful metric of oil dependence the market failure from which these costs arise is imperfect competition in the world oil market chiefly as a consequence of the use of market power by the organization of the petroleum exporting countries opec cartel oil dependence costs can be substantial it is estimated that oil dependence costs to the us economy in 2008 will exceed 500 billion other costs such as military expenditures or foreign policy constraints are deemed to be largely derivative of the actual or potential economic costs of oil dependence the use of quantifiable economic costs as a security metric leads to a measurable definition of oil independence or oil security which can be used to test the ability of specific policies to achieve oil independence in an uncertain future

the international dimension of inflation evidence from disaggregated consumer price data abstractwe estimate the contribution of international common factors to the dynam ics of price in ation rates of a cross section of 948 cpi products in four oecdcountries us germany france and uk we nd two main results first on average and at least in the sample 1991 2004 one international commonfactor explains between 15 and 30 percent of the variance of consumer prices depending on the transformation applied to the data given the high levelof disaggregation of our panel this estimate is best viewed as a lower boundfor the contribution of international factors to in ation dynamics second we nd a strongly positive and statistically signi cant relationship between expo sure of consumer in ation to international shocks and trade openness at thesectoral level the latter result holds regardless of whether the original dataare expressed in local as opposed to common currency keywords globalization in ation disaggregated consumer pricesjel classi cation number e3 e32 f2

assessing the date of the global oil peak the need to use 2p reserves combining geological knowledge with proved plus probable 2p oil discovery data indicates that over 60 countries are now past their resource limited peak of conventional oil production the data show that the global peak of conventional oil production is close many analysts who rely only on proved 1p oil reserves data draw a very different conclusion but proved oil reserves contain no information about the true size of discoveries being variously under reported over reported and not reported reliance on 1p data has led to a number of misconceptions including the notion that past oil forecasts were incorrect that oil reserves grow very significantly due to technology gain and that the global supply of oil is ensured provided sufficient investment is forthcoming to turn resources into reserves these misconceptions have been widely held including within academia governments some oil companies and organisations such as the iea in addition to conventional oil the world contains large quantities of non conventional oil most current detailed models show that past the conventional oil peak the non conventional oils are unlikely to come on stream fast enough to offset conventional s decline to determine the extent of future oil supply constraints calculations are required to determine fundamental rate limits for the production of non conventional oils as well as oil from gas coal and biomass and of oil substitution such assessments will need to examine technological readiness and lead times as well as rate constraints on investment pollution and net energy return

international business cycles world region and country specific factors the paper investigates the common dynamic properties of business cycle fluctuations across countries regions and the world we employ a bayesian dynamic latent factor model to estimate common components in macroeconomic aggregates output consumption and investment in a 60 country sample covering seven regions of the world the results indicate that a common world factor is an important source of volatility for aggregates in most countries providing evidence for a world business cycle we find that region specific factors play only a minor role in explaining fluctuations in economic activity we also document similarities and differences across regions countries and aggregates jel f41 e32 c11 c32

globalization macroeconomic performance and monetary policy the paper argues that many of the exaggerated claims that globalization has been an important factor in lowering inflation in recent years just do not hold up globalization does however have the potential to be stabilizing for individual economies and has been a key factor in promoting economic growth the paper then examines four questions about the impact of globalization on the monetary transmission mechanism and arrives at the following answers i has globalization led to a decline in the sensitivity of inflation to domestic output gaps and thus to domestic monetary policy no ii are foreign output gaps playing a more prominent role in the domestic inflation process so that domestic monetary policy has more difficulty stabilizing inflation no iii can domestic monetary policy still control domestic interest rates and so stabilize both inflation and output yes iv are there other ways besides possible influences on inflation and interest rates in which globalization may have affected the transmission mechanism of monetary policy yes

indicators of energy security in industrialised countries energy security has become a popular catch phrase both in the scientific arena as well as in the political discussion yet in general the applied concepts of energy security are rather vague this paper sheds some light on concepts and indicators of energy security first we conceptually discuss the issue of energy supply security and explain why it is not to handle by one science alone and what economics may contribute in order to structure the topic after providing a brief survey of existing attempts to define or measure energy security we suggest an additional dimension along which indicators of energy security may be classified ex post and ex ante indicators finally we illustrate our concept on the basis of several simplified indicators while ex post indicators are mostly based on price developments ex ante indicators are to a greater extent aimed at illustrating potential problems our illustration suggests that it is worthwhile to take into account the market structure along with the political stability of exporting countries

