market structure and market outcomes in deregulated rail freight markets abstract using cross section data on a national sample of city pair markets for rail freight i examine correlations between prices quantities and the number of single line and interline firms serving markets i estimate the reduced form of a structural model in which rail rates and quantities depend on the number of firms i find that rates increase as the number of firms serving the market falls and quantities shipped rise as the number of firms falls the result is consistent with market power for rail freight shippers that causes markups to rise when fewer firms serve the market and is not consistent with other explanations of the relationship between number of firms and rates and quantities interline shipment is much more costly than single line suggesting that mergers may be desirable even if they exacerbate market power problems

on monoculture and the structure of crop rotations an issue when seeking to identify rotation choice is persistence in yield enhancement and input saving carry over effects focusing on carry over length and the monoculture decision we use quasi convexity of choice functions to develop price independent and price dependent principles concerning rotation structure iowa corn soybean rotation data suggest corn has one year memory for corn soybeans in the prior year is yield increasing 16 5 bu ac and nitrogen saving 51 lb ac the hypothesis that soybean has two year memory cannot be rejected corn in the prior year two years increases yield by 7 bu ac 11 6 bu ac we simulate to find price and practice subsidy levels that support different rotations

strike three discrimination incentives and evaluation major league baseball umpires express their racial ethnic preferences when they evaluate pitchers strikes are called less often if the umpire and pitcher do not match race ethnicity but mainly where there is little scrutiny of umpires pitchers understand the incentives and throw pitches that allow umpires less subjective judgment e g fastballs over home plate when they anticipate bias these direct and indirect effects bias performance measures of minorities downward the results suggest how discrimination alters discriminated groups behavior generally they imply that biases in measured productivity must be accounted for in generating measures of wage discrimination

acreage decisions under risk the case of corn and soybeans an acreage supply response model is developed under expected utility maximization the resulting framework is used to specify and estimate a system of risk responsive acreage equations for corn and soybeans in the united states particular attention is given to the truncation effects of government price supports on the distribution of corn and soybean prices also a wealth variable is included in the acreage equations the empirical results indicate that risk and wealth variables play an important role in cornsoybean acreage decisions the analysis also shows that cross commodity risk reduction is important in acreage allocation decisions

replacement of agricultural price supports by area payments in the european union and the effects on pesticide use this article determines the contribution of recent european union agricultural policy reforms on the use of pesticides our theoretical model extends the multioutput generalization of the lichtenberg zilberman damage control technology model developed by chambers and lichtenberg our empirical analysis uses farm level data for a sample of french farms results suggest that price effects on the use of pesticides are always more elastic than area payment effects this indicates that policy reforms consisting of a reduction in price supports in favor of area payments may reduce application of crop protection inputs such policy changes which represent a certain degree of decoupling took place under the 1992 common agricultural policy reforms

is there a glass ceiling over europe exploring the gender pay gap across the wages distribution using harmonised data from the european union household panel we analyse gender pay gaps by sector across the wages distribution for ten countries we find that the mean gender pay gap in the raw data typically hides large variations in the gap across the wages distribution we use quantile regression qr techniques to control for the effects of individual and job characteristics at different points of the distribution and calculate the part of the gap attributable to differing returns between men and women we find that first gender pay gaps are typically bigger at the top of the wage distribution a finding that is consistent with the existence of glass ceilings for some countries gender pay gaps are also bigger at the bottom of the wage distribution a finding that is consistent with sticky floors third the gender pay gap is typically higher at the top than the bottom end of the wage distribution suggesting that glass ceilings are more prevalent than sticky floors and that these prevail in the majority of our countries fourth the gender pay gap differs significantly across the public and the private sector wages distribution for each of our eu countries

an economic model of soil conservation by introducing soil depth and soil loss into a simple model of agricultural production this paper seeks to determine when the private path of erosion differs from the socially optimal path considering the depletion of soil only and abstracting from the environmental disruption caused by erosion the paper argues that under most institutional arrangements the social and private rates of erosion are the same the paper concludes that public policy should be directed toward reducing erosion only when it leads to significant pollution externalities

