a comprehensive analysis of farmland value determination a county level analysis this study develops a comprehensive model of farmland value determination to analyze the effects of various economic variables such as net farm income government payments macroeconomic factors and demographic conditions on farmland values for the counties along the snake river valley in idaho land values net farm income and population show considerable variation among the counties therefore use of county level cross sectional and time series data helps to assess the impacts of various factors on land values more accurately the empirical results show that net farm income wheat yield population and credit availability have positive effects and property tax rates interest rates and debt to asset ratio have negative effects on farmland values

evaluating a stochastic programming based bidding model for a multireservoir system hydropower producers need to schedule when to release water from reservoirs and participate in wholesale electricity markets where the day ahead production is physically traded a mixed integer linear stochastic model for bid optimization and short term production allocation is developed and tested through a simulation procedure implemented for a complex real life river system the stochastic bid model sees uncertainty in both spot market prices and inflow to the reservoirs the same simulation procedure is also implemented for a practice based deterministic heuristic method similar to what is currently used for bid determination in the industry and the results are compared the stochastic approach gives improvements in terms of higher obtained average price and higher total value than the deterministic alternative it also performs well in terms of startup costs in the presence of river flow travel delay the practice based method is even more outperformed by the stochastic model

export demand us farm income and land prices 1945 1985 the growing openness of the u s economy has caused world supply and demand conditions to have significant farm level impacts emphasizing the important macroeconomic linkages between capital goods and factor markets in agriculture schuh 1983 this study considers the linkage from the international grain market to u s farm income in the post war period 194985 this linkage suggests that export demand may also have played an important role affecting land and other input prices through the derived demand relationship burt 1986 phipps 1984 and robison lins and venkataraman 1985 have each shown that land prices are closely tied to real and expected net returns to farming this study seeks to supplement their findings by examining the relative role of exports in determining these returns over time empirical results clearly show the export farm income connection the further linkage to land values while present is somewhat less clear

environmental policy uncertainty and marketable permit systems the dutch phosphate quota program tradable permits are generally considered as an efficient instrument to regulate pollution by individual producers however uncertainty about changes in or possible discontinuation of the program could make individual farmers reluctant to invest in tradable permits this article uses the option approach to derive a theoretical model that shows the impact of policy uncertainty on investment in tradable quota the empirical assessment provides weak evidence for the existence of option values due to policy uncertainty for phosphate quota in swine production in the netherlands

optimal involvement in futures markets of a power producer this paper addresses the optimal involvement in a futures electricity market of a power producer to hedge against the risk of pool price volatility the considered trading horizon spans one whole year recognizing the highly uncertain nature of future pool prices a stochastic programming framework with recourse is used to model this decision making problem the resulting problem is a large scale mixed integer linear programming problem scenario reduction techniques are used to make this problem tractable risk is properly modeled using the cvar methodology results from a realistic case study are provided and analyzed some conclusions are finally drawn

the impacts of the tax deferred exchange provision on farm real estate values this study examines the effects of the section 1031 tax deferred exchange provision on agricultural land values the provision allows taxpayers to defer taxation for relinquished productive assets if a like kind asset is acquired within the allotted time of 180 days the analysis examines a set of 3 580 farm real estate transaction from 55 agricultural counties in indiana over the period 2003 2006 hedonic price analysis suggests that properties acquired under a like kind exchange are associated with a 1 32 price premium jel h23 q15

scenario reduction for futures market trading in electricity markets to make informed decisions in futures markets of electric energy stochastic programming models are commonly used such models treat stochastic processes via a set of scenarios which are plausible realizations throughout the decision making horizon of the stochastic processes the number of scenarios needed to accurately represent the uncertainty involved is generally large which may render the associated stochastic programming problem intractable hence scenario reduction techniques are needed to trim down the number of scenarios while keeping most of the stochastic information embedded in such scenarios this paper proposes a novel scenario reduction procedure that advantageously compares with existing ones for electricity market problems tackled via two stage stochastic programming

productivity growth in indian agriculture is there evidence of convergence across states this paper explores the question of convergence in total factor productivity tfp in agriculture across fourteen major agricultural states of india using a tornqvist theil index for tfp growth for the period 1973 1993 we find no evidence to support convergence to a single tfp level convergence after grouping the various states on the basis of their productivity performance we find that the high performing states show a gradual movement towards the trend whereas the low performing states generally show more volatility testing for long run convergence in levels of agricultural productivity we find evidence of conditional beta convergence after controlling for state specific factors and idiosyncratic year specific volatility the results are robust to alternative specifications of tests of unit root in panel data developed recently

does structure matter the impact of switching the agricultural policy regime on farm structures abstract this paper investigates the relationship between structural change in agriculture and a policy regime switch at the regional level using the agent based spatial and dynamic simulation model agripolis we simulate structural change for two different farm structures in response to a policy change results show that structural adjustment differs depending on the initial structure

bidding in sequential electricity markets the nordic case abstract for electricity market participants trading in sequential markets with differences in price levels and risk exposure it is relevant to analyze the potential of coordinated bidding we consider a nordic power producer who engages in the day ahead spot market and the hour ahead balancing market in both markets clearing prices and dispatched volumes are unknown at the time of bidding however in the balancing market the market participant faces an additional risk of not being dispatched taking into account the sequential clearing of these markets and the gradual realization of market prices we formulate the bidding problem as a multi stage stochastic program we investigate whether higher risk exposure may cause hesitation to bid into the balancing market furthermore we quantify the gain from coordinated bidding and by deriving bounds on this gain assess the performance of alternative bidding strategies used in practice

how productive is infrastructure a new approach and evidence from rural india there have been competing arguments about the effect of public infrastructure on productivity level based and debate based regressions often lead to different estimates to help reconcile this difference this article applies the gmm method to first test for causality to check for length of lagged relationships and the existence of reverse causality before specifying a final model and deciding the estimation procedure this approach is illustrated using a panel data set for india the results show that infrastructure development in india is productive providing supporting evidence to reverse the trend of declining investment in rural infrastructure