input versus output monitoring who is the residual claimant abstract we observe that residual claimancy can be a source of rent in a principal agent relationship we show that the choice between input or output monitoring will be chiefly determined by the identity of the residual claimant of the principal agent relationship the principal will find input monitoring more efficient if the principal is the residual claimant and he will find output monitoring more efficient if the agent is the residual claimant if residual claimancy is a choice the principal will be the residual claimant under input monitoring under output monitoring residual claimancy is not an issue if both residual claimancy and the monitoring instrument can be chosen the principal will choose to monitor input and to be the residual claimant journal of economic literature classification numbers d23 d82 l22

designing targeting rules for international monetary policy cooperation this study analyzes a two country dynamic general equilibrium model with nominal rigidities monopolistic competition and producer currency pricing a quadratic approximation to the utility of the consumers is derived and assumed as the policy objective function of the policymakers it is shown that only under special conditions there are no gains from cooperation and moreover that the paths of the exchange rate and prices in the constrained efficient solution depend on the kind of disturbance that affects the economy it might be the case either for fixed or floating exchange rates despite this result simple targeting rules that involve only targets for the growth of output and for both domestic gdp and cpi inflation rates can replicate the cooperative allocation

global oil depletion a review of the evidence within the polarised and contentious debate over future oil supply a growing number of commentators are forecasting a near term peak and subsequent decline in production but although liquid fuels form the foundation of modern industrial economies the growing debate on peak oil has relatively little influence on energy and climate policy with this in mind the uk energy research centre ukerc has conducted an independent thorough and systematic review of the evidence with the aim of establishing the current state of knowledge identifying key uncertainties and improving consensus the study focuses upon the physical depletion of conventional oil in the period to 2030 and includes an in depth literature review analysis of industry databases and a detailed comparison of global supply forecasts this communication summarises the main findings of the ukerc study a key conclusion is that a peak of conventional oil production before 2030 appears likely and there is a significant risk of a peak before 2020

energy price slump and policy response in the coal chemical industry district a case study of ordos with a system dynamics model we employ system dynamics method towards a coal chemical industry district economy evolution model using coal industry the coal chemical industry their downstream industries and the manufacture related service industry moreover we construct energy price and policy response scenarios based on ordos management experience the results show that the energy price slump had a negative impact on the overall economic development of the coal chemical industry district despite promoting non resource industries furthermore policies had different effects on the industry s output value and profit in the long term developing alternative industries ai helps increase the industrial output value and profit decreasing value added tax vat has immediate results and a distinctive effect on industrial short term production value and profit its long term effect being limited the effect of production limit pl on industrial profit is stronger than output value and financial support fs is more conducive to improve the latter however coal mining and coal chemical loan increases decrease the gross industrial profit level technology innovation ti has the best individual policy overall effect on production value and profits furthermore the simultaneous implementation of pl ti and ai can generate the synergy effect for each of them and the simultaneous implementation of vat and one or couple of other policies will generate the crowding out effect both for vat and other policies

optimal sharing of foodborne illness prevention between consumers and industry the effect of regulation and liability consumers and the food industry can both prevent foodborne illness two questions are explored what is the socially optimal level of preventative effort by each and can tort and regulatory instruments induce such behavior analysis is complicated by two aspects of food safety technology one party s effort can affect the marginal effectiveness of the other party s effort and damage functions can be nonconvex previous analysis of accidents under torts and regulation fails to consider these generalizations indeed results concerning the ability of tort and regulatory instruments to induce first best and second best behavior often contradict previous results in the literature

contract choice in modern agriculture cash rent versus cropshare e conomists have expended enormous effort examining the rationale for various contractual arrangements in agriculture particularly sharecropping while economists have made considerable theoretical efforts to understand agricultural contracts few empirical studies have been undertaken the dearth of empirical analyses of agricultural contracts is particularly striking for modern western agriculture this is an important omission not only because the existing empirical work tends to focus on the question of efficiency but also because the theoretical models tend to examine contracts that bear little resemblance to those found in the united states today