rationality of weather predictions and insurance purchases testing the gambler s and hot hand fallacies deviations from the rational behaviour assumed in many economic models have been found in a variety of settings two such deviations the gambler s and hot hand fallacies have been found in lab set

the conservation reserve program as a least cost land retirement mechanism mechanism design theory is used to characterize the properties of a least cost crp if marginal land rents decrease with acres farmed then a least cost crp is a set of nonlinear price schedules if marginal land rents are independent of acres farmed then an offer system constitutes a least cost crp the least cost offer system gives a useful estimate of the upper bound of a least cost crp empirical results suggest that a 34 million acre crp should have cost no more than 1 billion per year

determinants of motives for land use decisions at the margins of the corn belt abstract the extent of united states great plains grass agriculture has ebbed and flowed over decades in response to market incentives government policies technological innovations and weather patterns our thesis is that the land most responsive to these drivers is at the economic margin between grass based production and cropping much of the eastern dakotas is such an area primarily under crop based agriculture although grass remains an important land use we surveyed land operators in the area on their views about motivators for land use choices their views are largely consistent with the economic margin viewpoint the importance of crop output prices crop input prices innovations in cropping equipment and weather patterns on land use decisions grow as one moves north toward the economic margin land in more highly sloped areas is more sensitive to crop prices and crop insurance policies consistent with human capital theory older operators are generally less responsive to factors that affect land use those renting more land being more exposed to market forces are more responsive as farm size increases respondents declared higher land use sensitivity to policy issues and technological innovations suggesting that scale effects render land units more sensitive to land use change drivers

the impact of deregulation on the production structure of the motor carrier industry empirical analysis of the motor carrier industry pre and post regulatory reform reveals that deregulation resulted in significant changes in firm production structure and lower real average costs translog cost functions for firms operating in 1977 and 1983 were estimated and compared for other specialized commodity carriers fitted average costs were computed from these functions the results indicate significant differences in the cost functions and real costs that cannot be attributed to technological changes but rather suggest efficiency gains the results also suggest that it is inappropriate to predict outcomes of deregulation using empirical analyses of firms in the regulated environment

the impact of weather on crop yield distribution in taiwan some new evidence from panel data models and implications for crop insurance this study examines the impact of weather on the yields of seven major crops in taiwan based on pooled panel data for 15 prefectures over the 1977 1996 period the unit root tests and maximum likelihood methods involving a panel data model are explored to obtain reliable estimates the uncertain yield outcome is incorporated into a discrete stochastic programming model to address a comparison between sector analysis with and without considerations of a crop insurance policy under different climate change scenarios simulation results suggest that crop insurance may stabilize revenues and protect farmers from exposures to increasing weather related risk

robustness and linear contracts abstract we consider a moral hazard problem where the principal is uncertain as to what the agent can and cannot do she knows some actions available to the agent but other unknown actions may also exist the principal demands robustness evaluating possible contracts by their worst case performance over unknown actions the agent might potentially take the model assumes risk neutrality and limited liability and no other functional form assumptions very generally the optimal contract is linear the model thus offers a new explanation for linear contracts in practice it also introduces a flexible modeling approach for moral hazard under nonquantifiable uncertainty jel d81 d82 d86

environmental and distributional impacts of conservation targeting strategies abstract resource purchasing funds have become a major tool for environmental protection and resource conservation these funds use various strategies to target resources for conservation the choice of which may lead to striking differences in environmental performance this paper develops an analytical framework to analyze the impact of alternative targeting strategies on different interest groups including consumers producers labor and environmentalists we show that ignoring the output price effect of purchasing funds reduces environmental gain and in some cases may make a purchasing fund counterproductive and we argue that the optimal design of targeting criteria must consider the price feedback effect

assessing cost effectiveness of the conservation reserve program crp and interactions between the crp and crop insurance we examine the u s conservation reserve program crp enrollment design while accounting for the crp s interactions with the federal crop insurance program we find that the current crp is not cost effective despite its intent to balance benefits and costs based on crp contract level data we show that adopting a cost effective enrollment design and incorporating crop insurance subsidies into the crp s environmental benefits index would significantly increase the crp acreage environmental benefits and savings on crop insurance subsidies while leaving government outlay unchanged large geographical redistributions of crp acreage would also occur we further investigate the cost effective design s robustness to crp benefit misspecifications