creating an enabling environment policy conditions for less favored areas abstract within the rural areas those with a low productive potential usually home to poor agricultural households with limited access to assets are often the core of rural poverty and under constant threat of resource degradation there is ample evidence that neither trickle down effects in high potential areas nor structural adjustment measures have generated much poverty reduction in these less favored areas lfas often due a lack of attention to the development of factor and commodity markets sustainable and pro poor development of lfas therefore poses formidable challenges and requires special measures to achieve an enabling institutional and policy environment it needs to be based on viable sources of growth that imply considerable investments in physical and human capital and appropriate technology recognize positive externalities and add equity and natural resource management concerns in a context of heterogeneity to establish policy conditions that favor such development the role of and experience with major policy interventions incentives and institutions relevant to lfas is reviewed and an attempt is made to generalize these findings to this effect the different interventions are grouped into three broad categories viz price and market policies public services and investment and institutions and governance while countries should adopt the relevant market and trade policies the case is made for greater awareness of the adverse impact these policies can have in lfas and on their poor and complementary policies and investments need to be put in place to buffer or offset adverse outcomes key complementary interventions include public investments in infrastructure human capital and technology to enhance the competitiveness of lfas and policies to improve their market access there is also need for appropriate phasing of policy and market reforms to give people time to adjust and effective safety nets to cushion loss of livelihood options

government spending growth and poverty in rural india using state level data for 1970 93 a simultaneous equation model was developed to estimate the direct and indirect effects of different types of government expenditure on ruralpoverty and productivity growth in india the results show that in order to reduce rural poverty the indian government shoul d give highest priority to additionalinvestments in ruralroads and agricul turalresearch these types of investment not only have much larger poverty impacts per rupee spent than any other government investment but also generate higher productivity growth apart from government spending on education which has the third l argest marginalimpact on ruralpoverty and produc

the changing roles of urban influence and agricultural productivity in farmland price determination between 2000 and 2010 inflation adjusted u s farmland values increased by over 80 this period of rapid price appreciation coincided with both the agricultural commodity price boom and the broader financial crisis this paper examines the degree to which the determinants of farmland prices changed over this period using a panel of farmland transfer declarations from 98 illinois counties hedonic price analysis demonstrates that the relative importance of urban influence decreased over this period while the relative importance of agricultural productivity increased the study carries important implications for farmers farmland owners and policy makers

the impact of decoupled payments on u s cropland values an extensive literature has shown that various farm programs may influence the value of farmland but other studies have not examined the cropland price effects of direct or decoupled payments separate from countercyclical payments this study uses nationally representative confidential field level panel data with farmer reported per acre land values we analyze the impact of decoupled and other farm program payments on farmland values using a fixed effects model and controlling for various factors that influence farmland values we find that an additional dollar of decoupled payments has a large and statistically significant impact on farmland values of about 18 per acre these results are comparable with similar studies undertaken in europe

economic assessment of concentrated solar power technologies a review abstract this paper surveys economic assessments of concentrated solar power csp technologies and finds two dominant assessment methods a majority of studies reported in the literature are based on the levelized cost of electricity lcoe while a small subset of studies consider time varying meteorological and electricity market conditions several studies argue that lcoe undervalues dynamic flexibility provided by thermal energy storage and does not consider revenue opportunities provided by electricity markets at different time scales as a result some studies find that both lcoe and revenue can in fact be conflicting metrics for certain designs and market conditions this review finds strong variations in lcoe and revenue estimates in the literature as comparisons between csp and other generation technologies e g fossil wind and photovoltaic are dictated by the chosen economic metric it is imperative that policy and investment decisions should carefully consider time varying effects and flexibility finally research directions are proposed to increasing the fidelity of economic assessments and to mitigate discrepancies

strategic bidding under uncertainty a binary expansion approach this work presents a binary expansion be solution approach to the problem of strategic bidding under uncertainty in short term electricity markets the be scheme is used to transform the products of variables in the nonlinear bidding problem into a mixed integer linear programming formulation which can be solved by commercially available computational systems the be scheme is applicable to pure price pure quantity or joint price quantity bidding models it is also possible to represent transmission networks uncertainties scenarios for price quantity plant availability and load financial instruments capacity reinforcement decisions and unit commitment the application of the methodology is illustrated in case studies with configurations derived from the 80 gw brazilian system

transaction costs and the present value puzzle of farmland prices 1 introduction farmland is by far the dominant asset in the u s agricultural sector s balance sheet accounting for about two thirds of the value of all farm assets usda various years the value of u s farmland was estimated at 593 billion on december 31 1994 or roughly 10 of total market capitalization for firms in the sp clark fulton and scott 1993 tegene and kuchler 1993 this is a puzzling result because the cdr pvm has been widely accepted and generally used for land appraisal purposes beyond this however there is surprisingly little consensus regarding the determinants of farmland prices pope et al 1979 robison and koenig 1992 stare 1995 a major reason for this lack of consensus may be the heterogeneity of the data sets used for empirical analysis different studies use different levels of aggregation different time periods and different land value and rent series hanson and myers 1995 for example use country level data whereas tegene and kuchler 1993 use regional data and just and miranowski 1993 use state level data hanson and myers 1995 use data from 1910 to 1990 shiha and chavas 1995 use data from 1949 to 1990 and brown and brown 1984 use data from 1968 to 1981 falk 1991 examines farmland values and gross cash rents whereas hanson and myers 1995 examine farm real estate values and residual returns to farm real estate another possible explanation for the lack of consensus about farmland pricing and the focus of the present study is the presence of market frictions our motivation for exploring the role that market frictions might play in determining farmland prices is both theoretical and empirical on the theoretical level market frictions drive a wedge between the price at which outsiders wish to buy land and that at which farmers wish to sell it the market price can be anywhere within this wedge and thus can easily deviate from its frictionless present value one can interpret this wedge as a band of inaction delta sup l delta supu inside which farmers neither buy nor sell land even in the face of changing expected returns the band is centered on the price that would prevail in the absence of transaction costs and its width is determined by the size of these costs on the empirical level a review of the literature reveals that the frictionless market assumption is not a realistic representation of how farmland is actually traded although the costs associated with trading many financial assets are small costs incurred in transferring ownership of farmland typically exceed 7 5 of the purchase price to explore the role of market frictions we use the pvm recently used by lence and miller 1999 which explicitly incorporates proportional transaction costs

