household level spillover effects from biofuels evidence from castor in ethiopia the indirect effects of biofuels are mostly considered negative in this paper we argue that there may be a positive indirect effect of biofuels on food security and poverty using micro level evidence and a matched plot pair design through which we control for plot and farmer characteristics we show that the introduction of castor production for biofuel in a poor country as ethiopia can significantly improve food productivity of rural households who produce raw material for biofuel production this spillover seems particularly linked to enhanced access to inputs and technical assistance which were provided as part of biofuel feedstock production contracts our results thus document another mechanism through which biofuels may influence smallholders food security a mechanism that did not receive attention so far

threshold effects in price transmission the case of brazilian wheat maize and soya prices recent studies into price transmission have recognized the important role played by transport and transaction costs threshold models are one approach to accommodate such costs we develop a generalized threshold error correction model to test for the presence and form of threshold behavior in price transmission that is symmetric around equilibrium we use monthly wheat maize and soya prices from the united states argentina and brazil to demonstrate this model classical estimation of these generalized models can present challenges but bayesian techniques avoid many of these problems evidence for thresholds is found in three of the five commodity price pairs investigated

product and price competition in a duopoly this paper examines the role of consumer preferences costs and price competition in determining the competitive product strategy of a firm in the model studied here there are two identical firms competing on product quality and price they face consumers who prefer a higher quality product to a lower quality product but differ in how much they are willing to pay for quality the consumers can also choose a substitute if they don t like the product price offerings of the two firms for the firms a higher quality product costs more to produce than a lower quality product the paper shows that the equilibrium strategy for each firm should be to differentiate its product from its competitor with the firm choosing the higher quality choosing the higher margin as well this differentiation however is not efficient that is it is possible to choose two other products and offer them at prices that cover their marginal cost and still satisfy consumers needs better in the aggregate a monopolist by contrast would differentiate his product line efficiently this suggests that cannibalization has different effects on product strategy than competition the paper also shows that if one firm enters the market first then it can defend itself from later entrants and gain a first mover advantage by preempting the most desirable product position

distinguishing between equilibrium and integration in spatial price analysis this article introduces a new spatial price analysis methodology based on maximum likelihood estimation of a mixture distribution model incorporating price transfer cost and trade flow data this method permits differentiation between market integration and competitive market equilibrium and derivation of intuitive measures of intermarket tradability competitive market equilibrium perfect integration segmented equilibrium and segmented disequilibrium one can also use these estimates to derive semiparametric measures of time varying regime probabilities to track changing market conditions an application to trade in soybean meal among pacific rim economies demonstrates the usefulness of the method copyright 2002 oxford university press

the ethiopian commodity exchange and spatial price dispersion abstract in this article we study the impact of an institutional intervention on market efficiency in ethiopia more specifically we analyze to what extent the ethiopian commodity exchange ecx in combination with regional warehouses have contributed to a reduction in price spreads between regional markets our hypothesis is that warehouses connected to the ecx reduce the dispersion between export prices and local retail prices in different coffee growing areas as well as the dispersion between export prices and local retail prices in different coffee growing areas by doing so the ecx has the potential to improve the market efficiency to identify the causal effect we combine retail price data with information on the gradual rollout of warehouses connected to the ecx from 2007 to 2012 our results suggest that when two markets both have access to an operating warehouse the average price spread is 0 86 1 78 etb lower than it is for markets where at least one part lacks warehouse access this is a substantial reduction considering that the average price spread over the full period is 3 33 etb the main results are robust to various econometric specifications and our analysis thus suggests that local warehouses connected to the ecx have indeed improved market efficiency

determination of the international maize price what is the growing role of brazil and ukraine this paper examines the relationships among maize prices for four countries to determine if newly emerging exporters brazil and ukraine influence the international price of maize our work focuses on each market s participation in the price discovery process rather than trying to determine a price leader we find that the united states plays the largest role in price discovery followed by argentina brazil and ukraine we also search for export thresholds and find that ukraine s contribution to price discovery rises slightly when an export threshold of 2 3 million tons is reached no export thresholds were found for brazil export thresholds for argentina were found but only have a minor impact on price relationships we also found that price relationships vary considerably across seasons of the year

examining crop price effects on production decision and resource allocation an ex ante approach this article examines the output price effects on the us crop production employing an ex ante approach to the differential systems of input demand and output supply the estimation results of the

estimating the degree of market integration existing tests of spatial market integration are commonly based on statistical criteria without an explicit link to an economic model of price determination this article proposes new measures of market integration defined directly in terms of a well known spatial price determination model and develops an econometric methodology for estimating these measures due to the intractability of the conditional density function of prices we use indirect inference to estimate the model parameters and market integration measures the methodology is illustrated with simulated data and is applied to soybean price data for the united states brazil and the eu copyright 2008 oxford university press

market integration and price transmission in consumer markets of developing countries abstract world prices for agricultural commodities surged in 2006 08 and then again in 2011 12 in many developing countries consumer prices for staple foods such as bread and rice mirrored these movements this paper examines whether prices in urban consumer markets within developing countries are co integrated with prices in world agricultural commodity markets using a single equation error correction model we examine the response of consumer prices for wheat rice maize and sorghum to changes in world market prices and exchange rates in urban centers of the developing world analyzing over 60 country commodity pairings we find that developing countries consumer markets are co integrated with world markets yet we also find that the transmission of changes in both world prices and real exchange rates to domestic consumer prices is not high and that the movement of domestic consumer prices to new equilibrium with world prices after a shock to the latter is relatively slow