pricing in a deregulated environment the motor carrier experience this paper provides a dynamic analysis of the effects of the motor carrier act of 1980 on the freight rates of class i and ii common general freight carriers in addition to estimating rate equations cost functions are also estimated to derive reliable measures of marginal cost the specified rate equation also includes variables expected to affect the elasticity of demand simulations indicate that deregulation reduced rates in the 15 20 range by 1983 and in the 25 35 range by 1985 showing that the effect has grown over time

prejudice and wages an empirical assessment of becker s the economics of discrimination we test the predictions from becker s 1957 seminal work on employer prejudice and find that relative black wages a vary negatively with the prejudice of the marginal white in a state b vary negatively with the prejudice in the lower tail of the prejudice distribution but are unaffected by the prejudice of the most prejudiced persons in a state and c vary negatively with the fraction of a state that is black our estimates suggest that one quarter of the racial wage gap is due to prejudice with nontrivial consequences for black lifetime earnings

political economy of the 2014 farm bill this article assesses the political economy of the 2014 u s farm bill with a focus on the farm support safety net the farm bill secured substantial bipartisan majorities in a politically contentious congress planned outlays are predominately for nutrition assistance programs directed toward a traditional nonfarm constituency in the farm bill coalition while annual fixed direct payments to farmers are eliminated but replaced with enhanced downside risk protection against low prices or revenue the new support programs may prove more or less costly than the foregone fixed payments with farmers offered a choice between a price countercyclical program with increased reference prices and a revised moving average revenue guarantee program the role of insurance is enhanced notably by replacing past support programs with a new upland cotton revenue insurance program and dairy milk to feed margin protection program open policy issues that are highlighted include the costs and distortionary effects of moving average revenue benchmarks versus fixed reference prices the overall level of insurance premium subsidies the potential for overlap between commodity and insurance programs and lastly food environmental and biofuels concerns that reflect the diverse portfolio of products demanded from agriculture in an international context we conclude that the 2014 farm safety net likely would not have been enacted had multilateral agreement been reached on the 2008 doha round world trade organization negotiating documents conversely the 2014 farm bill makes achieving those limits more difficult research is discussed that can elucidate the ongoing political economy of u s farm policy and help shape future program design

impacts of federal crop insurance on land use and environmental quality this article integrates economic and biophysical models to assess how federal crop revenue insurance programs affect land use cropping systems and environmental quality in the u s corn belt region the empirical framework includes econometric models that predict land conversion and crop choices at the parcel level based on expectation and variance of crop revenues land quality climate conditions and physical characteristics at each site the predictions are then combined with site specific environmental production functions to determine the effect of revenue insurance on nitrate runoff and leaching soil water and wind erosion and carbon sequestration results suggest that federal crop insurance has on average a small effect on conversions of non cropland to cropland and somewhat more significant impacts on crop choice and crop rotation these changes in cropping systems have on average small impacts on agricultural pollution

crop insurance acreage decisions and nonpoint source pollution the redirection of farm policy in the 1996 farm bill has generated much interest in seeking environmentally friendly and economically viable ways to protect farm income agricultural insurance has been suggested as such an instrument this article estimates the effect of crop insurance on crop mix and the resulting change in chemical use in the central nebraska basin providing corn insurance will shift land from hay and pasture to corn which will increase chemical use at the extensive margin this extensive margin effect dominates the effect of crop insurance on the application rate leading to an increase in total chemical use

do gender stereotypes reduce girls or boys human capital outcomes evidence from a natural experiment schools and teachers are often said to be a source of stereotypes that harm girls this paper tests for the existence of gender stereotyping and discrimination by public high school teachers in israel it uses a natural experiment based on blind and non blind scores that students receive on matriculation exams in their senior year using data on test results in several subjects in the humanities and sciences i found contrary to expectations that male students face discrimination in each subject these biases widen the female male achievement difference because girls outperform boys in all subjects except english and at all levels of the curriculum the bias is evident in all segments of the ability and performance distribution and is robust to various individual controls several explanations based on differential behavior between boys and girls are not supported empirically however the size of the difference is very sensitive to teachers characteristics suggesting that the bias against male students is the result of teachers and not students behavior