multimarket optimal bidding for a power producer this paper considers a profit maximizing thermal producer that participates in a sequence of spot markets namely day ahead automatic generation control agc and balancing markets the producer behaves as a price taker in both the day ahead market and the agc market but as a potential price maker in the volatile balancing market the paper provides a stochastic programming methodology to determine the optimal bidding strategies for the day ahead market uncertainty sources include prices for the day ahead and agc markets and balancing market linear price variations with the production of the thermal producer results from a realistic case study are reported and analyzed conclusions are duly drawn

capitalization of government support in agricultural land prices what do we know abstract the objective of this paper is to provide an overview of existing literature both theoretically and empirically on the extent to which agricultural subsidies do translate into higher land values and rents and finally benefit landowners instead of agricultural producers our review shows that agricultural support policy instruments contribute to increasing the rental price of farmland and that the extent of this increase closely depends on the level of the supply price elasticity of farmland relative to those of other factors inputs on the one hand and on the range of the possibilities of factor input substitution in agricultural production on the other hand the empirical literature shows that land prices and rents have in general a significant positive and inelastic response to government support such inelastic response is thought to reflect the uncertain future of the farm programmes and in general studies have indicated that land prices are more responsive to government based returns than to market based returns

min max regret bidding strategy for thermal generator considering price uncertainty the electricity price volatility brings challenges to bidding strategies in the electricity markets in this paper we propose a minimax regret approach for a market participant to obtain an optimal bidding strategy and the corresponding self scheduled generation plans motivated by recently proposed robust optimization approaches our approach relies on the confidence intervals of price forecasts rather than point estimators we reformulate the minimax regret model as a mixed integer linear program milp and solve it by the benders decomposition algorithm moreover we design a bidding strategy based on the price forecast confidence intervals to generate the offer curve finally we numerically test the minimax regret approach in comparison with the robust optimization approach on three types of thermal generators by using real electricity price data from pjm to verify the effectiveness of our proposed approach

investment subsidies and pro poor growth in rural india this article reviews the trends in government subsidies and investments in and for indian agriculture develops a conceptual framework and a model to assess the impact of various subsidies and investments on agricultural growth and poverty reduction and presents reform options with regard to re prioritizing government spending subsidies in credit fertilizer and irrigation have been crucial for small farmers to adopt new technologies particularly during the initial stage of the green revolution in the late 1960s and 1970s but it is now investments in agricultural research education and rural roads that are the three most effective public spending items in promoting agricultural growth and reducing poverty

optimal response of a power generator to energy agc and reserve pool based markets the electric power industry all over the world is undertaking major regulatory and operational changes the understanding of power supply as a public service is being replaced by the notion that competitive markets constitute a more appropriate framework to supply reliable and cheap electric energy to consumers as mandated by ferc orders 888 and 889 this paper considers simultaneously energy agc and reserve markets in a pool framework it provides a tool to enable a power generator to determine optimally its degree of involvement in each one of these markets a real world case study is analyzed and results are presented

the inconsistency of land values land rents and capitalization formulas this paper examines relationships that exist between farm income land values and capital asset pricing theory using two commonly referenced data sets it is shown that land prices and land rents do not have the same time series representations a necessary condition for the simple capital asset pricing theory to hold this suggests that a fundamental rethinking of the way in which land prices are viewed and modeled is needed more complex models that allow for rational bubbles risk aversion and future shifts in government policy or commodity prices may be required

who really benefits from agricultural subsidies evidence from field level data if agricultural subsidies are largely capitalized into farmland values then expanding support for agriculture may not benefit farmers who rent the land they farm suddenly reducing subsidies may be problematic to the extent that land values already embody expectations about future subsidies existing evidence on the incidence of subsidies on land values is mixed identification is obscured by unobserved or imprecisely measured factors that tend to be correlated with subsidies especially land quality and time varying factors like commodity prices and adverse weather events a problem that has received less attention is the fact that subsides and land quality on rented land may differ from owned land since most farms possess both rented and owned acreage farm level measures of subsidies land values and rental rates may bias estimated incidence using a new field level data set that for the first time precisely links subsidies to land parcels we show that this bias is considerable where farm level estimates suggest an incidence of 20 to 79 cents of the marginal subsidy dollar field level estimates from the same farms indicate that landlords capture just 10 25 cents the size of the farm and the duration of the rental arrangement have substantial effects incidence falls by 5 15 cents per acre when doubling total operated acres and the incidence falls by 0 1 1 2 cents with each additional year of the rental arrangement low incidence of subsides on rents combined with the farm size and duration effects suggest that farmers renting land have monopsony power

the fischler reform of the common agricultural policy and agricultural land prices based on 7 300 agricultural land sales transactions we estimate the effect of the 2003 reform of the e u common agricultural policy on land prices as opposed to the main body of the literature on agricultural land values we do not start from a demand oriented net present value approach or hedonic pricing method but derive our reduced form pricing equation from a spatial land sales market model our empirical model accounts for spatial dependence and endogeneity of explanatory variables a reduction of payments by 50 ha would decrease land sales prices by 445 ha before and by 984 ha after the reform jel q15 q18