accessing modern science policy and institutional options for agricultural biotechnology in developing countries the paper highlights the complexity of the challenge in developing forms of collaboration between a variety of actors in the biotechnology area in developing countries national research systems with diverse capacities in biotechnology international research centers local private research and development companies and advanced research institutes in both industrialized and developing countries case studies are provided from strong programs such as india china and brazil which will be tool developers as well as users programs that are developing an adaptive capacity in biotech to use tools and methods in a large number of countries whose research systems have virtually no capacity in molecular biology each type program presents challenges and opportunities for accessing new technologies based on facilitation of private investments public private partnerships and local capacity to design proprietary technologies working with the consultative group on international agricultural research centers as intermediaries and partners and with regional consortia policy and institutional issues for accessing modern science are then discussed and many of the challenges involve developing strategies in intellectual property management while pubic research organizations will need to develop innovative means of segmenting markets to complement private sector interests

quality quantity and spatial variation of price this paper develops and implements a method for estimating price elasticities of demand using cross sectional household survey data geographically clustered households report unit values which when corrected for quality effects and for measurement error indicate the underlying spatial variation in prices and can be matched to variation in demand patterns a simple model of quality choice is proposed while the correction for measurement error exploits the clustered design of such surveys data from a 1979 household survey from the ivory coast are used to estimate price elasticities for beef meat fish cereals and starches copyright 1988 by american economic association

carving up the commons emergence of a new international regime for germplasm development and transfer no nation has ever fabricated or maintained a prosperous food system based on genetic resources of purely indigenous origin remarkably many countries now seem ready and almost eager to try such an approach we identify four separate components of an emerging regime that are interacting in ways that should worry everyone concerned with the development and transfer of plant genetic materials into the south new provisions on intellectual property increased concentration of new enabling technologies into a few large multinational companies heightened anxieties over transgenic crops and new problems arising from international agreements we argue that the solutions now being discussed in global forums are either infeasible incomplete or are likely to have seriously negative effects we call instead for creative new thinking on building human capacity in developing countries on the legal status of plant genetic resources and on publicprivate partnerships especially those in service of the poor 2002 published by elsevier science ltd

targeted export promotion with several oligopolistic industries abstract we study export promotion policies in situations where several oligopolistic industries compete for the services of a sector specific factor of production the partial equilibrium argument for strategic subsidies must be modified to incorporate general equilibrium effects working through the factor market we find that these effects generally weaken the case for profit shifting subsidies in a benchmark case with symmetric exporting industries fixed coefficients technologies and an inelastic supply of the specific factor free trade is shown to be optimal

location choice product proliferation and entry deterrence within a slightly modified version of hotelling s model we reconsider the claim that the threat of entry induces existing firms to produce a larger number of products than they would otherwise we show that entry deterrence although optimal need not be achieved through product proliferation in some cases the incumbent monopolist resorts to an entry deterring strategy based on location choice rather than product proliferation we also show that in some cases the number of products chosen by the incumbent facing the threat of entry is strictly greater than the minimum number required to deter entry

the welfare analysis of product innovations with an application to computed tomography scanners the main goal of this paper is to put forward a methodology for the measurement of product innovations using a value metric that is equating the magnitude of innovations with the welfare gains they generate this research design is applied to the case of computed tomography scanners a revolutionary innovation in medical technology the econometric procedure centers on the estimation of a discrete choice model the nested multinominal logit which yields the parameters of a utility function defined over the changing quality dimensions of the innovative product the estimated flow of social gains from innovation is used to compute a social rate of return to r d to explore the interrelation between innovation and diffusion and to trace the time profile of benefits and costs the latter suggesting the possible occurrence of technological cycles

a review of the ecological and socioeconomic effects of biofuel and energy policy recommendations abstract many countries have attached great emphasis on biofuel because it is universally acknowledged renewable and sustainable however there remain doubts regarding biofuel s renewability cleanliness and ecological friendliness in addition its impacts on income employment and food security have been widely discussed therefore the effect of developing biofuel as an important method of resolving the energy crisis and climate change is questioned based on the rocketing concern on the multiple effects of biofuel this paper provides a comprehensive and updated review of the literature on biofuel s ecological effects and socioeconomic effects the literature included in this paper is selected english language papers being published since 2004 we find that existing studies have not arrived at a consensus regarding the ecological or the socioeconomic effects of biofuel there remain uncertainty and doubts toward biofuel s renewability and cleanliness biofuel s impacts on water and biodiversity are also questioned although biofuel is widely regarded to have positive impacts on income and employment many studies prove that biofuel influences food security negatively besides biofuel s economic cost is likely to be the barrier to its promotion because of the uncertainty of biofuel s impacts this study recommends cautious attitude toward biofuel development especially for those countries where biofuel development would be inappropriate and suggests that policy makers engage in demand side management instead of unsustainable supply side management

can the public sector meet the challenge of private research commentary on falcon and fowler and pingali and traxler abstract the growth of private sector participation in agricultural research has serious implications for pro poor technology development but there are other factors that must be considered new plant varieties are not the only things standing between resource poor farmers and secure livelihoods and institutional strengthening is also necessary in addition the current state of public agricultural research is cause for concern it is not clear how many effective public private partnerships can be formed the public sector needs a much clearer definition of its targets and priorities and funding strategies for national and international agricultural research must be overhauled

