the methodology of contractarianism in economics the paper explores the methodology of hypotheticalcontractarianism as a means of justifyingrules of social conduct formally thecontractarian argument has the logicalstructure of a familiardeductive nomological rational choice explanation it necessarily requires however that at least some premises usedin its explanans be empiricallyfalse it is argued that in contrast toordinary explanatory arguments thecontractarian thought experiment would bepointless if all assumptions wereempirically true as a consequence even inthe case that a given contract theory canbe proven to be logically consistent itfails to justify binding obligations ofreal individuals due to an insurmountablelogical problem of induction

dualism and reform in china according to the dual economy tradition of economic development models less developed economies at an early stage of development are marked by a dichotomy between a modern sector in which workers are hired at an institutional wage in numbers that rise with the growth of the industrial capital stock and a traditional sector in which workers subsist at an income level that is somewhat below the indus

structural factors in the economic reforms of china eastern europe and the former soviet union reform in china and russia jeffrey sachs and wing thye woo china s experience does not show that gradual reform is superior to the shock therapy undertaken in eastern europe and the former soviet union eefsu differing performance primarily reflects different economic structures prior to reform china was a peasant agricultural society eefsu was urban and overindustrialized in both jobs in state enterprises were so heavily subsidized that workers refused to move to new industries elsewhere even when productivity in the latter was much higher in eefsu the large state sector impeded structural adjustment curtailing subsidies would have produced many losers who used their power to resist this outcome failure to curtail subsidies then cut off the potential supply of labour and other factors to new emerging firms china s state enterprises have not performed as well as the rest of the chinese economy and do not explain its success rapid growth was possible because the large agricultural sector contained vast surplus labour and did not enjoy subsidies and soft budget constraints once constraints on migration across regions and jobs were removed this labour was available to fuel expansion in new industries unlike the distributional conflict in eefsu in china reallocation of labour allowed all groups to gain in both partial liberalization also unleashed macroeconomic pressures manageable in china because of rapid growth and adequate monetary policy but explosive in much of eefsu because of deeper structural problems and gross monetary mismanagement

are the poverty effects of trade policies invisible beginning with the wto s doha development agenda and establishment of the millennium development goal of reducing poverty by 50 percent by 2015 poverty impacts of trade reforms have become central

potential implications of a special safeguard mechanism in the world trade organization the case of wheat the special safeguard mechanism both quantity and price based was key in the july 2008 failure to reach agreement in the world trade organization wto negotiations under the doha development agenda a stochastic simulation model of the world wheat market is used to investigate the effects of the special safeguard mechanism as expected the quantity based safeguard is found to reduce imports raise domestic prices and boost mean domestic production in the countries that implement it however rather than insulating developing countries in those regions from price volatility the quantity based safeguard increases domestic price volatility largely by restricting imports when domestic output is low and prices are high the quantity based safeguard shrinks average wheat imports nearly 50 percent in some regions and global wheat trade falls by 4 7 percent the price based safeguard discriminates against lower price exporters and contributes to producer price instability

tracking distortions in agriculture china and its accession to the world trade organization this article examines the impacts of china s accession to the world trade organization wto on prices in its agricultural sector the analysis uses a new methodology to estimate nominal protection rates in china s agricultural sector before its accession to the wto these new measures account for differences in commodity quality within china and between china and world markets the analysis shows that some of china s agricultural commodities are well above world market prices and others are well below the article also assesses market integration and efficiency in china it finds high degrees of integration between coastal and inland markets and between regional and village markets the remarkable improvements in market performance in recent years mean that if increased imports or exports affect china s domestic price near the border producers throughout most of china will feel the price shifts