incorporating fuel constraints and electricity spot prices into the stochastic unit commitment problem the electric power industry is going through deregulation as a result the load on the generating units of a utility is becoming increasingly unpredictable furthermore electric utilities may need to buy power or sell their production to a power pool that serves as a spot market for electricity these trading activities expose utilities to volatile electricity prices in this paper we present a stochastic model for the unit commitment that incorporates power trading into the picture our model also accounts for fuel constraints and prices that may vary with electricity prices and demand the resulting model is a mixed integer program that is solved using lagrangian relaxation and bender s decomposition using this solution approach we solve problems with 729 demand scenarios on a single processor to within 0 1 of the optimal solution in less than 10 minutes our numerical results indicate that significant savings can be achieved when the spot market is entered into the problem and when stochastic policy is adopted instead of a deterministic one

the capitalization of coupled and decoupled cap payments into land rental rates this article explores the extent to which payments under the common agricultural policy cap are capitalized into land rents in ireland with implications for the transfer efficiency of such payments since subsidies may not benefit targeted recipients if they are capitalized into input prices capitalization in the years preceding and following the decoupling of agricultural support payments from agricultural production is explored in the period prior to decoupling direct support pillar 1 payments were highly capitalized into irish agricultural rents 67 90 cents per euro of subsidies while in the post decoupling period capitalization appears to have declined somewhat

an analysis of growth of u s farmland prices 1963 82 increases in expected inflation or real growth in net rental income to land have been proposed as alternative explanations of the dramatic real growth in u s farmland prices in the 1970s in this paper the effect of inflation is shown to be theoretically ambiguous an empirical analysis using u s and international farmland prices suggests that most of the real land price growth can be explained by real growth in net rental income to land increases in expected inflation have had a negative effect on real land prices but the effect of inflation has been comparatively small

prices technology and farm size in this paper we construct and empirically test a theory of the agricultural firm which explains the long term growth in farm size in the united states typically the u s farm unit is a family enterprise consequently the ratio of the opportunity cost of farm labor to the price of machinery services determines the size of the farm operation by influencing the machine labor ratio applying the model to u s data we explain virtually all of the growth in the machine labor ratio and in farm size over the 1930 70 period by changes in relative factor prices without reference to technological change or economies of scale

targeting public investments by agro ecological zone to achieve growth and poverty alleviation goals in rural india abstract this paper shows that improved technology and rural infrastructure have made important contributions to agricultural growth and poverty reduction in india however these effects have varied widely across agro ecological zones in the past the government has devoted more resources to irrigated areas and this has led to significant production growth and poverty reduction in those areas however as investments in irrigated areas continue to increase their marginal returns diminish and it is now in many of the rainfed areas including some of lower agricultural potential where the marginal returns from additional government investments in technology and infrastructure are largest

rural poverty and relative prices in india this paper begins with the observation that there has been a trend decline albeit small in rural poverty during 1956 83 but this is obscured by the substantial short run fluctuations around the trend it argues that while the trend is attributable to redistributive policies the short run fluctuations are adequately explained by the fluctuations in agricultural output and in relative prices of agricultural products vis a vis manufactures in view of the finding that rising relative agricultural prices increase rural poverty the paper goes on to analyze the process of determination of relative prices this analysis highlights the characteristics of the inflationary process and the role of agricultural price policy in the indian economy copyright 1989 by oxford university press

agricultural growth poverty reduction and agro ecological zones in india an ecological fallacy abstract in an article in this journal that is part of an oevre that has been widely cited shenggen fan peter hazel and t haque 2000a present evidence that government investments in india now have greater effects on poverty in rainfed than irrigated regions this note suggests that parts of the methodology on which this claim is based are unclear and possibly suffer from an ecological fallacy even after clarification of their method by the authors some doubts remain as to whether the results quoted support the original claim

land prices land rents and technological change evidence from pakistan abstract the intertemporal behavior of land prices and land rents in two production environments of pakistan is investigated empirical analyses indicate that a agricultural technology adoption has had a strong positive impact on real land rents over the past 30 years in both irrigated and rainfed areas b capitalization of rents into land prices has accounted for approximately 70 of observed increases in land prices during this period c expected capital gains have been an important additional factor driving up land prices and d neither expected inflation nor inflows of remittance income from abroad have had a significant effect on land prices

poverty agricultural production and prices in rural india a reformulation the empirical analysis at the all india level demonstrates that while the level of agricultural production and rural poverty were inversely related unanticipated consumer price increases aggravated rural poverty whether the advent of the new agricultural technology in the late 1960s altered the relationships in question is also considered during the new technology phase the coefficient of agricultural production ceased to be significant while that of unanticipated price changes continued to be significant rationalization of the absence of a significant inverse relationship between rural poverty and agricultural production at the state level in terms of distress migration between neighboring states is questioned and an alternative explanation is provided copyright 1989 by oxford university press

two tier land tenure system and sustained economic growth in post 1978 rural china abstract the two tier land tenure system has been widely blamed for the problems in land allocation and in land specific investment observed in the postreform rural china greater privatization of property rights in land has been proposed to enable productive farmers to acquire more land to promote land circulation to improve farmers access to credit and to encourage farm investment it is argued here that in the presence of multiple market distortions land privatization is unlikely to provide a solution to the agricultural problems rather an approach which refines the existing framework of the two tier ownership system offers more promise

from policy aims and small farm characteristics to farm science needs this paper examines the agricultural science needs of small farms the green revolution successfully negotiated two tightropes agricultural productivity increases were larger than the fall in prices that resulted from producing more food and output per hectare rose faster than output per worker thus increasing the demand for labor the current challenge is to generate technology that helps poor farmers in low potential areas since research capacity is increasingly private incentives to produce the needed technology are needed perhaps through contracts to produce varieties with specific characteristics development of seeds needs complementary work on water for which economists plant scientists and engineers need to pool their skills