regulatory reform and technical change new evidence of scale economics in trucking economists have long argued against the regulation of motor carriers in the united states because the industry has been considered to be competitive in nature federal control of trucking has produced inefficiently high rates as well as costs advocates of regulatory reform have foreseen benefits accruing to shippers and consumers in general as greater rate freedom the entry of new firms and the removal of regulatory constraints lead motor carriers to reduce costs 16 and lower prices 17 many of these projected benefits were premised on the perceived competitive market structure of the trucking industry these perceptions have been largely supported by pre deregulation cost studies of general freight carriers which have found evidence of either constant returns to scale or diseconomies of scale friedlaender and wang chiang 8 find that for 20 interregional carriers over 1965 73 the typical firm operating at the sample mean is subject to mild scale diseconomies in a subsequent study of multiproduct economies of scale using 1976 proprietary data they 14 obtain the same basic results the typical firm has constant returns to scale while the representative large firm operates under moderate diminishing returns daughety nelson and vigdor 4 also find mild decreasing returns to scale for a panel of firms spanning 1953 58 in another study over 1974 79 friedlaender and bruce 6 find slight economies of scale for the typical firm based on simulations with the largest and smallest firms in their sample they suggest that over time large carriers have become more characterized by scale economies and small carriers by scale diseconomies however their evidence is far from clear cut given this conventional wisdom that the technology of the less than truckload segment of this industry was constant returns to scale before deregulation few if any economists doubted the desirability of the motor carrier act of 1980 the purpose of this paper is to determine empirically whether the sweeping legislative changes were justified on solely economic grounds it is possible that previous cost studies are biased as a consequence of the regulatory constraints facing the firms has deregulation itself corrected for distortions created by the regulatory environment and thus produced changes in the production choices of trucking companies was friedlaender and spady s 7 contention that truckload carriers may have experienced regulatory rather than technology based increasing returns to scale correct if so perhaps past results for general freight carriers are similarly due to regulation however in this case the reason may be regulatory

an empirical analysis of acreage effects of participation in the federal crop insurance program the extent to which crop insurance programs have resulted in additional land being brought into production has been a topic of considerable debate we consider multiequation structural models of acreage response insurance participation crp enrollment and input usage our analysis focuses on corn and soybean production in the corn belt and wheat and barley production in the upper great plains our results confirm that increased participation in insurance programs provokes statistically significant acreage responses in some cases though the response is very modest in every case in the most extreme cases 30 decreases in premiums as a result of increased subsidies provoke acreage increases ranging from 0 2 to 1 1 a number of policy simulations involving increases in premium subsidies are considered

can gender parity break the glass ceiling evidence from a repeated randomized experiment this paper studies whether the gender composition of recruiting committees matters we make use of the unique evidence provided by spanish public examinations where the allocation of candidates to evaluating committees is random we analyse how the chances of success of 150 000 female and male candidates for positions in the four main corps of the spanish judiciary from 1987 to 2007 were affected by the gender composition of their evaluation committee we find that a female male candidate is significantly less likely to be hired whenever she he is randomly assigned to a committee where the share of female male evaluators is relatively greater evidence from multiple choice tests suggests that this is due to the fact that female majority committees overestimate the quality of male candidates

effects of crop insurance premium subsidies on crop acreage crop insurance premium subsidies affect patterns of crop acreage for two reasons first holding insurance coverage constant premium subsidies directly increase expected profit which encourages more acreage of insured crops direct profit effect second premium subsidies encourage farms to increase crop insurance coverage with more insurance coverage farms obtain more subsidies and farm revenue becomes less variable as indemnities offset revenue shortfalls so acreage of insured crops likely increases indirect coverage effect by exploiting exogenous policy changes and using approximately 180 000 county crop year observations we estimate the sum of these two effects of premium subsidies on the pattern of u s acreage across seven major field crops we estimate that a 10 increase in the premium subsidy causes a 0 43 increase in the acreage of a crop in a county holding the premium subsidy of its competing crop constant taking into account the small share of premium subsidies in expected crop revenue this subsidy impact is analogous to an own subsidy acreage elasticity of 1 24 which exceeds own price acreage elasticity estimates in the literature one explanation for the larger acreage response to premium subsidies is that insurance causes an indirect coverage effect in addition to a direct profit effect