future oil supply the changing stance of the international energy agency the iea was established in 1974 with a mandate to promote energy security amongst its members namely the states of the oecd and to advise those members on sound energy policy its recent forecasts of the medium and long term prospects for oil supply however have wavered alternating from optimistic to pessimistic and back again for policy makers such inconsistency is difficult to deal with firstly we examine whether the changing outlooks seen in iea forecasts made between 2007 and 2010 truly reflect a demonstrable underlying change in the known facts and we can find no such factual changes reported by the iea secondly we examine whether the serious criticisms of the iea s 2008 forecast made by other analysts have yet been addressed and we conclude that they have not thirdly we consider the possible effects of the current economic downturn upon the iea s assumptions and upon future oil supply we conclude that all the forecasts made by the iea appear to be too optimistic throughout this period

globalization and monetary policy comovement international evidence abstract this paper empirically characterizes the comovement in monetary policy of five advanced economies in the period 1980 2009 i estimate a taylor rule for each country and use the residual of the taylor rules to estimate a dynamic latent factor model with common and europe specific factors i quantify the importance of the common factor in explaining comovement in the residual variation of monetary policy and show that the common factor is particularly important during a period of globalization 1988 2003 i estimate the dynamics of the importance of the common factor using rolling sub samples and show that trade openness increases the importance of the common factor in monetary policy in the us

stock market synchronization and monetary integration abstract this paper focuses on the relationship between stock market comovements and monetary integration a panel specification is used to explain bilateral stock market return correlations between fifteen developed economies over the period 1975 2006 time fixed effects are included to capture global shocks and we also examine the role of bilateral trade linkages and international financial integration monetary integration leads to stronger stock market synchronization both through the elimination of exchange rate volatility and through the common monetary policy and the convergence of inflation expectations trade and financial integration also contribute to higher stock market return comovements

broiler production contracts as a multi agent problem common risk incentives and heterogeneity the broiler industry presents two puzzles regarding production contracts why do processors control growers inputs and why do they use a statistically insufficient estimator to calculate growers compensation this paper provides an agency theoretic framework that explains these puzzles in terms of processors response to grower heterogeneity and production risk and to grower risk aversion processors control inputs to reduce the information rents paid to agents by forcing agents to bear additional income risk through the use of an imprecise estimator processors can increase profits due to the combined moral hazard adverse selection nature of the informational problem

monetary policy in the open economy revisited the case for exchange rate flexibility restored abstract this paper revisits the sticky price pricing to market model of devereux and engel devereux m b engel c 2003 monetary policy in the open economy revisited price setting and exchange rate flexibility review of economic studies 70 4 765 783 in which fixed exchange rates are optimal even in the face of country specific nonmonetary shocks we show that this result hinges critically on the devereux engel model s prediction that international consumption levels are perfectly synchronized under flexible prices realistic modifications of the model that produce nonsynchronous consumption movements such as the presence of nontraded goods upset the fixed exchange rate prescription even in the absence of an expenditure switching role of exchange rate changes

a unified world oil market regions in physical economic geographic and political space although there is a general consensus that the market is unified here we quantify the factors that create regions by analyzing the price relation between 33 crude oils adf statistics indicate that 447 of the 528 crude oil pairings cointegrate 81 do not the presence absence of cointegration is analyzed using a logit model the likelihood that the prices for two crude oils cointegrate depends on their physical characteristics density and sulfur content economic factors country risk for the nation of origin their geographic location distance between supply ports and political factors opec membership over the sample period the technology to refine heavy crude oils penetrates the market and this reduces the price difference between heavy and light crude oils the effect of country risk implies that crude oils from high risk nations are not perfect substitutes for crude oils of similar quality from low risk nations finally crude oils from widely separated suppliers are more likely to cointegrate than crude oils from near by nations which suggests consumers diversify supply across transportation chokepoints for this sample these sources of regionalization add 0 20 per barrel to the 2 86 average price difference between crude oils in the same market together these factors have important implications for the efficacy of policy aimed at reducing dependence on unreliable suppliers and the spill over effects of holding inventories