what has luck got to do with it a regional analysis of poverty and agricultural growth in rural india this article explores the role of agro ecological factors associated with agricultural growth and poverty outcomes in india using a new operationalisation of agro ecological factors and incorporating within state variations in poverty and other variables we show that agricultural growth and poverty reduction appear to depend on underlying agro ecological conditions which are favourable to the spread of irrigation and hence agricultural development which in turn in associated with poverty reduction promotion of agriculture in less favoured areas in unlikely to have similar effects on agriculture in less favoured areas is unlikely to have similar effects on agricultural growth even if the effects of agricultural growth on poverty remain similar unless conditions for irrigation are favourable or rainfall is sufficiently abundant and reliable this suggests that considerable caution may be needed in drawing policy conclusions from empirical analysis by state alone and without regard to their underlying f

amenity benefits and the optimal allocation of land agricultural land often yields sig nificant amenity benefits that may not be re flected in the prevailing allocation of land be tween agricultural and nonagricultural uses this paper introduces a simple supply demand model that incorporates these benefits in the de termination of optimal land allocation three stage least squares and county level data are used to estimate the supply and demand param eters these estimates confirm the plausibility of the conceptual model results from the con tingent valuation literature illustrate the extent of underallocation of land to agriculture due to existing institutional conditions some correc tive measures and their distributional effects are discussed and quantified jel q24

the impact of farmland price changes on farm size and financial structure a modified vickers model is used to show that farmland capital gains provide incentive to increase farm acreage and debt use farmland capital losses have the opposite effect the model indicates that part of the current financial vulnerability of the u s farm sector can be traced to management decisions made in response to the farmland capital gains of the 1970s the effects are not purely tax driven though taxes can affect the magnitude of incentives the vickers model is modified to allow a finite horizon taxes and the recognition of unrealized capital gain or loss

an error correcting model of farmland prices granger has demonstrated that if two variables are integrated of order one and are conitegrated they can be modelled as having been generated by an error correction mechanism cointegration and error correction systems allow long run components of variables to obey equilibrium constraints while short run components are allowed to have flexible dynamic specification using data from five corn belt states in the us we show that farmland prices and cash rents are each integrated of order one and are model is estimated the error correction term is found to be significant in both equations indicating granger causality running in both directions historical simulation of the model is performed the price equation peroformed better although both equations simulate reasonably well

risk constrained bidding strategy with stochastic unit commitment this paper develops optimal bidding strategies based on hourly unit commitment in a generation company genco that participates in energy and ancillary services markets the price based unit commitment problem with uncertain market prices is modeled as a stochastic mixed integer linear program the market price uncertainty is modeled using the scenario approach monte carlo simulation is applied to generate scenarios scenario reduction techniques are applied to reduce the size of the stochastic price based unit commitment problem and postprocessing is applied based on marginal cost of committed units to refine bidding curves the financial risk associated with market price uncertainty is modeled using expected downside risk which is incorporated explicitly as a constraint in the problem accordingly the proposed method provides a closed loop solution to devising specific strategies for risk based bidding in a genco illustrative examples show the impact of market price uncertainty on genco s hourly commitment schedule and discuss the way gencos could decrease financial risks by managing expected payoffs

formally testing the present value model of farmland prices this paper applies recent statistical developments in the study of stock market price movements to study the plausibility of the constant expected returns version of the present value model as an explanation of farmland prices using iowa farmland price and rent data over the 1921 86 sample period formal test results indicate that although farmland price and rent movements are highly correlated price movements are not consistent with the implications of this model there appear to be persistent predictable excess positive and or negative returns in the iowa farmland market

optimal operation of a chp plant participating in the german electricity balancing and day ahead spot market abstract during the last years operators of combined heat and power chp plants are challenged by changing circumstances in the electricity markets while ensuring a stable heat and power supply for customers chp plant operators seek to maximise the profitability of the chp plant operation we propose a comprehensive concept and illustrate its potential for increasing the profitability when operating a chp plant with heat storage by participating in multiple electricity markets for this purpose the structure of the decision making process consisting of bid submission market clearing and chp plant operation planning is represented a multistage stochastic mixed integer linear programming milp model is developed that simultaneously optimises the operation of the chp plant with heat storage and bidding in sequential electricity markets price uncertainty is captured by means of stochastic processes the proposed concept is applied to the real case of a municipal energy supply company that participates in the german day ahead spot and balancing market results of the case study illustrate how trading in sequential electricity markets can result in an increased profitability of the chp plant operation where additional revenues from trading offset higher generation costs furthermore we exemplify how the optimal operation of the chp plant and heat storage device are adjusted according to revenue potential in multiple electricity markets

boom bust cycles and ricardian rent north american agriculture has been characterized by many as a boom bust industry for example between 1973 and 1983 prairie farmers experienced the most prosperous period of grain farming ever known in western canada had the golden age finally arrived for prairie agriculture prosperity came to a grinding halt in the mid 1980s and in the late 1980s prairie grain farmers entered into one of the worst economic situ

new markets and technological change for the traditional cereals in semiarid sub saharan africa the malian case during the last three decades in sub saharan africa development and research resources have concentrated on the higher rainfall and irrigated regions especially on export crops and the principal food crops grown there there has been much less concern and investment in semiarid regions without irrigation another negative factor has been the lack of public policy concern with the profitability of the basic food crops with good weather prices collapse with bad weather governments and ngos dispense food crops as food aid or at subsidized prices this article documents the importance of the demand side to facilitate diffusion of new technologies for the basic food commodities of semiarid regions the traditional cereals with farm programming models aggregated into a sector model the combination of technological change and demand shifts for sorghum are evaluated in one semiarid region where the traditional cereals are concentrated it focuses on combining policies to increase the prices farmers receive after introduction of technologies that use higher input levels it also compares benefits of a strategy that focuses on yield and demand increases for a traditional cereal of the semiarid region sorghum with two alternative strategies for the higher rainfall zone