discrimination nepotism and long run wage differentials the wage discrimination model developed by becker has been criticized for predicting that competitive forces will lead to the disappearance of racial discrimination in the long run we have reformulated the model in terms of nepotism toward white workers rather than discrimination against black workers in this new framework both nepotistic and taste neutral firms are expected to survive the competitive struggle in the long run therefore the new framework is consistent with long run as well as short run racial wage differentials

deregulation and scale economies in the u s trucking industry an econometric extension of the survivor principle over the past three decades there has been much progress in the analysis of costs production and scale economies in u s industries including transportation and yet it can also be argued that accounting data on which all such cost and production function estimation is based do not give us a full story regarding scale economies in an industry among those who made this argument most forcefully was george stigler in a seminal article published in 1958 to provide evidence on scale economies with less use of accounting data stigler developed what he called the survivor technique a model that others have used in subsequent studies 1 the present article extends the survivor technique so as to make it a part of an econometric probit model somewhat akin to cost and production functions as they are estimated statistically but preserving the essential features of the survivor model developed by stigler in the 1950s the most important advantage of this approach is that it allows for the incorporation of a number of different variables to explain survivor

discrimination in a deprived neighbourhood an artefactual field experiment abstract we present a field experiment designed to examine the discriminatory motives of an understudied demographic the poorest people in england subjects are first asked to divide 10 between two strangers and then play a 10 dictator game with another stranger we subtly vary the ethnicity of the receivers by providing subjects with surnames randomly drawn from the electoral register including treatments that allow us to parse behaviour into either in group favouritism or out group negativity an important behavioural distinction that is typically overlooked in the discrimination literature our results suggest that the observed discriminatory attitudes are the result of out group negativity rather than in group favouritism we advance the literature on discrimination through the estimation of a structural model of group contingent social preferences which we exploit to perform counterfactual simulations our results provide insights into the behaviour of this unique demographic and provide a rationale for why they may support discriminatory policies in their voting behaviour

employers discriminatory behavior and the estimation of wage discrimination this paper considers the linkage of empirical estimates of wage discrimination between two groups introduced by oaxaca 1973 to a theoretical model of employers discriminatory behavior it is shown that conditional on different assumptions about employers discriminatory tastes oaxaca s estimators of wage discrimination can be derived that the approach is more generally useful is demonstrated by deriving an alternative estimator of wage discrimination based on the assumption that within each type of labor e g unskilled skilled the utility function capturing employers discriminatory tastes is homogeneous of degree zero with respect to labor inputs from each of the two groups the estimators are compared empirically in an application to male female wage differentials

dynamic persistence of primary commodity prices this article examines the persistence of shocks to international commodity prices from 1900 to 2008 using the updated grilli yang index the main innovation of this study is that it determines whether commodity prices are characterized by multiple changes in persistence specifically bootstrap methods are used to estimate persistence and the associated half life shocks are calculated we find that the persistence of shocks can vary widely depending on the individual commodity and the time period the results suggest that policy makers need to exercise caution when introducing measures to cushion the effect of shocks to world commodity prices

do farmers value the environment evidence from a conservation reserve program auction the paper uses data from one conservation reserve program crp auction to elicit farmers attitudes toward the environment by analyzing their bids the crp pays farmers to remove chosen plots of land from agricultural production and put them to a conservation use an interesting aspect of this auction is that winners are determined by a combination of low bids and environmental scores of individual plots using decision theoretic approach to model this auction we show that farmers condition their bids on the strength of their environmental scores and that they value environmental benefits especially those that increase future soil productivity of their land

orchestrating impartiality the impact of blind auditions on female musicians a change in the audition procedures of symphony orchestras adoption of blind auditions with a screen to conceal the candidate s identity from the jury provides a test for sex biased hiring using data from actual auditions in an individual fixed effects framework we find that the screen increases the probability a woman will be advanced and hired although some of our estimates have large standard errors and there is one persistent effect in the opposite direction the weight of the evidence suggests that the blind audition procedure fostered impartiality in hiring and increased the proportion women in symphony orchestras