innovation and bureaucracy under soft and hard budget constraints because of the inherent uncertainty promotion of innovation critically depends on screening mechanisms to select projects this paper studies the relationship between bureaucracy and financial constraints as two such mechanisms the lack of commitment to hard financial constraints interferes with its ex post screening capability ex ante bureaucratic screening is optimally chosen as a substitute however bureaucracy makes mistakes by rejecting promising projects and delays innovation and the efficiency loss due to soft financial constraints increases as prior knowledge becomes worse and as research stage investment requirements become lower in a centralized economy bureaucracy may reduce the number of parallel projects particularly for projects with higher uncertainties and less research stage requirements this theory fits much of the evidence and in particular it explains why the computer industry but not the nuclear or aerospace industries has fared so poorly in centralized economies the fundamental importance of innovation to the survival and evolution of economic systems and organizations has long been recognized marx 1978 schumpeter 1950 innovation is characterized by its inherent uncertainty because it is a process whose every element takes considerable time in revealing its true features and ultimate effects schumpeter 1950 p 83 and people are unable to anticipate the future impact of successful innovations even after their technical feasibility has been established rosenberg 1994 an understanding of how different systems and organizations deal with the uncertainties associated with innovation and the resultant consequences is crucial for understanding alternative economic systems and organizations in this paper we provide a theory to analyse how different systems screen uncertain innovative projects and the impact of the various screening mechanisms on those systems we distinguish two alternative screening mechanisms the bureaucratic screening mechanism vs the market screening mechanism the latter is directly linked to financial constraints with this perspective our theory explains why centralized economies did well in certain areas of innovation but fared poorly in others for instance in the early 1960s the west was frightened by the ussr s great success in launching the first unmanned satellite and the first manned space capsule while in the 1980s in contrast the centralized system

grain price spikes and beggar thy neighbor policy responses a global economywide analysis when prices spike in international grain markets national governments often reduce the extent to which that spike affects their domestic food markets those actions exacerbate the price spike and international welfare transfer associated with the terms of trade change several recent analyses have assessed the extent to which those policies contributed to the 2006 08 international price rise but only by focusing on one commodity or using a back of the envelope method this paper provides a more comprehensive analysis that uses a global economywide model that is able to take account of the interactions between markets for farm products that are closely related in production or consumption the model is able to estimate the impacts of those insulating policies on grain prices and on the grain trade and economic welfare of various countries the results support the conclusion from earlier studies that there is a need for stronger world trade organization disciplines on export restrictions

transition and integration in europe implications for agricultural and food markets policy and trade agreements several central and eastern european countries are on their way to becoming members of the european union agriculture and agricultural policy is an important issue in eu enlargement this paper reviews the changes that have occurred in the agricultural and food sector of the ceecs and draws implications for the impact of eu enlargement on agri food markets and policy first those countries which have reformed most rapidly and most thoroughly are now doing best and their reform efforts have resulted in significant recovery and efficiency improvements second the impact of eastern enlargement will be less dramatic than initially feared although some uncertainty remains the possibility that the accession of the ceecs into the cap will cause a conflict with wto commitments has been reduced but cannot be excluded for some specific commodities depending on the ceec supply evolution however the likelihood of a wto conflict and the impact on the cap will depend more on the outcome of the negotiations in the wto millennium round than on enlargement similarly the impact of enlargement on the eu budget depends mostly on the political decision on the allocation of direct payments to ceec farmers and or of the extent of structural funds for ceecs

the creation and spread of technology and total factor productivity in china s agriculture the overall goal of this study is to create a framework for assessing the trends of china s national and international investment in agricultural research and to measure its impact on total factor productivity the main methodological contribution is to provide more convincing measures of crop specific technologies from china s national research program and of those imported from the international agricultural research system our results find that from 1980 to 1995 china s total factor productivity for rice wheat and maize grew rapidly and new technology accounts for most of the productivity growth

euvoluntariness and just market exchange moral dilemmas from locke s venditio it is a maxim of public choice that voluntary exchanges should not be interfered with by the state but what makes a voluntary market exchange truly voluntary we suggest contra much of the economics literature that voluntary exchange requires consent uncoerced by threats of harm but that this is not sufficient in particular a person pressured to exchange by the dire consequences of failing to exchange e g dying of thirst or hunger is still coerced and coerced exchange cannot be voluntary the weaker party s desperation gives the other party unconscionable bargaining power we argue for a distinction based on a neologism in the case of coercion by circumstance but not by threat exchange is still voluntary in the conventional sense but it is not euvoluntary i e truly voluntary we will argue that all euvoluntary exchanges are just while non euvoluntary exchanges may or may not be unjust that in competitive markets all exchanges are just even those that are not euvoluntary while in bilateral monopolies some exchanges are neither euvoluntary nor just we will propose a mental device the fictitious negotiation to determine the just price in non euvoluntary market exchanges a primitive version of these ideas can be found in a little known monograph by john locke which we will analyze in detail

rural urban disparity and sectoral labour allocation in china this study examines china s rural urban segmentation and its causes in the context of economic reforms household survey and aggregate data indicate a v shaped process in which rural urban consumption and income differentials decreased between 1978 and 1985 but then have continually increased to historically high levels this sectoral division is consistent with production function estimates based on provincial data that reveal higher labour productivity in urban state owned industries than in rural industries and agriculture to explain the v shaped change we argue that the precedent of successful rural reforms raised farmers relative earnings but the remaining obstacles to an efficient sectoral allocation of labour have prevented china from eliminating dualism recent financial policies consisting of urban price subsidies and increased investment credits have also had influential distribution effects that are biased against the rural sector