the impact of opec on east asian oil import security a multidimensional analysis abstract east asian countries such as china japan and south korea are major importers in the international oil market therefore oil import security is critical to sustainable economic development in these countries this paper uses a modified two stage dea like model to investigate the impact of the organization of petroleum exporting countries opec on oil import security in the east asian region over time specifically three dimensional variables were introduced to the model the opec internal dimension the opec and asian country interaction dimension and the international external dimension the empirical results show a substantial difference between china and the other two countries in terms of these dimensions although the impact of opec on china s oil security has increased over time its impact on japan has declined political uncertainty in opec countries and oil price volatility are the major issues for china whereas cost is the key area of concern for japan south korea s concerns are less clear the results of this study lay an important foundation for discussing policy issues involved in regional cooperation integration and sustainable growth in the east asian region

long term energy services security what is it and how can it be measured and valued abstract the paper reviews some recent approaches towards measuring the extent of long term energy security and security externality valuation it starts out to discuss the contextual connotations of notions of energy security in medium to long term time frames and reviews some indicators that have been proposed to quantify it special attention is paid to two of these approaches which the authors helped to develop i e diversity based indices and the supply demand index the paper takes issue with conventional welfare economic approaches that neglect i the scope on the demand side for raising security and ii negative feedback mechanisms of socio political impacts of international rent transfers in fossil fuels exporting countries the concept of energy services security is proposed with a demand side focus this enables application of an integrated approach to gauge the resilience of a society to meet the needs of its population for energy services over longer timescales ahead from various interrelated perspectives propositions are made on the attribution of security externalities to the use of fossil fuels policies and suggestions for further improvements of measures for energy services security

reading the fine print in agricultural contracts conventional contract clauses risks and returns one distinguishing feature of ongoing struc tural change in agriculture is increasingvertical coordination between agriculturalproducers and processors much of which hascome through agricultural production andmarketing contracts agricultural economists extension agents legal aid groups and othershave sought to provide farmers with infor mation that enables them to make informeddecisions regarding contract use while allsensible advice begins with suggesting thata farmer consult his or her attorney and ac countant before signing numerous outreachpublications provide information regardingspeci c contract provisions see for example holman feuz and baltensperger 2006 kunkel and larison 2006 of ce of the illinoisattorney general 2005 in contrast to the relatively comprehensiveanalysis in such outreach efforts agriculturaleconomists theoretical analyses of speci cagriculturalcontractprovisionshavetendedtofocusoncontractualprovisionsregardingcom pensation and to some extent on input provi sion when comparing the average theoreticalmodel to an actual agricultural contract thereare pages of the contract that do not appear inthe model at all much of the material omitted in theoreti cal analyses of agricultural contracts is boil erplate boilerplate is standardized contractterms that are used in multiple contacts these

implications of nash bargaining for horizontal industry integration this article shows how horizontal industry integration can arise from transferable asymmetry of technologies and endowments the nash bargaining solution suggests that greater technological diversity among coordinating parties yields greater gains from horizontal integration the framework fits the case where a firm with a superior technology franchises the technology by horizontal integration the results appear to fit hog production where integration has been primarily horizontal and in part broiler production where integration has been both vertical and horizontal specifically technology has been shared through uniform genetic traits fine tuned feed rations and veterinary services specified in grower contracts

international dimensions of optimal monetary policy abstract this paper provides a baseline general equilibrium model of optimal monetary policy among interdependent economies with monopolistic firms and nominal rigidities an inward looking policy of domestic price stabilization is not optimal when firms markups are exposed to currency fluctuations such a policy raises exchange rate volatility leading foreign exporters to charge higher prices vis a vis increased uncertainty in the export market as higher import prices reduce the purchasing power of domestic consumers optimal monetary rules trade off a larger domestic output gap against lower consumer prices optimal rules in a world nash equilibrium lead to less exchange rate volatility relative to both inward looking rules and discretionary policies even when the latter do not suffer from any inflationary or deflationary bias gains from international monetary cooperation are related in a non monotonic way to the degree of exchange rate pass through