too burdensome to bid transaction costs and pay for performance conservation in a world free of transaction costs reverse auctions can cost effectively allocate payment for environmental service contracts by targeting projects that provide the most benefit per dollar spent however auctions only succeed if enough farmers choose to bid so that the auctioneer can evaluate numerous projects for targeted funding a 2014 conservation auction to allocate payments for phosphorus reduction practices in nw ohio experienced very thin bidding according to a follow up survey auction participation was deterred by the complexity of the bidding process and the need to negotiate with renters due to low participation the actual conservation auction made payments for phosphorus reduction that were surprisingly costly at the margin applying a farmer behavioral model to the western lake erie basin we simulate participation choice and cost effectiveness of environmental outcomes in reverse auctions and uniform payment conservation programs results reveal that when perceived transaction costs of bid preparation are high reverse auctions are less cost effective than spatially targeted uniform payment programs that attract higher participation keywords reverse auctions transaction costs cost effective conservation programs endogenous participation

on the economics of the optimal fallow cultivation cycle abstract this paper considers the so called fallow cultivation problem in traditional agriculture the paper specifies the problem and determines the optimal duration of the fallow cultivation cycle we study and deduce results on the impact of the switching costs and the output price on this cycle finally we discuss the relation between soil fertility and the output price the fallow cultivation problem is an important economic problem since traditional farming provides the food in most low income countries however it is also worth studying since it is an interesting specimen case in a class of dynamic models in which sensible controls split process variables in distinctive phases

what is discrimination gender in the american economic association 1935 2004 we illustrate problems of measuring discrimination using elections to aea offices with a new econometric technique we find female candidates have a much better than random chance of victory this advantage is either reverse discrimination or reflects beliefs that women are more productive the former interpretation could be explained by an unchanging median voter whose preferences were not satisfied by suppliers of candidates but there was a structural change in voting behavior in the mid 1970s the results suggest it is generally impossible to claim differences in rewards for different groups measure the extent of discrimination or even its direction jel a11 d72 j16

the effect of conservation priority areas on bidding behavior in the conservation reserve program we explore how a landowner s bid to enroll in the conservation reserve program crp is influenced by his parcel s designation as a conservation priority area cpa a theoretical model of a landowner s optimal bid is presented and we demonstrate the ambiguity in a landowner s optimal bid response to cpa designations the bid choice is analyzed using a data set of accepted and unaccepted offers during three crp sign up periods we focus empirically on a subset of offers from the prairie pothole cpa to identify whether bid responses to exogenous location factors differ across landowners with varying opportunity costs to enrollment jel q15 q18

racial discrimination among nba referees the nba provides an intriguing place to assess discrimination referees and players are involved in repeated interactions in a high pressure setting with referees making split second decisions that might allow implicit racial biases to become evident we find that more personal fouls are awarded against players when they are officiated by an opposite race officiating crew than when they are officiated by an own race refereeing crew these biases are sufficiently large so that they affect the outcome of an appreciable number of games our results do not distinguish whether the bias stems from the actions of white or black referees

returns to scale and market concentration among the largest survivors of deregulation in the us trucking industry application of the survivor technique to the 100 largest less than truckload carriers of general commodity freight in the us interstate trucking industry produces estimates of the ranges of increasing constant and decreasing returns to scale from 1981 to 1993 the first thirteen years of deregulation nearly one quarter of total group ton miles hauled is found to have moved into the more efficient size range of constant returns to scale a gain in long run technical efficiency is thereby attributed to the motor carrier act of 1980 moreover the survivorship data allow estimates of intragroup market concentration for each of the same thirteen post deregulation years concentration purely within this group appears to have remained fairly moderate and stable since 1981 an unsurprising finding given the modest minimum efficient size estimated at about 2 million ton miles hauled annually the moderate and stable concentration among the 100 largest is not necessarily incompatible with other research which