risk constrained generation asset arbitrage in power systems a competitive generating company genco can maximize its payoff by optimizing its generation assets this paper considers the genco s arbitrage problem using stochastic price based unit commitment while considering the associated risks the genco may consider arbitrage opportunities in purchases from qualifying facilities qfs as well as simultaneous trades with spot markets for energy ancillary services fuel and emission allowance the tradeoff between maximizing expected payoffs and minimizing risks due to market price uncertainties is modeled explicitly by including the expected downside risk as a constraint the downside risk is defined as the unfulfilled profit the monte carlo simulation is applied to generate scenarios and scenario reduction techniques are applied to reduce the number of scenarios while maintaining a good approximation of the exact solution the proposed case studies illustrate the significance of arbitrage in multi commodity markets and the importance of considering the uncertainty of market prices

farmland accumulation and prices a model of farmland accumulation is developed to study factors influencing u s farmland values this model stresses the manner in which credit is allocated for land purchases to secure necessary loans for additional land to expand farm size the farmer provides as collateral his net accumulated wealth thus land acquisitions are made to increase profits and to provide leverage for further land expansion besides income and consumption the level of accumulated debt is one of the main determinants of farmland prices derived demand for farmland is developed and the pricing equation for farmland is estimated as part of a structural equation model

linking the price of agricultural land to use values and amenities the recent appreciation in agricultural land values across the united states has raised a number of important questions for farmers farmland owners lenders and policy makers while traditional economic theory suggests that farmland values are determined by the discounted stream of expected returns previous research has shown that agricultural land values are actually driven by a complex set of factors this study leverages the unique characteristics of a national land based usda survey on farmland values and cash rents to estimate broad national level determinants of the market value of cropland and pastureland our results support past research findings that indicate farmland values are only partially explained by agricultural returns we find that multiple nonagricultural attributes of farmland also contribute to the market value

on farmland prices and rents in japan historically the japanese farmland market has been strongly regulated although fundamental changes in policy were introduced in 1967 and 1980 this article examines the relationship between farmland prices and rents in japan for 1955 2000 using the cointegration procedure of johansen et al 2000 which admits structural breaks results show the presence of a cointegrating relationship with a significant break in 1980 there is granger causality from prices to rents which suggests that rents are determined within an institutional setting according to farmland prices the rent price elasticity is unity which supports the notion of efficiency in the farmland market

the impact of landownership security theory and evidence from thailand this article develops a model of farmers land acquisition and investment decisions the model clarifies the relation between land values landownership security and credit markets the risk of eviction of untitled lands and the advantages in access to credit associated with titled land are shown to account for the higher price of titled land furthermore observed land prices are distorted when credit is priced below the opportunity cost of capital and the risk of eviction is positive therefore social benefit analysis of land titling cannot utilize land prices without correcting for these distortions the article offers formulas for performing such corrections econometric estimates of the value of legal ownership in three provinces of thailand using cross section land price data show a statistically significant effect of ownership security on land price the econometric estimates of ownership security are combined with the formulas generated by the model to yield estimates of the social benefit of land titling in the three provinces the analysis implies that granting full legal ownership to squatters can be a socially beneficial policy in many provinces

vegetable spirits and energy policy this study investigates the extent to which the 2005 energy policy act specifically the ethanol mandate contributed to the rise in farmland values we use the location of new ethanol plants to identify the capitalization effect of the mandate by these spatially advantaged operations we use a difference in difference propensity score matching estimator to control for the non random selection of ethanol production facilities the empirical strategy uses farmland parcel values from the 2001 7 june agriculture survey we find that new ethanol facilities had no effect on nearby farmland values prior to the mandate but had statistically significant effects after the policy copyright 2013 oxford university press

returns to investment in less favored areas in developing countries a synthesis of evidence and implications for africa abstract a large proportion of world s population lives in marginal or less favored areas these areas are of home to the poorest segment of the population particularly in rural areas in the past government has targeted their resources mostly to the high potential or irrigated areas these investments have generated rapid growth in agricultural production for example the so called green revolution in south and southeast asia in the 1970s and 1980s which in turn has helped to alleviate rural and urban poverty however as investments continue to increase in these favored areas their marginal returns have begun to decline and environmental problems are emerging evidence shows that it is in the marginal areas or less favored areas where many investments may have higher returns today these investments may have even larger impacts on poverty reduction and environmental protection as poor people are increasingly concentrated in the marginal areas where natural resources have already been severely degraded this study synthesizes some recent studies from india and china on the relative returns to investments in favored and less favored areas and presents some preliminary evidence from uganda and offers some policy implications for africa on how governments and international donors can reprioritize their investment portfolio in order to achieve multiple goals of growth poverty reduction and environmental protection

land prices and farm based returns the theoretical and empirical relationship between farm based residual returns the opportunity cost of farmland and farmland prices is developed temporal hypotheses concerning the source of land price movements are tested using a variant of granger causality in the aggregate farmland prices are found to be unidirectionally caused by residual farm based returns the findings support the hypothesis that farmland prices are determined mainly within the farm sector and lend credence to the use of extrapolative expectations processes in structural farmland price models

the evolution of farm programs and their contribution to agricultural land values the economic environment of agricultural producers has been influenced by formal u s agricultural policy for more than seventy years among the first pieces of new deal legislation proposed by incoming president franklin d roosevelt was a farm program designed to address declines in crop prices and net farm income key features of the agriculture act of 1933 included mandatory price support for specified commodities direct subsidy payments to farmers and supply controls farm programs once viewed as temporary and supplementary to agricultural earnings are increasingly viewed as permanent and of major proportion gardner examined the relationships between u s farm commodity programs and u s farm structure while others see sumner for concept evidence and implications have examined farm programs and specific crops gardner 2002 and weersink et al analyzed the effects of farm program programs upon land values these studies examined various aspects of agricultural policy including whether farm program payments have enhanced land prices and landowner wealth rather than the welfare of producers while it would seem logical that revenueenhancing farm programs would increase land values reliably estimating the magnitudes of farm program effects upon land values is an empirically challenging task both statistical and budgeting based methodologies have been used to estimate the share of land prices generated by farm program payments statistically based studies are complicated by the fact that both real per acre crop receipts