an analysis of the impact of open entry on price and the quality of service in the airline industry d uring the past three years there has been a gradual transition toward deregulation of the airline industry by the civil aeronautics board cab as originally proposed in the federal aviation act of 1975 and finally enacted in the airline deregulation act of 1978 this move is intended to allow for competitive pricing and freedom of entry and exit in the domestic airline markets during 1981 so far the price competition has been restricted by the cab to the offering of discount and standby fares the impact on price has been a reduction in revenue per passenger mile from 8 24 in 1977 to 8 02 in june of 1979 1 over this same period the quality of service has declined as measured by an increase in the load factor from 56 1 to 63 6 this result is consistent with most predictions regarding the impact of price competition in this industry 2 alfred kahn 1978 has argued that price competition by itself would and should result in a variety of services for consumers but that it could reduce the average quality of service via higher load factors price competition is however only one dimension of a fully competitive airline market while price competition will certainly tend to increase load factors the effect of entry should be to lower them as firms compete through scheduling frequency the interaction between these forms of competition produces a technical tradeoff between lower prices and higher quality of service and thus raises the question of what a truly competitive airline market will provide the consumer of airline services this paper examines this intrinsic tradeoff between price and quality in the provision of airline service and analyzes the implications for a competitive airline industry the presence of this tradeoff has been suggested in the theoretical models of douglas and miller 1974b and devany 1975 in both models there is purported to be an inverse relation between the load factor and the number of firms in a market due to scheduling competition and an inverse relation between the load factor and the fare level due to profit maximizing supply responses of firms serving the market 3 it is these theoretical propositions that produce a tradeoff between fare level and the quality of service and make the effects of competition in the typical airline market difficult to predict using these theoretical models as a basis this paper develops an empirical analysis of the relation between fare level open entry and the quality of service and its implications for a competitive airline market this involves first estimating the equilibrium price and load factor which results from competition in a market with a fixed number of firms then the independent effect of open entry on the competitive market outcome is identified by varying the number of firms and examining the capacity response due to scheduling competition this analysis yields the zero profit price and load factor for varying degrees of market concentration jthe profitmaximizing and output maximizing price quality combinations are also generated for the same market conditions a comparison of these alternative market solutions provides the basis for analyzing the inherent price quality tradeoff in the provision of airline service and some insight into the nature of a fully competitive airline market crucial to the analysis proposed above is an empirical estimate of the supply response of firms serving a city pair market to changes in received for publication april 23 1980 revision accepted for publication april 15 1981 university of texas at arlington and southern university of new orleans respectively i these figures are computed using data on domestic trunk carriers in all u s markets they are taken from air transport 1979 2 this prediction follows from the generally accepted theoretical model as developed by devany 1975 and douglas and miller 1974b i douglas and miller 1974a b provide some empirical evidence of the inverse relation between the average load factor and the number of firms serving the market using a crosssection sample of city pair markets operating in the united states similarly devany 1975 provides some preliminary empirical tests of his model and finds the results to be generally consistent with these theoretical propositions

evaluating the integration of contiguous discontinuous markets this paper applies the concepts of structural models of markets market integration and market discontinuity to show that discontinuous markets alter the integration characteristics of continuous markets when analyzing systems of contiguous markets some of which are discontinuous it appears that the continuous markets are less well integrated when the discontinuous markets are operating than when they are not operating

global agriculture r d and the changing aid architecture agriculture research knowledge and technology that transcends national borders has played a crucial role in enhancing developing country productivity growth over the past 50 years the demand for international agriculture research iar continues to be strong today even while becoming increasingly differentiated by the stage of development that a particular country or region is in the supply of iar to developing country research programs is however becoming increasingly constrained by variable donor support a push toward downstream product adaptation and dissemination activities relative to innovation and product development and a lack of clear links between international public good research and national agriculture development priorities country level donor coordination and alignment mechanisms specified in the paris declaration on aid effectiveness do not explicitly account for the role of iar in the development process while the movement toward national ownership of its development agenda and donor alignment around it is unquestionably good an unintended consequence could be a break in the r d pipeline that supplies public good research and technologies for enhancing developing country agriculture productivity growth the article presents options for rebuilding synergies between international public good research and national agriculture development priorities

pro poor agricultural biotechnology can the international research system deliver the goods abstract while global investment in agricultural research by the private sector is increasing with growth in developing country markets and the emergence of new technologies complementary public sector investment is stagnating or declining in many developing countries this review argues that the changing roles of the public and private sectors in generating new scientific knowledge may adversely affect the diffusion of explicitly pro poor technologies technologies that are simultaneously yield enhancing and poverty reducing comparing historical evidence from the green revolution with recent evidence from the emerging era of agricultural biotechnology this review argues that a more pluralistic international system for agricultural research will be more responsive to poverty only if the strategic leadership role of the public sector is strengthened certain research functions are reallocated to the private sector and new policy and organizational mechanisms are used to stimulate pro poor research in and for developing country agriculture

biofuels and food security micro evidence from ethiopia abstract there is considerable controversy about the impact of biofuels on food security in developing countries a major concern is that biofuels reduce food security by increasing food prices in this paper we use survey evidence to assess the impact of castor production on poor and food insecure rural households in ethiopia about 1 3 of poor farmers have allocated on average 15 of their land to the production of castor beans under contract in biofuel supply chains castor production significantly improves their food security they have fewer months without food and the amount of food they consume increases castor cultivation is beneficial for participating households food security in several ways by generating cash income from castor contracts they can store food for the lean season castor beans preserve well on the field which allows sales when farmers are in need of cash or food spillover effects of castor contracts increases the productivity of food crops increased food crop productivity offsets the amount of land used for castor so that the total local food supply is not affected

u s airline deregulation its effects on passengers capital and labor his paper presents an analysis of the effects of airline deregulation on passengers business and personal first class and coach and explores how capital and labor have fared in a free market the evidence corroborates many benefits that proponents of deregulation predicted but it has not worked perfectly prices are not fully competitive and for certain dimensions service quality is down furthermore the contestability hypothesis as applied to the airline industry does not withstand statistical examination

gender implications of biofuels expansion in africa the case of mozambique summary we use a gendered dynamic cge model to assess the implications of biofuels expansion in a low income land abundant setting mozambique is chosen as a representative case we compare scenarios with different gender employment intensities in producing jatropha feedstock for biodiesel under all scenarios biofuels investments accelerate gdp growth and reduce poverty however a stronger trade off between biofuels and food availability emerges when female labor is used intensively as women are drawn away from food production a skills shortage among female workers also limits poverty reduction policy simulations indicate that only modest improvements in women s education and food crop yields are needed to address food security concerns and ensure broader based benefits from biofuels investments