changes in trade and domestic distortions affecting china s agriculture this paper assesses the implications of china s trade and domestic policies for incentives to producers in china it uses a price comparison methodology nominal rates of assistance at the border and the farmgate with adjustments for exchange rate distortions in the first part of the sample period 1981 1994 on average distortions to agricultural incentives have been reduced in the early 1980s on average china s domestic prices were far below international prices there were substantial variations however between imported which were being protected and exported goods during the 1980s and 1990s the gap between domestic and international prices for both imports and exports narrowed initially mainly due to the elimination of domestic policy distortions between the mid 1990s and 2004 trade liberalization policy furthered narrowed the gap between world and china farmgate prices by the mid 2000s china s agriculture was operating with only small price distortions

trends in agricultural price and trade policy instruments since 1990 in central european countries a survey of agricultural price and trade policy instruments of central european countries since the beginning of economic transition indicates several similar patterns of instrument choice among the transition economies we find that the common pattern of agricultural policy choices in central european countries mirrors many important features of the western european experience in addition we also find that free trade associations and international agreements have and will increasingly limit the set of agricultural price and trade policy instruments available to governments

common fallacies in the debate on the transition to a market economy fallacies and other lessons leszek balcerowicz words and the concepts they express exert a powerful influence on political debate and policy decisions in transition economies in this introductory essay the principal architect of the first radical reform programme in europe after the fall of the berlin wall develops a lexicon of common fallacies in the political debate and introduces many of the main themes of the volume one common fallacy is that of country specificity ukraine is different what worked or did not work elsewhere is not relevant here some countries may indeed have specific economic problems viz the huge military industrial sector in ukraine but economic theory is clear about which policies are best for basic problems macroeconomic stabilization as the appropriate response to hyperinflation price liberalization and liberalization of supply are the prescribed therapy for massive shortages etc so there are useful lessons to be learned from prior experience by the same token erroneous interpretation of those experiences can give credence to mistaken policy arguments for example the argument that whatever has been done before in the west must be right is itself clearly wrong similarly balcerowicz argues that china s success does not prove the universal merits of gradualism the agricultural reforms of the late 1970s in china were in practice surprisingly radical the essay identifies many other pitfalls in reasoning about transition experience several having to do with the failure to apply ceteris paribus reasoning for example the fall in output in 1991 in all the countries connected with the former soviet union including finland was caused in large part by the collapse of their trade with the union and certainly not exclusively by the policies they followed there are numerous other examples

chinese urbanization and development before and after economic reform a comparative reappraisal abstract this paper analyzes the recent process and consequences of china s urbanization by weighing the short term policies and long term strategies concerning national development and urban growth against the objective material conditions and competing group interests in chinese society comparative insights are drawn from the experiences of other late developing countries where the effects of political decisions concerning urban growth have been fundamentally modified by social and economic forces thus china s urbanization is examined here in terms of the four major aspects of third world urbanization overurbanization urban bias and the parasitic versus generative nature of cities rural development and the role of small urban places and interregional balance in urbanization and development the rapid and complex process of urbanization certainly helps boost the dynamic of the post mao chinese economy but not without the problematic symptoms of congestion and inequality

on the past and future of china s township and village owned enterprises abstract this paper proposes an explanation of the historical success of industrial enterprises owned by township and village governments in china i argue that conditions peculiar to china s prereform economy fostered the growth of a skilled workforce and high savings created unusual market niches and encouraged entrepreneurial undertakings by local political elites especially in areas adjacent to certain cities i then discuss the allocative and technical efficiency of local public enterprises in china from a theoretical standpoint and review some relevant econometric findings finally i consider proposals for reform of town and village enterprise tve ownership and discuss the possible advantages of cooperative forms

the simultaneous use of rival models in policy optimisation an important problem in macroeconomic policy design that has hitherto received little attention is the uncertainty of model structure by that we mean that more than one model fits the data reasonably well however each model is based on a different school of economic thought and thus has a different structure hence our analysis is based on non nested models when statistical inference cannot reject one model in favour of the other in this paper we discuss a way in which policy optimisation can be used to derive policies that are compatible with more than one model structure this is accomplished by extending an optimisation algorithm for a single nonlinear model of the economy to handle simultaneously more than one model and objective function the algorithm is designed to be efficient and relatively modest in its storage requirements a minimax extension is also considered for optimal policies robust to model choice when any one of the models turns out to represent the real economy two large scale nonlinear models of the uk economy are used simultaneously to obtain policies which are optimal with respect to a combined cost function this cost function is a combination of the cost functions associated with the individual models the models used are the h m treasury model and the model of the national institute of economic and social research