arima models to predict next day electricity prices price forecasting is becoming increasingly relevant to producers and consumers in the new competitive electric power markets both for spot markets and long term contracts price forecasts are necessary to develop bidding strategies or negotiation skills in order to maximize benefit this paper provides a method to predict next day electricity prices based on the arima methodology arima techniques are used to analyze time series and in the past have been mainly used for load forecasting due to their accuracy and mathematical soundness a detailed explanation of the aforementioned arima models and results from mainland spain and californian markets are presented

strong formulations for multistage stochastic self scheduling unit commitment with the increasing penetration of renewable energy into the power grid system the volatility of real time electricity prices increases significantly this brings challenges for independent power producers to provide optimal bidding strategies the traditional approaches of only attending the day ahead market might not be profitable enough without taking advantage of real time price volatility in this paper we study the optimal bidding strategies for the independent power producers utilizing self scheduling strategies to participate in the real time market considering real time electricity price volatility with the objective of maximizing the total expected profit considering the correlations of renewable energy generation outputs among different time periods the correlations of real time prices are captured in our modeling framework in which we explore a multistage stochastic scenario tree to formulate the price uncertainties accordingly the derived multistage stochastic self scheduling unit com

economic impact of electricity market price forecasting errors a demand side analysis several techniques have been proposed in the literature to forecast electricity market prices and improve forecast accuracy however no studies have been reported examining the economic impact of price forecast inaccuracies on forecast users therefore in this paper the application of electricity market price forecasts to short term operation scheduling of two typical and inherently different industrial loads is examined and the associated economic impact is analyzed using electricity market price forecasts as the expected next day electricity prices optimal operating schedules and the associated costs are determined for each load these costs are compared with those of a perfect price forecast scenario in which actual prices are used to determine the operating schedules numerical results and discussions are provided based on price forecasts with different error characteristics

income and the environment in rural india is there a poverty trap we study the relationships between rural income distributions and changes in environmental conditions in southern western and central india between 1994 95 and 2000 01 other than the relatively rich we find that all income strata benefit from an improved environment and intermediate expenditure households benefit more than the very poor in absolute terms higher median consumption expenditures and richness are estimated to increase environmental decline but we do not find a significant impact of income poverty on local environmental health the results do not support the poverty trap conjecture with environmental degradation driving expenditure reductions that promote offsetting aforestation which benefits the poor

plant breeding and poverty can transgenic seeds replicate the green revolution as a source of gains for the poor 1 abstract improved farm technology helps all main groups of the poor small farmers farmworkers other low wage labour when it raises labour value productivity but raises land and or water value productivity faster and cuts staples prices but raises smallholders total factor productivity faster from 1965 the green revolution walked these two tightropes largely by luck though targeting bigger piles of rice and wheat it cut poverty through consumption nutrition smallholder income employment risk reduction and ecological sustainability yet large areas were left out and from 1985 progress slowed in the new environment for research and agriculture how can transgenics revive and spread poverty reduction what has been the evidence so far what determines whether new varieties have traits conducive to poverty reduction who owns the research or what crop science is

the effect of agricultural policy on farmland values the extent to which agricultural support programs have been capitalized into farmland prices has been examined in this study a present value land price model was developed which decomposes returns to the land base into its two possible sources farm production and government subsidies and allows the discount rates associated with these two income sources to vary the empirical results indicate that government payments are discounted less than marketbased returns in ontario thus government payments have been viewed as a more stable source of income to ontario farm operators during the last half century than market based returns

strategic bidding for price taker hydroelectricity producers this paper introduces a stochastic programming model that integrates strategic bids or offers for electricity in quantities and prices in a deregulated electricity market the model is designed to maximize the profits of a producer of electricity who manages a series of power plants along a river the model is compared with a previously reported stochastic model where the bidding process is disregarded the superiority of the new model is empirically demonstrated on historical data

farm real estate price components 1920 78 the research reported demonstrates that farm real estate price involves important components in addition to the capitalized value of rent for the services of land and buildings in farm production develops an expectations model for the farm real estate market and compares predictions from the expectations model with farm real estate prices for the 1920 78 period capitalized rent explains only about half of real estate values both in the 1970s and over the longer 1920 78 period the remainder can be explained by the capitalization of capital gains including real gains or losses from price level changes

optimal bidding strategies for hydro electric producers a literature survey in a competitive environment with bid based markets power generation companies desire to develop bidding strategies that maximize their revenue in this paper we ask what approaches and methodologies have been used to model the bidding problem for hydro electric producers we present the problem s developments over time and through reviewing different variants of the problem progressively build to the case in which the agent is a price maker hydro electric producer in each variant of the bidding problem we examine how the approaches used to solve it may or may not be applicable to other variants last for the price maker hydro electric producer s bidding problem we recognize the most recent developments and illuminate a path for future efforts

the economic value of farm program base mixed integer programming and dynamic programming models were used to obtain the implicit economic value of the initial endowment of base acreage on a cotton farm while low levels of initial base have almost no impact on land value high levels can be worth a considerable premium with the implicit value of additional initial base endowment increasing at an increasing rate this pattern of increasing implicit value can be explained by provisions of the farm program allowing base to be created by a landowner who develops a planting history in a program commodity

optimal farm size in an uncertain land market the case of kyrgyz republic this article applies a real options model to the problem of land development making use of the 1998 2001 kyrgyz household budget survey we show that when the hypothesis of decreasing return to scale holds the relation between the threshold value of revenue per hectare and the amount of land cultivated is positive in addition the relation between the threshold and the amount of land owned is positive in the case of continuous supply of land and negative when there is discontinuous supply of land the direct consequence is that in the first case smaller farms will be more willing to rent land and exercise the option where in the second case larger farms will exercise first the results suggest three main conclusions i the combination of uncertainty and irreversibility is an important factor in land development decisions ii farmer behavior is consistent with the continuous profit maximization model and iii farming unit revenue tends to be positively related to farm size once uncertainty is properly accounted for