how is the liberalization of food markets progressing market integration and transaction costs in subsistence economies we propose a modification of baulch s parity bounds model to measure the market integration of food markets in developing countries instead of extrapolating a single observation of transaction costs we estimate transaction costs predicted transaction costs compare well with survey data of traders probabilities of market regimes computed on the basis of predicted transaction costs fluctuate significantly and do not support fixed regime probabilities over time the probability of market integration with trade decreases consistently during food shortages increasing either the probability of no trade or loss making trade or the probability of profitable but unexploited trade opportunities the data further support a negative trend in market integration with trade

applied welfare economics with discrete choice models economists have been paying increasing attention to the study of situations in which consumers face a discrete rather than a continuous set of choices such models are potentially very important in evaluating the impact of government programs upon consumer welfare but very little has been said in general regarding the tools of applied welfare economics indiscrete choice situations this paper shows how the conventional methods of applied welfare economics can be modified to handle such cases it focuses on the computation of the excess burden of taxation and the evaluation of quality change the results are applied to stochastic utility models including the popular cases of probit and logit analysis throughout the emphasis is on providing rigorous guidelines for carrying out applied work this abstract was borrowed from another version of this item

ex ante analysis of the benefits of transgenic drought tolerance research on cereal crops in low income countries this article develops a framework to examine the ex ante benefits of transgenic research on drought in eight low income countries including the benefits to producers and consumers from farm income stabilization and the potential magnitude of private sector profits from intellectual property rights iprs the framework employs country specific agroecological drought risk zones and considers both yield increases and yield variance reductions when estimating producer and consumer benefits from research benefits from yield variance reductions are shown to be an important component of aggregate drought research benefits representing 40 of total benefits across the eight countries further estimated annual benefits of us 178 million to the private sector suggest that significant incentives exist for participation in transgenic drought tolerance research

the adoption of genetically modified papaya in hawaii and its implications for developing countries 1 abstract as agricultural biotechnology becomes increasingly commercialised numerous constraints limit adoption by developing country producers these include technology access impacts on farmers yields and profits privatisation of research and intellectual property biosafety regulatory frameworks and trade related market restrictions this essay analyses development of the genetically modified papaya and its commercialisation in hawaii as a response to a virulent plant disease papaya ringspot virus results of a survey of hawaiian papaya growers suggest that the unprecedentedly rapid adoption of gm papaya is due to this technology s having addressed many of these key constraints facing growers the implications for developing country adoption of gm varieties are explored

biofuels and the poor global impact pathways of biofuels on agricultural markets this study seeks to assess the future impacts of biofuel production on regional agricultural and related sectors over the next decade with a specific focus on the vulnerable regions of developing nations using a modification of the gtap modeling platform to account for the global interactions of regional biofuel and food markets the analysis shows that biofuel production levels depend on the assumption about the future price of energy and the nature of the substitutability between biofuels and petroleum based transport fuels low energy prices reduce the demand for biofuels and thus require greater government support to meet the desired production targets at the other extreme when prices are high and there is scope for substituting biofuels for petroleum based fuels the volume of biofuels produced will exceed the mandates even when biofuels are being mainly produced in developed countries our results indicate that there are impact pathways that extend far beyond the borders of the us brazil and the eu prices of feedstock and non feedstock commodities rise in developing countries there is also a rise in value added from the agricultural sector a gain that is enjoyed by the owners of land and labor including unskilled hence to the extent that agriculture is a key sector in getting growth started and addressing poverty needs the emergence of biofuels can in this way at least be a positive force

the grouping of stars an application to professional sports abstract this paper uses a two period model to analyze competition for high quality labor in a professional sports market leagues vertically differentiate their products by competing for the services of a small number of stars thereby endogenizing the cost of product quality if utility is linear or convex in the number of stars one league successfully employs all of them this grouping of stars results in an equilibrium market structure of either a monopoly or a duopoly depending on the opportunity costs of players and the number of consumers market efficiency of the resulting equilibrium is then discussed

can public private partnerships leverage private investment in agricultural value chains in africa a preliminary review summary public private partnerships ppps may be one way of increasing the level of private sector investment into poorly performing agricultural value chains this paper considers a range of ppp mechanisms that respond to different market failures affecting such chains and draws on principal agent theory to illustrate the challenges it reviews emerging experience with a number of these mechanisms along with experience from other sectors that may shed light on generic problems of implementing ppps in africa while finding some positive impacts on investment it notes that state failures can also undermine ppp effectiveness as the evidence base is still limited it calls on organizations promoting innovative ppps to disclose available information for critical examination

the potential benefits of herbicide resistant transgenic rice in uruguay lessons for small developing countries abstract in many developing countries the potential benefits from adopting a transgenic variety developed by a multinational corporation are limited by the crop s small production base this paper presents an ex ante evaluation of the economic impact of herbicide resistant transgenic rice in a small developing country uruguay to fully account for the multinational s market power the firm s seed markup is assumed to affect the adoption rate for the variety stochastic simulation techniques are employed to understand how potential benefits may vary with changes in technology yield costs and adoption parameters the results indicate a 1 82 million mean net present value for producers from the development and utilization of transgenic rice in uruguay and 0 55 million for the multinational these relatively small multinational firm benefits suggest that a firm will not undertake significant efforts to develop transgenic varieties adapted to local conditions without either strategic partnerships with local institutions or access to wider regional markets

a flexible parametric garch model with an application to exchange rates many asset prices including exchange rates exhibit periods of stability punctuated by infrequent substantial often one sided adjustments statistically this generates empirical distributions of exchange rate changes that exhibit high peaks long tails and skewness this paper introduces a garch model with a flexible parametric error distribution based on the exponential generalized beta egb family of distributions applied to daily us dollar exchange rate data for six major currencies evidence based on a comparison of actual and predicted higher order moments and goodness of fit tests favours the garch egb2 model over more conventional garch t and egarch t model alternatives particularly for exchange rate data characterized by skewness copyright 2001 john wiley sons ltd