female led firms and gender wage policies using a longitudinal data set covering the period 1987 2000 the authors explore the impact of female employers and gender segregation on wages in portugal in the context of becker s 1957 taste for discrimination theory they investigate whether the gender of a firm manager affects gender wage differences they find that females benefit from higher wages in female led firms than in male led firms further when females lead the wage gap between female and male workers is reduced by 1 5 regardless of the gender composition of the workforce at the same time the higher the share of females in a firm the lower the wages overall for both female and male workers the authors results are compatible with the notion that job promotion is an important factor in wage increases the more females are mentored and promoted the less men will be however as more females in the firm compete for promotion opportunities for both females and males to be promoted diminish author s abstract

ranking crop yield models using out of sample likelihood functions there has been considerable debate regarding which probability distribution best represents crop yields this study ranks six yield densities based on their out of sample forecasting performance the forecasting ability for each density was ranked according to its likelihood function value when observed at out of sample observations results show that a semiparametric model offered by goodwin and ker best forecasts county average yields

sodbusting crop insurance and sunk conversion costs we build a real option model that articulates sodbusting incentives arising from risk interventions in the presence of conversion costs the model shows that risk interventions reduce expected costs of switching land use between cropping and noncropping activities and hence incentivize sodbusting based on data for south central north dakota over 1989 2012 our simulations show that offsetting 20 of a cropping return shortfall by a risk intervention increases the sodbusting cost threshold below which sodbusting will occur by 41 or 43 7 acre omitting cropping return risk across time underestimates the sodbusting cost threshold by 23 or 24 35 acre and hence underestimates sodbusting caused by crop production

endophilia or exophobia beyond discrimination the discrimination literature treats outcomes as relative but does a differential arise because agents discriminate against others exophobia or because they favour their own kind endophilia using a field experiment that assigned graders randomly to students examinations that did did not contain names we find favouritism but no discrimination by nationality nor by gender we are able to identify these preferences under a wide range of behavioural scenarios regarding the graders that endophilia dominates exophobia alters how we should measure discriminatory wage differentials and should inform the formulation of anti discrimination policy

the inefficiency of regulating a competitive industry productivity gains in trucking following reform this study confirms the higher productivity levels predicted by advocates of regulatory reform in trucking and shows that these gains have been substantial cost simulations suggest that following a year of higher expenditures efforts to remain competitive have yielded considerable cost savings that increase over time from 1 percent in 1981 to 23 percent in 1984 the indirect effects of reform through the independent variables initially decrease costs but later lead to higher costs the cumulative effect has been a less than 1 percent increase in costs in 1980 becoming by 1984 a significant 16 percent productivity gain copyright 1990 by mit press

the economics of a public fund for environmental amenities a study of crp contracts the problem of targeting crp purchases to buy environmental amenities under productivity and environmental heterogeneity is considered gini coefficients and lorenz curves are used to measure the effectiveness of spending under alternative targeting criteria the environmental benefits considered are water erosion wind erosion surface water quality and wildlife habitat the three alternative targeting criteria examined include purchasing land according to i the benefit to cost ratio ii the level of benefits and iii the level of cost results indicate that the degree of variability and correlation determine the extent to which suboptimal targeting achieves a significant portion of available environmental benefits

systemic risk reinsurance and the failure of crop insurance markets without affordable reinsurance private crop insurance markets are doomed to fail because systemic weather effects induce high correlation among farm level yields defeating insurer efforts to pool risks across farms using an empirical model of the u s crop insurance market we find that u s crop insurer portfolios are twenty to fifty times riskier than they would be otherwise if yields were stochastically independent across farms we also find that area yield reinsurance contracts would enable crop insurers to cover most of their systemic crop loss risk reducing their risk exposure to levels typically experienced by more conventional property liability insurers copyright 1997 oxford university press

modeling biomass procurement tradeoffs within a cellulosic biofuel cost model abstract we develop a long run cellulosic biofuel cost model that minimizes feedstock procurement and processing costs per gallon the distinguishing feature of the model is that it accounts for the procurement tradeoff between the intensive margin biomass producers participation rate and extensive margin biomass capture region to investigate the extent to which this procurement tradeoff affects processors cost minimizing decisions we apply the model to switchgrass ethanol production in u s crop reporting districts results suggest that location characteristics will determine the extent to which processors can reduce their total procurement costs by offering a higher biomass price to increase participation near the plant and reduce transportation costs