why is there controversy regarding china s staple grain food market integration evidence and implication from price convergent club analysis there remains ongoing controversy regarding the degree to which chinese food markets are integrated some economists conclude that china s grain economy is well integrated while others argue that china s gradual reforms have led to fragmented domestic markets while others conclude that previous studies have produced mixed results to reconcile the debate this article models and analyses the behaviour of china s food grain retail markets by testing for the existence of the convergent price clustering clubs using appropriate econometric methods and price data over 1997 2010 the article finds evidence as to why the controversy remains by identifying a number of small divergent price clustering clubs where it is hard to conclude that china s food grain markets are fully integrated however given that large convergent clustering clubs were also identified it can be concluded that the degree to which chinese grain food retail markets are integrated is high this finding is important for those who plan to

public choice and the economic analysis of anarchy a survey public choice economists began studying anarchy in the 1970s since then the amount of research on anarchy has burgeoned this article surveys the important public choice contributions to the economics of anarchy following early public choice economists many economists are researching how individuals interact without government from non public interested explanations of the creation of government to historical studies of internalizing externalities under anarchy public choice scholars are arriving at a more realistic perspective of human interaction with and without government although the economics of politics receives more attention the economics of anarchy is an important area of research in public choice

the transition to a market economy pitfalls of partial reform we present a theory of a partial economic reform of a planned economy similar to the one that took place in russia since 1988 and in china earlier in such a reform some markets are liberalized in the sense that producers can sell output to whomever they want including private firms at free prices but at the same time must sell to state firms at state prices we show that such a reform can result in a substantial diversion of subsidized inputs away from state firms and toward private firms even when state firms value these inputs more the result may be a reduction of total output the simple analysis sheds light on many consequences of the soviet reform such as breakdown of coordination of production increased state policing of delivery quotas prohibitions of trading cooperatives and opposition to privatization the model also explains why partial reform failed in russia but worked in china

prohibition of factor market exchanges and technological choice in chinese agriculture this article constructs a model of technological choice in an economy where market exchanges in land and labour are prohibited empirical data on demand for tractors tractor usage and chemical fertilisers in china are employed to test several hypotheses derived from the theoretical model the theory implies that the impact of relative factor scarcity on the pattern of technological choice in such an economy is similar to that in a market economy as postulated by the hicks ruttan hayami binswanger hypothesis of induced technological change the empirical evidence is found to be consistent with the implications of the model

global models applied to agricultural and trade policies a review and assessment the continuing process of global integration bears implications for farmers and related supplying and processing industries in all parts of the world but also for the rest of the world economy an assessment of agricultural and trade policy impacts is bound to be complex and is often supported by quantitative modeling analysis this article provides an assessment of the present state of applied modelling in the area of trade and agricultural policies we provide in this paper a comparative assessment of alternative modelling approaches considering a total of 16 partial equilibrium and general equilibrium models the assessment includes theoretical modelling foundations datasets employed and institutional aspects such as model maintenance and dissemination of results a typology of models is provided by structuring the assessment along a clear set of evaluation criteria

farm strategy self selection and productivity can small farming groups offer production benefits to farmers in post socialist romania abstract this paper addresses two questions why are romanian farmers continuing to place land in cooperative forms of farming when theory suggests that private farming is more productive and are there efficiency gains to be had from cooperative farming endeavors results from an econometric selection model suggest that smaller endogenously developed farming cooperatives such as family societies provide benefits over private farming strategies under certain conditions this paper questions the wholesale rejection of cooperation around production and challenges policy to move away from the typically dichotomized presentation of agrarian structure as being a trade off between private small scale farming and large scale collective farming

the impact of china s economic reforms on agricultural productivity growth this paper presents a method for assessing the relative importance of price increases and strengthened individual incentives due to the introduction of the responsibility system for the post 1978 increase in china s agricultural productivity data on post 1978 chinese agricultural performance suggest that a little over three quarters of the measured productivity increase is due to payment system changes and the remainder to price increases we also use our method to calculate incentive indices giving an estimate of the fraction of their marginal product that peasants received under the pre 1978 regime