market analysis methods are our enriched toolkits well suited to enlivened markets the past fifteen years have brought historic reduction of government intervention in agricultural markets in the developing world most economists and policy makers believe these reforms enliven markets previously fettered by excessive government authority nonetheless the impact of market oriented reforms on the spatial and intertemporal extent and the competitiveness of markets remains an inherently empirical question meanwhile there also have been major innovations in methods used to analyze markets and prices due largely to the rapidly emerging time series econometric literature agricultural economists toolkits have changed nearly as rapidly and dramatically as have developing economy markets but can these enriched toolkits answer the

biofuels and food security the biofuel market created the linkage between energy and agricultural market prices biofuel policies and energy prices set the floor price of feedstock prices and the energy prices and the upper limit of the biofuel blend ratio can decide the ceiling of feedstock prices on the other hand biofuels can also transmit price volatility from energy to agricultural markets despite not always being the cause of price volatility of feedstock and related agricultural commodity prices brazilian bioethanol can play a crucial role in stabilizing the sugar market one of the most crucial problems for increasing biofuel production is the competition with food and food related demand and agricultural resources the definition of competition between biofuels and food can be divided into two dimensions the competition with food and food related demand and the competition with the agricultural resources the feedstock of the second generation biofuels can compete with food and food related demand and agricultural resources the development of second generation biofuels may not solve the problems associated with the competition between biofuels and food however the competition between biofuels and food doesn t always have a negative impact on food security the competition and food security impact on different dimensions biofuels can contribute to agricultural and rural development and can have a positive impact on a national and sub national level but they can also have a negative impact on household levels in the same country international action is required to monitor whether biofuels can have a negative impact on food security and nutrition security at national sub national and household levels biofuels should be compatible with and must not threaten food security the fao in collaboration with other international organizations will have the responsibility of monitoring the impact of biofuels on food security and proposing policy recommendations to individual countries based on the results of the monitoring

the future of small farms trajectories and policy priorities summary while smallholder development has in the past led to reductions in poverty and hunger does this still apply in today s more globalized world this paper reviews the debates on the contemporary role of agriculture in development and the case for small farms in light of the rise of supermarkets lower commodity prices and liberalized trade agricultural research funding environmental change hiv aids and changing policy ideas although the answers vary greatly by context for many low income countries smallholder development remains a key option the policy agenda however has changed in addition to providing public goods the growing challenge is to overcome market failures which is largely a matter of institutional innovation

a note on pricing of hub and spoke networks abstract the difference between competitive and monopolistic pricing of airlines hub and spoke networks is examined it is found that under reasonable cost conditions pass through passengers pay lower prices per mile than those originating or ending at the hub thus higher per mile prices in large hubs do not necessarily signal market power

cointegration and spatial price transmission among wheat and wheat flour markets in afghanistan abstractthis article examines cointegration and spatial price transmission among afghan wheat and flour markets as well as their linkages with those of supplier countries and global markets unit root tests consistent momentum threshold autoregressive m tar models and vector error correction models asymmetric and symmetric are employed to achieve research objectives the results suggest that provincial wheat and flour markets may have a long run relationship with principal market of kabul afghan wheat and flour markets may also be cointegrated with their respective global kazakh and pakistani markets while provincial wheat markets might adjust to divergence from their long run equilibrium with kabul wheat market some of the provincial flour markets may not respond to deviation from their long run equilibrium with kabul flour market the speed of adjustment towards the long run afghan pakistani and afghan kazakh equilibrium may be faster for afghan flour than wheat markets the equilibrium adjustm

consequences of unintended food policies food price dynamics subject to the israeli palestinian conflict abstract israel s imposition of military security measures in the palestinian territories as a consequence of the long lasting violent conflict between them has negative economic effects on all parties concerned one crucial outcome is the limited ability to carry out trade which brings about welfare losses conflict induced policies such as security measures can result in sizable unintended externalities that shape the markets of and the trade in food we assess the dynamics of daily wholesale prices of food produced in israel and the west bank that is traded between them and is therefore subject to restrictions on movement to do so we suggest a regime switching cointegration model which is estimated using a novel extension of the johansen estimation method we find that the two major wholesale markets of the two regions are integrated with regard to these main trading products deviations from price equilibria are quickly adjusted the model suggests that movement restrictions temporarily cut off markets from each other implications of conflict induced closures for welfare depend on the direction of trade and are harming both palestinian and israeli consumers

the seed and agricultural biotechnology industries in india an analysis of industry structure competition and policy options since the late 1980s technological advances and policy reforms have created new opportunities for private sector investment in india s seed and agricultural biotechnology industries these changes have had a significant impact on cotton yields and output in india but less so for rice and wheat the country s main cereal staples for which yield growth rates are tending toward stagnation this analysis examines the structures of these industries their potential effects on competition and innovation and the policies that may improve both industry performance and the delivery of new productivity enhancing technologies to india s cereal production systems our findings suggest that more substantive policy reforms are needed to encourage further innovation reduce regulatory uncertainty and encourage firm and industry level growth while continued public spending on agricultural research is needed to support technological change

contestable markets an uprising in the theory of industry structure presents a transcript of the presidential address delivered at the 94th meeting of the american economic association on december 29 1981 discussion of developments in the theory of industry structure welfare attributes of contestable markets behavior characteristics of oligopoly equilibrium intertemporal vulnerability to inefficient entry ebsco

measuring the impact of road rehabilitation on spatial market efficiency in maize markets in mozambique this article analyzes the impact of road rehabilitation on the spatial market efficiency of maize markets in mozambique we estimate a modified version of the parity bounds model pbm that allows us to test the impact of road rehabilitation on spatial efficiency this article seeks to contribute to the existing literature in three ways first a unique data set where road rehabilitation episodes between market pairs are identified is developed second special care is devoted to estimation of transaction costs due to the sensitivity of the pbm model to the quality of transaction costs estimates finally as opposed to most existing literature that focuses on relatively distant markets the article focuses on spatially closed markets we find that maize markets tend to be segmented due to high transport costs following road rehabilitation inefficiency and average absolute price differentials tend to decrease and market pairs have tended to shift toward autarky regimes overall while the results point broadly toward a positive impact of road rehabilitation on spatial efficiency they are not as strong or as robust as one would like large increases in fuel prices likely offset the positive impacts of road rehabilitation on transaction costs contributing to the increase in the probability of being in an autarky regime