cash rents and land values in u s agriculture a firm level land valuation model is deduced which depends on the expected growth rate in net cash returns to land inflation expectations and property income and capital gains taxes it is then aggregated to obtain an aggregate two sector land valuation model that model is then estimated for twenty four individual states for the period 1960 81 in addition a pooled cross sectional regression model is estimated combining the twenty four state data the model results demonstrate that significant state differences exist in the land market and that in many states agricultural land values are influenced by nonagricultural demand for land

dynamics of a rural land market experiencing farmland conversion to acreages the case of saunders county nebraska this study analyzes an urban influenced real estate market that is experiencing land use transitions evaluating a three year period of unimproved real estate sales in saunders county nebraska has identified components that contribute to farmland values applying these components illustrates that buyers having special motivations often pay premiums to obtain agricultural land a model based on farmland productivity determines a crossover point where it becomes economically justifiable to convert farmland into acreage tracts illustrating productivity levels where concerns over development hold merit areas experiencing farmland development will obtain valuable information for land use and planning decisions from applying this research

assessing the influence of direct payments on the rental value of agricultural land economic theory suggests that coupled and decoupled direct payments have different impacts on agricultural rental values because of the different production responses associated with these payments this study investigates the impact of both coupled and decoupled eu cap direct payments on rental values in northern ireland using panel data taken from the farm business survey for the period from 1994 to 2002 theoretically agricultural land rents are a function of expected market returns and expected associated direct payments the unobservable nature of expected returns means that actual market returns must be used as a proxy for the former in the empirical specification as a consequence the problem of bias due to expectation error arises using a gmm technique to take account of this problem the results of this study show that the impact of cap direct payments on rental values depends on the type of payment and on the nature of the production characteristics of the associated agricultural commodity

tax policies and the financially constrained farm household this article analyzes the implications of income profit and consumption taxes on the economic decisions of financially constrained farm households within a dynamic intertemporal framework the most important results are that replacing a profits tax with a consumption tax would lead to increases in on farm work farm income and farm production in the short run capital accumulation would be enhanced leading to similar effects in the long run if an income tax is replaced with a consumption tax similar expansive effects would occur in the intermediate and long run but in the short run there would be no effect on farm production

the impacts of different farm programs on cash rents county level annual observations for iowa from 1996 through 2000 were used to measure the impacts of farm program payments on cash rental rates the econometric analysis explicitly incorporates spatial autocorrelation cash rental rates were found to increase by almost one dollar per acre for each additional dollar per acre paid for market loss assistance and production flexibility contracts whereas conservation reserve program payments appear to exert no effect on cash rental rates a counterintuitive finding that warrants further examination is the small but negative impact of deficiency payments on cash rental rates

a dynamic analysis of land prices a dynamic model of land prices is developed it derives arbitrage asset prices under nonadditive dynamic preferences risk aversion and transaction costs the model nests as special cases risk neutrality time additive preferences the static capital asset pricing model capm as well as the dynamic consumption based capm the model is applied to the analysis of u s land prices for the period 1950 96 the econometric results provide evidence showing that u s land price patterns are inconsistent with risk neutrality or with the static capm model no strong evidence was found against time additive preferences the econometric findings indicate that both risk aversion and transaction costs have significant effects on land prices

understanding farmland price changes this paper develops a structural model of land prices which includes the multidimensional effects of inflation on capital erosion savings return erosion and real debt reduction as well as the effect of changes in the opportunity cost of capital the results show that inflation and changes in the real returns on capital are major explanatory factors in farmland price swings in addition to returns to farming additionally the effects of credit market constraints and expectations schemes are considered explicitly in the analytical model

production prices and poverty in rural india this paper challenges the view that increases in agricultural production have reduced poverty in rural india rural poverty is related directly to the consumer price index number for agricultural labourers and inversely to agricultural production the underlying time trend term indicates a residual rising trend in rural poverty after accounting for the influence of these two factors there are plausible though conjectural reasons for believing that to a significant extent the price factor as well as the variables implicit in the time trend term both derive their strength if not their existence from the nature of the growth processes which have generated the observed growth in agricultural production these results contradict ahluwalia s earlier conclusions even though they are themselves based on essentially the same data set

forecasting next day electricity prices by time series models in the framework of competitive electricity markets power producers and consumers need accurate price forecasting tools price forecasts embody crucial information for producers and consumers when planning bidding strategies in order to maximize their benefits and utilities respectively this paper provides two highly accurate yet efficient price forecasting tools based on time series analysis dynamic regression and transfer function models these techniques are explained and checked against each other results and discussions from real world case studies based on the electricity markets of mainland spain and california are presented

capitalization of the single payment scheme into land value generalized propensity score evidence from the eu this paper estimates the capitalization of the single payment scheme sps into land values the theory suggests a nonlinear and discontinuous relationship between the sps and land rents in empirical analysis we employ unique farm level panel data and apply the generalized propensity score matching approach our estimates suggest a 6 to 10 sps capitalization rate on average in the european union the nonfarming landowners gains from the sps are only 4 however there is a large variation in the capitalization rate for different sps levels and between different member states 3 to 94

econometric modeling of the capitalization formula for farmland prices an econometric model is formulated to explain the dynamic behavior in farmland prices a second order rational distributed lag on net crop share rents received by landlords captures the dynamic movements of prices and performs well in conditional post sample forecasts the adjustment path of land prices in response to a perturbation in rents is a protracted dampened cycle the implicitly estimated tax free capitalization rate on rent associated with equilibrium land price is 4 0 neither the expected rate of inflation nor an exponential trend on rent expectations has a significant effect on land prices