diversification of oil import sources and energy security a key strategy or an elusive objective this paper explores the relationship between the diversification of sources of imported oil and energy security of oil importing countries it examines the importance of diversification policy for oil importers explains why oil importers implement oil diversification policy and contextualizes the oil import diversification strategy in the overall energy security policy of oil importers the paper analyzes the factors and the contexts that affect the level of importance assigned to oil import diversification policy in oil importing countries and the limitations that may affect the successful implication of oil import diversification policy the examples are drawn from the world s top three oil importers the united states japan and china the policymakers in these and other oil importing countries place much importance on energy security the diversification of oil import sources is used as one of the strategies to enhance energy security in oil importing countries this paper is important for policymakers in oil importing countries as it provides them with a qualitative conceptual framework with which to evaluate the need to diversify their countries sources of imported oil and with which to identify the likely limitations to the successful implementation of oil import diversification policy

transactions costs and the efficient organization of production a study of timber harvesting contracts a transaction costs framework is developed to explain the choice between lump sum and per unit payment provisions in private timber harvesting contracts predictions about which contract type minimizes the transaction costs of presale measurement and contract enforcement and monitoring are derived and tested using private timber sales contracts from north carolina the empirical results provide strong support for the transaction costs approach and also reject several predictions from a risk based model the transaction costs framework also provides insights into the choice between negotiated and competitive sales procedures

measuring the reaction of monetary policy to the stock market movements in the stock market can have a significant impact on the macroeconomy and are therefore likely to be an important factor in the determination of monetary policy however little is known about the magnitude of the federal reserve s reaction to the stock market in part because the simultaneous response of equity prices to interest rates makes it difficult to estimate this paper uses an identification technique based on the heteroskedasticity of stock market returns to measure the reaction of monetary policy to the stock market we find a significant policy response with a 5 percent rise fall in the s p 500 index increasing the likelihood of a 25 basis point tightening easing by about a half

understanding the evolution of world business cycles abstract this paper studies the changes in world business cycles during the period 1960 2003 we employ a bayesian dynamic latent factor model to estimate common and country specific components in the main macroeconomic aggregates output consumption and investment of the g 7 countries we then quantify the relative importance of the common and country components in explaining comovement in each observable aggregate over three distinct time periods the bretton woods bw period 1960 1 1972 2 the period of common shocks 1972 3 1986 2 and the globalization period 1986 3 2003 4 the results indicate that the common g 7 factor explains on average a larger fraction of output consumption and investment volatility in the globalization period than it does in the bw period

the end of peak oil why this topic is still relevant despite recent denials up until recently peak oil was a major discussion point crossing from academic research into mainstream journalism yet it now attracts far less interest this paper evaluates the reasons for this and on going relevance of peak oil considering variations in predictive dates for the phenomenon supported by technological economic and political issues using data from agencies the validity of each position is assessed looking at reserves industrial developments and alternative fuels the complicating issue of demand is also considered the conclusions are that supported by commercial interests an unsubstantiated belief in market and technical solutions and a narrow paradigmatic focus critics of peak oil theory have used unreliable reserve data optimistic assumptions about utilisation of unconventional supplies and unrealistic predictions for alternative energy production to discredit the evidence that the resource limited peak in the world s production of conventional oil has arrived diverting discussion from what should be a serious topic for energy policy how we respond to decreasing supplies of one of our most important energy sources

marketing contracts and crop insurance contracts between farmers and intermediaries and crop insurers are important means for farmers to mitigate risks in modern u s agriculture in this paper we investigate the effect of crop insurance enrollment on contract terms and farmers participation in marketing contracts following ligon 2003 we set up a mechanism design framework to demonstrate an intermediary s contract design problem where farmers are assumed to be utility maximizing agents we depict farmers optimal choices of insurance coverage using the specification developed by babcock 2012 our model shows that improved terms of crop insurance lower premiums higher subsidies make contracts less appealing to farmers as mechanisms for mitigating risk therefore intermediaries may revise their contract offers so that they are more attractive however improvements in contract terms are limited by their cost to the intermediaries and will not lead to expanded participation in contracts

leadership and the provision of safe food modern food production typically involves many interacting stages and two or more decision makers there is reason to believe that inputs in determining quality likely complement and it is not possible to regulate many of these inputs in a food production system possessing these characteristics we show that leadership by one or more firms through communicating actions may be used as a mechanism to increase overall food quality as there may be no private incentive to lead there may be strategic merit in assigning liability through legislation we also suggest the possibility that genetics are leadership instruments in hog production systems copyright 2001 oxford university press