systems of innovation theory and the changing architecture of agricultural research in africa abstract this paper examines the on going evolution of the organisational architecture of agricultural research in africa once considered a rural backwater populated by agronomists extension agents and farmers agricultural research is now being explicitly placed within global debates about innovation technology institutions and development this is reflected in a growing interest in the use of systems of innovation theory to both understand and reform innovation processes within agriculture the basic argument put forward in the paper is that the conception of a global agricultural research system and associated efforts to create a coordinated multi layered supra national research infrastructure are at odds with both the realities of research at national level and the bio physical and socio economic heterogeneity that characterises rural africa it is suggested that a less directive approach to support for agricultural research is required to allow national characteristics and differences to come to the fore and to give more room for the development of the all important demand side

ambiguous changes in product quality economic goods are frequently sold according to a price per unit quantity where the quantity characteristic does not measure all the economically important characteristics of the good milk is sold by the quart automobiles rented by the mile physicians services bought by the visit and tennis lessons by the hour in all cases heterogeneous units are available in the market and the price per unit quantity depends upon the amount of the unpriced characteristic contained in each unit the per quart price of milk depends upon the butterfat content the mileage costs of automobile rentals on the cars make and the price per unit time for personal services on the providers skill and training the common distinction made between these variants of the same good is that they differ in quality where quality refers to the amounts of the unpriced attributes contained in each unit of the priced attribute thus milk is packaged according to the attribute milk liquid and the quality of milk refers to the ratio of butterfat per unit of liquid 2 this paper considers some of the unique aspects of the economics of supply and demand under this situation where products contain at least two desired attributes only one of which is quantified and measured prior to purchase product quality is here defined by the ratio of the second quality attribute per unit of the measured quantity attribute 3 this simple specification of quality allows a direct link between standard economic models of related products and the economics of variable product quality previous analyses which treat quality simply as a shift parameter in the demand function are shown to obscure the actual subtleties of supply and demand with variable endogenous quality 4 the paper proceeds by first examining the efficient quality and quantity and the competitive equilibrium the market equilibrium under monopoly is then contrasted in the second section the general theme of the

impact of bt cotton in china abstract a sample of 283 cotton farmers in northern china was surveyed in december 1999 farmers that used cotton engineered to produce the bacillus thuringiensis bt toxin substantially reduced the use of pesticide without reducing the output ha or quality of cotton this resulted in substantial economic benefits for small farmers consumers did not benefit directly farmers obtained the major share of benefits and because of weak intellectual property rights very little went back to government research institutes or foreign firms that developed these varieties farmers using bt cotton reported fewer pesticide poisonings than those using conventional cotton

on the extent of the market wholesale gasoline in the northeastern united states this paper develops the classical view of the extent of markets by introducing explicitly in the analysis the concept of arbitrage costs arbitrage or transaction costs imply that market boundaries are essentially stochastic while a set of products or regions may have binding arbitrage conditions i e may be in the same market at a given point in time they may not at another thus in defining a market the probability that a set of agents or regions would h3ve binding arbitrage conditions has to be assessed this paper develops an econometric methodology to estimate the transaction costs required to arbitrage among a given set of products as well as the probability that that set of products would be bound by binding arbitrage condi tions finally the methodology is applied to wholesale gasoline in the northeastern part of the united states address for communications pablo t spiller herbert hoover memorl l bldg 9348 stanford ca 94305

the politics of technological upgrading international transfer to and adaptation of gm cotton in argentina summary we describe patterns of international transfer to and adaptation of genetically modified gm cotton in argentina and ask whether political bargaining between the technology owner a multinational enterprise mne and host country actors may have influenced upgrading we suggest that the mne was able to use its exclusive capacity to upgrade gm cotton technologies as a negotiation tool to persuade host actors to change the rules that affected its multi lines of business in the country this implies wider policy scope to encourage technology upgrading host actors could negotiate over a wider range of aspects of interest to mnes

spatial integration at multiple scales rice markets in madagascar the dramatic increase in the price of rice and other commodities over the past year has generated new interest in how these markets work and how they can be improved this article uses an exceptionally rich data set to test the extent to which markets in madagascar are integrated across space at different scales of analysis and to explain some of the factors that limit spatial arbitrage and price equalization within a single country we use rice price data across four quarters of 2000 2001 along with data on transportation costs and infrastructure availability for nearly 1 400 communes in madagascar to examine the extent of market integration at three different spatial scales subregional regional and national and to determine whether non integration is due to high transfer costs or lack of competition the results indicate that markets are fairly well integrated at the subregional level and that factors such as high crime rates remoteness and lack of information are among the factors limiting competition

world market integration for export and food crops in developing countries a case study for mali and nicaragua using a generalized error correction model this article measures and compares market integration for export cash crops versus imported food crops for mali and nicaragua and computes transmission elasticities between changes in the goods border and domestic prices both mali and nicaragua obtain the bulk of their export revenue from a particular agricultural commodity cotton for mali and coffee for nicaragua and both import the same key staple food of rice to reap the economic gains from this trade specialization the two countries agriculture must be well integrated into world markets the two countries present an important policy contrast that affects their degree of world market integration and price transmission in mali a parastatal enterprise controls its cotton industry while nicaragua has less state direction over agriculture reflecting this difference the results show that for both its main export and import commodity nicaragua is more integrated into world markets and has higher price transmission than mali the results for nicaragua also show much higher integration and price transmission for its main agricultural export coffee than its major import rice