the anatomy of government failure government failure is a much bigger problem than its contemporary treatment implies setting aside natural disasters most of the great catastrophes of human history have been government failures of one sort or another we argue that many so called market failures are government failures because government defines the institutions in which markets succeed or fail the concept of government failure has been trapped in the cocoon of the theory of perfect markets narrowly defined deviations from market perfection have been designated market failures for which government corrections may or may not really be a solution government failure in the contemporary context means failing to resolve a classic market failure we propose an alternative approach for evaluating whether government fails the pareto standard if an available pareto improvement is not chosen or is not implemented that is a government failure we organize government failure into two types substantive and procedural substantive failures include the inability or unwillingness to maintain order to maintain sound fiscal and monetary policies and to reduce risks of transaction costs which we classify as corruption agency and rent seeking procedural failures are inadequacies of available social choice mechanisms causing collective decisions to be arbitrary capricious or manipuated we conclude with some reflections on human rationality and the implications of behavioral economics

the virtues of gradualism and legitimacy in the transition to a market economy this paper presents a simplified model of sectoral restructuring in eastern europe a move towards allocative efficiency is desired by the reform minded government but the shift to higher productivity which such efficiency requires would lead to massive layoffs and labour reallocation in the transition period we look at the impact of political constraints unanimity and or majority worker approval on reform proposals when the government faces a heterogeneous workforce holding private information on relative outside opportunities when the budgetary consequences of exit compensations are so important as to make partial reforms preferable to full reforms gradualism emerges as the optimum in a dynamic context without government commitment it is also shown that under democratic majority rule a government in control of the agenda of reforms can win majority approval for plans which end up hurting majority interests intertemporally by threatening to switch majorities in future reform proposals this abstract was borrowed from another version of this item this abstract was borrowed from another version of this item

production organization and efficiency during transition an empirical analysis of east german agriculture enterprise restructuring is expected to improve efficiency in transition economies with data from former east germany we compare the efficiency of family farms and partnerships with large scale successor organizations of the collective and state farms lsos using parametric and nonparametric techniques we show that lsos display lower technical efficiency than do family farms and partnerships but that this difference is small and declining during transition mainly as a result of structural changes in agriculture family farms are not as scale efficient as partnerships and lsos and partnerships are superior to all other organizational forms

russian poverty muddling through economic transition with garden plots abstract household level analysis based on a comprehensive survey in three regions of russia sheds some light on new dimensions of poverty an important aspect of households responses to economic stress in the transition economy is home gardening and subsistence agriculture in urban and rural areas subsistence agriculture plays an important role in real income and food consumption of the middle income strata the income poor also tend to have poor plots and gardens household labor force distance to plots and opportunity costs of time are the main determinants of the level of labor allocation to household agriculture while on average marginal returns to labor in household plots are about 0 50 us day they are not different from zero for the poor agriculture policy neglects this sector which now provides almost 40 of russia s agricultural output

validating energy oriented cge models although cge models have received heavy usage they are often criticized as being insufficiently validated key parameters are often not econometrically estimated and the performance of the model as a whole is rarely checked against historical outcomes as a consequence questions frequently arise as to how much faith one can put in cge results in this paper we employ a novel approach to the validation of a widely utilized global cge model gtap e by comparing the variance of model generated petroleum price distributions driven by historical demand and supply shocks to the model with observed five year moving average price distributions we conclude that energy demand in gtap e is far too price elastic over this time frame after incorporating the latest econometric estimates of energy demand and supply elasticities we revisit the validation question and find the model to perform more satisfactorily as a further check we compare a deterministic global general equilibrium simulation based on historical realizations over the 2001 2006 period during which petroleum prices rose sharply along with growing global energy demands as anticipated by the stochastic simulations the revised model parameters perform much better than the original gtap e parameters in this global general equilibrium context

the nature of the farm abstract using a model based on a trade off between moral hazard incentives and gains from specialization this paper explains why farming has generally not converted from small family based firms into large factory style corporate firms nature is both seasonal and random and the interplay of these qualities generates moral hazard limits the gains from specialization and causes timing problems between stages of production by identifying conditions in which these forces vary we derive testable predictions about the choice of organization and the extent of farm integration to test these predictions we study the historical development of several agricultural industries and analyze data from a sample of over 1 000 farms in british columbia and louisiana in general seasonality and randomness so limit the benefits of specialization that family farms are optimal but when farmers are successful in mitigating the effects of seasonality and random shocks to output farm organizations gravitate toward fa

is private farming more efficient than socialized agriculture this paper examines the technical efficiency of state and private farms in poland for the period 1960 74 we find that the average technical efficiency of the two types of farms does not differ although the dispersion of efficiency levels is greater among state farms than among private ones we do find clear evidence of allocative inefficiency with state farms oversupplied with fertilizer and machinery

the design of reform packages under uncertainty the authors present a model of large scale economic reforms modeled on the transition process in eastern europe with aggregate and individual uncertainty concerning the outcome of reforms the government is assumed to choose the speed and sequencing of reforms the authors compare big bang strategies with gradualist reform packages they show that gradualist reform packages may be easier to get started optimal sequencing of reforms should aim at creating constituencies for further reforms and gradualism may generate a higher investment response because of a lower option value of waiting than would a big bang approach copyright 1995 by american economic association

rural reforms and agricultural growth in china this paper employs province level panel data to assess the contributions of decollectivization price adjustments and other reforms to china s agricultural growth in the reform period decollectivization is found to improve total factor productivity and to account for about half of the output growth during 1978 84 the adjustment in state procurement prices also contributed positively to output growth its impact came mainly from the responses in input use the effect of other market related reforms on productivity and output growth was very small reasons for slowdown in agricultural growth after 1984 are also analyzed copyright 1992 by american economic association

assessing alternative options for allocating oil revenue in iran abstract the present paper focuses on medium term effects of alternative windfall management strategies for a resource abundant country where the resource revenues are expected to last over a prolonged period in particular the trade off between spending and saving is analyzed within the framework of a recursive dynamic computable general equilibrium model the model is further validated against historical data available for 2001 2010 the total factor productivity is calculated endogenously in the model based on a function that reflects the changes in factor productivity the results suggest that saving oil revenues whether in an oil fund or through physical investment in domestic sectors leads to a higher economic growth however physical investment is superior in the short to medium term based on the resultant gdp while creating an oil fund might be more beneficial in the post oil era

variability in wheat export demand elasticity policy implications abstract agricultural economists and policy makers in the united states believe that the magnitude of the export demand elasticity is one of the most important parameters used in farm policy decisions however past empirical estimates show wide variation in the size of the u s export demand elasticity reasons for this wide variation go beyond differences in model specification estimation methods and period of estimation to involve factors such as trade policies and changes in the supply and demand conditions of foreign countries in view of the continual variation in magnitude the elasticity of export demand should be viewed as a variable rather than as a parameter in this study u s wheat export demand elasticities are computed using a world wheat trade model the estimates show that the elasticities vary significantly over time they also reveal that elimination of trade barriers would more than double wheat export demand elasticities

the impact of positive agricultural income shocks on rural chinese households in the post collectivization period rural chinese households were required to sell part of their grain output to the state at a below market price however increases in this quota price beginning in 1993 generated substantial positive income shocks these income shocks also varied cross sectionally in accordance with crop composition given that quotas were systematically larger for rice producing households generating a quasi random source of variation in the size of the shock driven by climatic variation in suitability for rice cultivation households induced to experience relatively larger income shocks show evidence of decreased agricultural investment increased investment in non agricultural businesses and increased migration as households gain increased income consistent with the hypothesis that credit constraints may have constrained some households from entering non agricultural production ex ante in addition there is evidence that these households were concentrated among households who had not previously diversified out of agriculture

assessing global computable general equilibrium model validity using agricultural price volatility computable general equilibrium cge models are commonly used for global agricultural market analysis concerns are sometimes raised however about the quality of their output since key parameters may not be econometrically estimated and little emphasis is generally given to model assessment this article addresses the latter issue by developing an approach to validating cge models based on the ability to reproduce observed price volatility in agricultural markets we show how patterns in the deviations between model predictions and validation criteria can be used to identify the weak points of a model and guide development of improved specifications with firmer empirical foundations

the economics of agricultural decollectivization in east central europe and the former soviet union 1989 include both the privatization of agricultural production assets and the restructuring of state and collective farms farm restructuring and more specifically the breakup of large scale agricultural production units into individually operated farms a process we define as decollectivization differ considerably for the various ece and fsu countries differences in decollectivization can be observed across countries between regions within a country and over time we argue that these differences are not random this article identifies the factors that affect the decollectivization process and shows how they are consistent with empirically observed differences in agricultural decollectivization in ece and fsu countries the decollectivization process is a consequence of the decision of collective farm members to leave the collective production framework and start up individual farms factors affecting this decision are the expected productivity and profitability of individual farming relative to collective farming and the costs for individuals to leave the collective farm and start up an individual farm these costs are affected by land reform privatization and decollectivization regulations the relative productivity of individual versus collective farming depends on the distribution of collective farmers productivity the prereform average collective farm productivity and the advantages and disadvantages of individual farming compared to collective farming the literature on decollectivization identifies both advantages and disadvantages in collective production some of which would not extend beyond the transition period disadvantages include high transaction costs associated with the monitoring of labor and inefficiencies due to the right of