how integrated is the indian wheat market abstract applying the momentum threshold autoregressive m tar model due to enders and granger enders w and granger c w j 1998 unit root tests and asymmetric adjustment with an example using the term structure of interest rates journal of business and economic statistics 16 3 pp 304 311 this article examines the relationship between the various prices of wheat quoted at different market centres in four indian states we find evidence of m tar asymmetric adjustments of wheat prices indicating that price signals within states are transmitted over time in an asymmetric manner this type of price adjusting behaviour is consistent as to how price differentials may respond to poor dissemination of knowledge regarding market conditions and high transactions costs the results offer important policy implications

private sector incentives and the diffusion of agricultural technology evidence from developing countries abstractthe role of intellectual property rights iprs has been extensively debated in the literature on technology transfers and agricultural productivity growth in developing countries however few studies offer cross country evidence on how iprs affect yield growth by incentivising private sector investment in cultivar improvement we address this knowledge gap by testing technology diffusion patterns for six major crops using a unique dataset for the period 1961 2010 and an arellano bond linear dynamic panel data estimation approach findings indicate that biological and legal forms of iprs promote yield gap convergence between developed and developing countries although effects vary by crop

modelling trends in food market integration method and an application to tanzanian maize markets abstract pushed by increasing availability of price data and extensive market liberalisation efforts in many developing countries research on food market integration has evolved rapidly over the last two decades empirical methods to measure market integration diverged in two directions on the one hand there is the parity bounds model pbm using a switching regressions technique while on the other hand the use of threshold autoregressive tar models has been proposed this article provides a discussion on the two methods and argues that tar models are better able to capture the dynamics of the arbitrage process underlying interconnected markets furthermore we extend the standard tar model to include a time trend in both the threshold and the adjustment parameter using weekly maize price data on seven selected markets in tanzania we illustrate how both transaction cost and the speed of adjustment have changed during the nineties

quantity quality and the welfare effects of us airline deregulation in this paper we employ a method for estimationg quality adjusted demand to calculate measures of the change in consumer suruplus due to us airline deregulation the quality adjusted estimates of the price elasticity of demand indicate that consumers are from 25 to 50 more sensitive to changes in air fares than unadjusted estimates would suggest changes in unadjusted consumer surplus overstate the net welfare gains from deregulation by roughly a factor of two strongly suggesting that adjustments for quallity of service are essential to welfare analysis of regulatory changes in this industry

supplying crop biotechnology to the poor opportunities and constraints abstract unlike the public sector research that launched the green revolution private firms based in industrialised countries have done the majority of agricultural biotechnology research and almost all commercialisation of genetically modified gm crops this paper examines consequences of the emergence of a few large companies as leaders in the commercialisation of biotechnology by addressing issues of access to technology costs of conducting research and distribution of economic benefits to provide context we first review the status of crop biotechnology research globally who is benefiting from the technology we then analyse the role of intellectual property rights market access and industry concentration public sector research and gm crop biosafety regulations in determining observed r d by firms the paper recommends policy measures that allow transfer of current technology to the poor and generate more biotechnology research focused on problems of the poor

integrating bioenergy into computable general equilibrium models a survey in the past years biofuels have received increased attention since they were believed to contribute to rural development energy security and to fight global warming it became clear though that bioenergy cannot be evaluated independently of the rest of the economy and that national and international feedback effects are important computable general equilibrium cge models have been widely employed in order to study the effects of international climate policies the main characteristic of these models is their encompassing scope global models cover the whole world economy disaggregated into regions and countries as well as diverse sectors of economic activity such a modelling framework unveils direct and indirect feedback effects of certain policies or shocks across sectors and countries cge models are thus well suited for the study of bioenergy biofuel policies one can currently find various approaches in the literature of incorporating bioenergy into a cge framework this paper gives an overview of existing approaches critically assesses their respective power and discusses the advantages of cge models compared to partial equilibrium models grouping different approaches into categories and highlighting their advantages and disadvantages is important for giving a structure to this rather recent and rapidly growing research area and to provide a guidepost for future work

biofuel developments in mozambique update and analysis of policy potential and reality abstract climate change rising oil prices and concerns about future energy supplies have contributed to a growing interest in using biomass for energy purposes several studies have highlighted the biophysical potential of biofuel production on the african continent and analysts see mozambique as one of the most promising african countries favorable growing conditions and the availability of land water and labor are mentioned as major drivers behind this potential moreover the potential of biofuel production to generate socio economic benefits is reflected in the government s policy objectives for the development of the sector such as reducing fuel import dependency and creating rural employment this article provides an overview of biofuel developments in mozambique and explores to what extent reality matches the suggested potential in the country we conclude that biofuel developments mainly take place in areas near good infrastructure processing and storage facilities where there is skilled labor available and access to services and goods moreover our analysis shows the need to timely harmonize current trends in biofuel developments with the government s policy objectives as the majority of existing and planned projects are not focusing on remote rural areas and in absence of domestic markets principally target external markets

impacts of ethanol policy on corn prices a review and meta analysis of recent evidence abstract the literature on the impacts of biofuels on agricultural commodity prices is characterized by contradictory findings we review studies published between 2007 and 2014 that estimate the effects of u s corn ethanol policy on corn prices and find estimates ranging from nil to over 80 such divergent results make it difficult to assess the merits of alternative biofuel policies to bring more clarity to the issue and facilitate comparisons across studies we assemble a database of over 150 medium to long run estimates of the effect of corn ethanol production on corn prices from 29 published studies we first normalize corn price impacts by the change in corn ethanol volume to control for the large differences in ethanol quantities across scenarios we then conduct a meta analysis to identify the factors that drive the remaining variation in corn price impacts across studies in addition to ethanol volumes we find that modeling framework projection year inclusion of ethanol co products and biofuel production from other feedstocks explain much of the differences in price effects the results indicate that a one billion gallon expansion of the us corn ethanol mandate in the year 2015 would lead to a three to four percent increase in corn prices with smaller price changes projected in future years