success and failure of reform insights from the transition of agriculture this paper analyzes the linkages between the reform strategies in transition countries and economic performance the authors focus on agriculture because of the sharpness of the policy changes fundamental differences among countries and relative simplicity of agricultural relationships the authors document post reform performance in the transition countries of asia and europe the authors show how a pricing reform and subsidy reductions b land rights reform and policies that affect farm restructuring and c the presence institutions that facilitate exchange either markets or market substitutes affect output and productivity the paper ends with general lessons on reforms and transition

land market imperfections and agricultural policy impacts in the new eu member states a partial equilibrium analysis this article analyses how transaction costs and imperfect competition in the land market affect the welfare effects of agricultural subsidies in the new eastern member states of the european union benefits of land subsidies end up with landowners in new eastern member states also with imperfections in the new eastern member states land markets with unequal access to subsidies small tenant farmers may even lose out from the subsidies decoupling of payments shifts policy rents to farmers but constrains productivity enhancing restructuring using reserve entitlements to mitigate this effect reduces the intended benefits on distortions and target efficiency

economic analysis of an aviation bioenergy supply chain abstract this study develops a regional economic model that can mimic stages of a potential aviation fuel supply chain based on the oilseed camelina a general equilibrium model is developed that accounts for key sectors of the supply chain and is parameterized using detailed data for the pacific northwest region of the united states model scenarios are developed to evaluate the potential effectiveness of policies that would promote the development of the supply chain while the existing low price of conventional fuel makes camelina based fuel economically infeasible at present the supply chain could be viable if consumers e g airline passengers are willing pay more to use the biofuel such as if they perceive an environmental benefit from it alternatively if use of the oilseed is consistent with the energy policy priorities of policymakers one of the following approaches could potentially work a 17 subsidy on the alternative fuel a 20 tax on the conventional fuel or a combination 9 subsidy on the alternative and 9 tax on the conventional fuel implications for economic efficiency regional employment and economic welfare are quantified

local food prices and international price transmission world food prices spiked in the periods 2007 8 and 2010 11 the impact of these spikes in world food prices on local food prices and thus on local consumers is determined by the food price pass through pass through is defined as the extent to which changes in world food prices lead to changes in local food prices we examine the determinants of variation in food price pass through from global to local consumer prices in a global sample of 147 countries using fao data on world food prices and ilo data on food prices for consumers while market integration matters our study finds that income per capita is the dominant factor explaining cross country variation in pass through of food prices we estimate an elasticity of about 0 3 of pass through with respect to income per capita this means far greater price transmission of food price shocks at the commodity level to final consumers in low income countries than in high income countries the implication is that future swings in world food prices will in particular jeopardize food security in poor countries trade policy measures of market integration also affect the pass through significantly whereas infrastructure and geography measures play no significant role

total factor productivity change in china s farming sector 1952 1989 a crucial problem in economic development is choosing institutions that are relatively efficient in resource allocation and conducive to growth however institutional innovations usually take time and it is often difficult to isolate these effects from the effects of noninstitutional factors modern china is one of the few exceptions it offers a rich experience in dramatic institutional changes after 1949 a smallholder system was experimented with immediately after the land reform this was quickly followed by various forms of collectivization since 1979 the household responsibility system hrs has gradually replaced the commune system thus china provides a unique opportunity for a comparative study of these different rural institutions in terms of the total factor productivity index tfpi this index measures the change in output relative to the change in inputs the examination of the tfpi also has policy implications the apparent plateau in grain production and the slow growth in other crop production from 1985 to 1989 constitute a sharp contrast to the period 1979 84 which witnessed rapid growth in both grain and economic crop production in china public ownership is favored by orthodox ideology and noneconomic factors often play an important role in economic life 2 in facing slower growth in crop production whether the hrs should or should not be the long term rural institution has become a sensitive question again and has kindled a heated debate within china in this study i will examine the performance of the successive rural institutions in china in terms of changes in the tfpi over the period 1952 89 using 1989 as the final year of my study the most important finding of this study is that the hrs showed a clear advan

recent and prospective adoption of genetically modified cotton a global computable general equilibrium analysis of economic impacts abstract this article provides estimates of the economic impact of initial adoption of genetically modified gm cotton and of its potential impacts beyond the few countries where it is currently common use is made of the latest version of the gtap database and model our results suggest that if other developing countries especially in sub saharan africa were to follow the lead of china south africa and most recently india adoption of gm cotton varieties could provide even larger proportionate gains to farmer and national welfare than in those early adopting countries furthermore those estimated gains are shown to exceed and reinforce those from a successful campaign under the wto s doha development agenda to reduce remove cotton subsidies and import tariffs globally

a north american free trade agreement analytical issues and a computational assessment abstractthe following sections are included introductionissues in analyzing the economic impact of the naftathe computational modelcomputational resultsconclusionsstudy questionsreferencessuggested further reading this abstract was borrowed from another version of this item

global models of trade in agriculture and related environmental modelling a review and assessment the continuing process of global integration bears implications for farmers and related supplying and processing industries in all parts of the world but also for the rest of the world economy an assessment of agricultural and trade policy impacts is bound to be complex and is often supported by quantitative modeling analysis this article provides an assessment of the present state of applied modelling in the area of trade and agricultural policies we provide in this paper a comparative assessment of alternative modelling approaches considering a total of 16 partial equilibrium and general equilibrium models the assessment includes theoretical modelling foundations datasets employed and institutional aspects such as model maintenance and dissemination of results a typology of models is provided by structuring the assessment along a clear set of evaluation criteria

the impacts of india s food security policies on south asian wheat and rice markets we quantify the extent to which india s success in stabilizing its wheat and rice markets affects other countries in south asia we deal with the variability of indian trade and price policies by a

responsiveness flexibility and market liberalization in china s agriculture been at most only limited gains from market liberalization if one were to take the findings of this admittedly scant literature seriously it would appear as if there is at most only a relatively small impact from market reforms in china we believe there are three possible but only one plausible explanations for the findings first if market liberalization actually contributes little to no growth or increases in output or incomes this would of course in part explain why economies that lead reform with market liberalization do not experience significant gains theory and the experiences of other economies in other settings however would argue against such an interpretation second it could be that china s agricultural market liberalization has just proceeded so slowly that it is still too early for output to have been positively affected by market liberalization however as seen above the record on the market expansion and the observations of many researchers would not support this view

collective agricultural production a solution for transition economies abstract the paper examines theoretical reasons and provides examples for productivity differences between agricultural service cooperatives and collectives service cooperatives can utilize economies of scale enhance competitiveness and provide technical information advantages that often outweighed problems of free riding low investment and excessive political intervention agricultural collectives while not adding substantial advantages are in addition associated with problems of supervision and effort supply tendencies to substitute casual workers or mechanization for regular members and low investment incentives while collective forms of organization in transition economies respond to high risk and market imperfections they do so inefficiently policies that create conditions for service cooperatives to compete may lead to large productivity gains

completing china s move to the market beginning in late 1978 by luck as much as design china arrived at a strategy for market oriented economic reform that combined substantial reform with rapid growth in gdp and exports the sequencing of reform began with the easy to reform sectors agriculture and foreign trade and then took up the more difficult task of reforming the large state owned enterprises with respect to agriculture small scale industry and foreign investment china found ways of introducing meaningful property rights into the increasingly marketized system a partially unreformed financial system and inadequate autonomy of large state enterprises accounts however for the current stop go nature of chinese development

international real business cycles we ask whether a two country real business cycle model can account simultaneously for domestic and international aspects of business cycles with this question in mind we document a number of discrepancies between theory and data the most striking discrepancy concerns the correlations of consumption and output across countries in the data outputs are generally more highly correlated across countries than consumptions in the model we see the opposite

how to reform a planned economy lessons from china the countries of eastern europe and the former soviet union have been flooded with advice from the west on how to liberalize their planned econo mies this advice is unfortunately offered in an empirical vacuum no one knows how these econo mies will react to the proposed liberalization meas ures there exists however a neglected source of information china offers a long time series of data over a decade s worth on the effects of reforms on a planned economy china s reforms were gradual but their cumulative effect has been large and they have been remarkably successful china s experiments provide some practical les sons on what kinds of reforms can work elsewhere the dominant school of thought among economists favours the big bang policy of reforming quickly and according to a comprehensive plan partial reforms in this view are useless they will be negated by the remnants of the planning system the proponents of big bang reform have been influential with poland czechoslovakia and rus sia announcing plans for a rapid transition to capi talism