australian beer wars and pub demand how vertical restraints improved the drinking experience recently australia s two largest brewers carlton and united breweries and lion nathan have been aggressively competing for market share in the state of victoria among other strategies the two breweries have implemented vertical restraints in the form of extensive agreements with retailers and the outright purchase of pubs a key outcome of these purchases and agreements is the renovation of many pubs as brewers attempt to attract increasingly sophisticated drinkers this paper attempts to quantify the value of these renovations and measure their associated impact on consumers relying on insights from the hedonic literature a simple but novel approach is used to estimate the implicit price of the pub environment and the effects of renovations on that price

global water crisis and future food security in an era of climate change food policy should serve humanity by advancing the humane goals of eradicating extreme poverty and hunger however these goals have recently been challenged by emerging forces including climate change water scarcity the energy crisis as well as the credit crisis this paper analyses the overall role of these forces and population growth in redefining global food security specifically global water supply and demand as well as the linkages between water supply and food security are examined the analysis reveals that the water for food security situation is intricate and might get daunting if no action is taken investments are needed today for enhancing future food security this requires action on several fronts including tackling climate change preserving land and conserving water reducing the energy footprint in food systems developing and adopting climate resilient varieties modernising irrigation infrastructure shoring up domestic food supplies reforming international food trade and responding to other global challenges

rent capture analysis of ontario s stumpage system using an enhanced parity bounds model we develop and use an enhanced parity bounds model epbm to examine the discrepancy between the stumpage price administratively determined under ontario s current stumpage pricing system and the market value of stumpage covering from june 1995 to january 2007 the results show that in the short run the stumpage prices were below or above the market values however in the long run the underpayment and overpayment will even out each other the results imply that ontario s stumpage pricing system has the ability to capture the full economic rents in the long run and the results also have other policy implications

a model of spatial arbitrage with transport capacity constraints and endogenous transport prices this article solves a high frequency model of price arbitrage incorporating storage and trade when the amount of trade is limited by transport capacity constraints in equilibrium there is considerable variation in transport costs because transport costs rise when the demand to ship goods exceeds the capacity limit this variation is necessary to attract shipping capacity into the industry in turn prices in different locations differ by a time varying amount thus while the law of one price holds it holds because of endogenous variation in transport costs

market integration efficiency of arbitrage and imperfect competition methodology and application to u s celery this paper develops and applies a methodology to test for efficiency of interregional commodity arbitrage application of the methodology requires only time series data on prices for alternative cities regions countries or product forms yet the approach is capable of generating evidence on a number of market parameters including market integration arbitrage efficiency the magnitude of marketing margins product substitutability and competitiveness of markets estimation is based on a switching regression model with three regimes efficient arbitrage relative shortage and relative glut results from application of the model to u s celery marketing indicated significant departures from efficient arbitrage for both california and florida celery

changing locus of agricultural research will the poor benefit from biotechnology and privatization trends over the past decade the locus of agricultural research and development has shifted dramatically from the public to the private multinational sector three interrelated forces are transforming the system for supplying improved agricultural technologies to the world s farmers the first is the strengthened and evolving environment for protecting intellectual property in plant innovations the second is the rapid pace of discovery and growth in importance of molecular biology and genetic engineering finally agricultural input and output trade is becoming more open in nearly all countries these developments have created a powerful new set of incentives for private research investment altering the structure of the public private agricultural research endeavor particularly with respect to crop improvement

testing market integration a model of spatial price differentials for a tradable good is proposed which avoids the inferential dangers of received methods using static price correlations the proposed method also extracts more information on the causes of price differentials from the same data the method is illustrated using monthly rice price data for postindependence bangladesh including the very substantial regional price shocks during the 1974 famine impediments to market integration are indicated

testing for food market integration revisited this article considers the statistical performance of four commonly used econometric tests for market integration the law of one price the ravallion model cointegration and granger causality a spatial price equilibrium spe model that is subject to both production shocks and general price inflation and mimics many of the key characteristics of integrated food markets is constructed the model is used to generate food price time series of lengths that are typical of the short sample sizes available in most developing countries for both instantaneously integrated and independent markets a series of monte carlo experiments on these artificial food price time series are performed which show that all four of the conventional tests for market integration are statistically flawed

recent developments in intellectual property and power in the private sector related to food and agriculture the legal protection of intellectual property ip has allowed private persons and enterprises to assert exclusive rights in relation to certain agricultural innovations whether through the protection of breeding innovations under plant variety rights protection laws or through the patenting of genes and gene fragments the increasing involvement of iprs in agriculture has effected a shift of agricultural research from public to private institutions this article examines the changes in the international ip landscape which has facilitated these developments and looks at the impacts of modern ip developments upon agricultural research and farmers it concludes with a consideration of ip liability issues arising from the development of gm agriculture

the impact of biofuel growth on agriculture why is the range of estimates so wide the rapid expansion of biofuel production has generated considerable interest within the body of empirical economic literature that has sought to understand the impact of biofuel growth on the global food economy while the consensus within the literature is that biofuel emergence is likely to have some effect on future world agricultural market there is a considerable range in the estimated size of the impact despite the importance of this topic to policy makers there has been no study that has tried to reconcile the differences among various outlook studies this paper undertakes an in depth review of some key outlook studies which quantify the impacts of biofuels on agricultural commodities and which are based on either general equilibrium ge or partial equilibrium pe modeling approaches we attempt to reconcile the systematic differences in the estimated impacts of biofuel production growth on the prospective prices and production of three major feedstock commodities maize sugar cane and oilseeds across these studies despite the fact that all models predict positive impacts on prices and production there are large differences among the studies our findings point to a number of key assumptions and structural differences that seem to jointly drive the variations we observe across these studies the differences among the pe models are mainly due to differences in the design of scenarios the presence or absence of biofuel trade and the structural way in which agricultural and energy market linkages are modeled the differences among the ge models are likely to be driven by model assumptions on agricultural land supply the inclusion of the byproducts and assumptions on crude oil prices and the elasticity of substitution between petroleum and biofuels