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

survey evidence on the willingness of u s consumers to pay for automotive fuel economy abstract prospect theory holds that human beings faced with a risky bet will tend to value potential losses about twice as much as potential gains previous research has demonstrated that prospect theory could be sufficient to explain an energy paradox in the market for automotive fuel economy this paper analyzes data from questions added to four commercial multi client surveys of 1000 u s households each in 2004 2011 2012 and 2013 households were asked about willingness to pay for future fuel savings as well as the annual fuel savings necessary to justify a given upfront payment payback periods inferred from household responses are generally consistent over time and across different formulations of questions mean calculated payback periods are about 3 years but there is substantial dispersion among individual responses the calculated payback periods do not appear to be correlated with the attributes of respondents respondents were able to quantitatively describe their uncertainty about both vehicle fuel economy and future fuel prices simulation of loss averse behavior based on respondents stated uncertainty illustrates how loss aversion could lead consumers to substantially undervalue future fuel savings relative to their expected value

the impact of ethanol plants on surrounding farmland values a case study the expansion of the corn ethanol industry after 2003 increased corn prices throughout the united states and in some cases prices were shown to be higher with proximity to individual ethanol plants this leads to the hypothesis that the value of farmland in close proximity to ethanol plants is higher than comparable farmland located farther away this hypothesis was explored by examining the sale of 961 farmland parcels during 2004 2008 in the vicinity of two corn ethanol plants in northeastern nebraska hedonic models including land characteristics as well as spatial and plant proximity measures failed to show support for the hypothesis

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

urban sprawl and farmland prices a theoretical model of farmland valuation is developed to explicitly account for three effects of urban sprawl conversion of farmland to urban uses effect on agricultural returns and speculative effect as represented by farmland conversion risk this model is estimated using county level data in the continental united states evidence is found for all three effects of urban sprawl on farmland values counties more accessible to major urban centers have higher net agricultural returns subsidiary evidence supports that the latter effect may be attributed to survival of or conversion to high valued agriculture around urban centers

interest rates and currency prices in a two country world abstract this paper is a theoretical study of the determination of prices interest rates and currency exchange rates set in an infinitely lived two country world which is subject both to stochastic endowment shocks and to monetary instability formulas are obtained for pricing all equity claims nominally denominated bonds and currencies and these formulas are related to earlier closely related results in the theories of money finance international trade

monopolistic competition credibility and the output costs of disinflation programs an analysis of price controls abstract brazil argentina and israel all used price controls as part of disinflation programs in 1985 1986 in each case they were intended to break an inertial component of inflation this paper focuses on the interaction between lack of credibility of government monetary policy announcements and the price setting behavior of forward looking firms we show that this interaction can lead to inertia extending well beyond the price setting period lack of credibility is then shown to lead to output losses during a disinflation program the paper analyses asset price behavior during disinflation programs with and without price controls and the influence of credibility problems finally we show that if past government policy has any information content about future government policy cheating on current announcements of tight policy buys current employment gains during the price control period at the cost of higher inflation afterwards sustaining low inflation after the price control period thus requires restrictive monetary policy during the price control period

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

consumer myopia imperfect competition and the energy efficiency gap evidence from the uk refrigerator market abstract the empirical literature on the energy efficiency gap concentrates on demand inefficiencies in the energy using durables markets and finds evidence that consumers underestimate future energy costs when purchasing a new appliance we take a broader view and also consider the impact of imperfect competition using data on the uk refrigerator market 2002 2007 we find that the average energy consumption of appliances sold during this period was only 7 2 higher than what would have been observed under a scenario with a perfectly competitive market and non myopic consumers one reason for this small gap is that market power actually reduces energy use

currency prices terms of trade and interest rates a general equilibrium asset pricing cash in advance approach currency prices terms of trade and interest rates a general equilibrium asset pricing cash in advance approach

is there an energy paradox in fuel economy a note on the role of consumer heterogeneity and sorting bias abstract from the previous literature it can be found that consumers tend to undervalue discounted future energy costs in their purchase decisions for energy using durables we show that this finding could in part result from ignoring consumer heterogeneity in empirical analyses as opposed to true undervaluation

do consumers recognize the value of fuel economy evidence from used car prices and gasoline price fluctuations abstract debate about the appropriate design of energy policy hinges critically on whether consumers might undervalue energy efficiency due to myopia or some other manifestation of limited rationality we contribute to this debate by measuring consumers willingness to pay for fuel economy using a novel identification strategy and high quality microdata from wholesale used car auctions we leverage differences in future fuel costs across otherwise identical vehicles that have different current mileage and therefore different remaining lifetimes by seeing how price differences across high and low mileage vehicles of different fuel economies change in response to shocks to the price of gasoline we estimate the relationship between vehicle prices and future fuel costs our data suggest that used automobile prices move one for one with changes in present discounted future fuel costs which implies that consumers fully value fuel economy

information inefficiency and willingness to pay for energy efficient technology a stated preference approach for china energy label abstract the paper examines the extent to which consumers willingness to pay for energy efficient room air conditioners may be altered by correcting the information inefficiency on the china energy label the data are collected from a discrete choice experiment with two alternatives variable speed and constant speed room air conditioners characterized by attributes of brand purchase price and energy grade three versions of the questionnaires with choice sets differing only in energy consumption indicators were distributed randomly to 1602 potential consumers in nanjing china and a sample of 1569 was obtained after dropping missing data the analysis with multinomial and mixed logit models reveal that the price premium that consumers are willing to pay for a variable speed room ac over a constant speed room ac increases significantly when energy consumption information becomes comparable and additional energy related information is provided furthermore the impact of information on wtp varies under different energy saving scenarios it is suggested that china energy label should correct information inefficiency by adopting same energy indicators for room acs with different technologies and providing energy consumption information based on different climate zones

factors influencing illinois farmland values a hedonic model of illinois farmland values is estimated using county level cross section time series data explanatory variables include land productivity parcel size improvements distances to chicago and other large cities an urban rural index livestock production through swine operation scale and farm density measures population density income and inflation the inclusion of spatial and serial correlation components substantially improves the model fit farmland values decline with parcel size ruralness distance to chicago and large cities and swine farm density and increase with soil productivity population density and personal income

what do consumers believe about future gasoline prices a full understanding of how gasoline prices affect consumer behavior frequently requires information on how consumers forecast future gasoline prices we provide the first evidence on the nature of these forecasts by analyzing two decades of data on gasoline price expectations from the michigan survey of consumers we find that average consumer beliefs are typically indistinguishable from a no change forecast justifying an assumption commonly made in the literature on consumer valuation of energy efficiency we also provide evidence on circumstances in which consumer forecasts are likely to deviate from no change and on significant cross consumer forecast heterogeneity

sticky goods prices flexible asset prices monopolistic competition and monetary policy a monetary general equilibrium asset pricing model with sticky goods prices is developed goods prices are set by monopolistically competitive firms that maximize stock market value equilibria with underutilization of resources excess capacity in some states result in contrast to previous monetary asset pricing models the degree of competition affects capacity utilization monetary policy can affect output and resource utilization in addition to real asset prices depending upon the amount of information available to the monetary authority

electricity prices and consumers long term technology choices evidence from heating investments abstract this paper studies consumers s sensitivity to energy costs at the moment of making a long term energy technology investment the analysis exploits local variation in regulated electricity distribution prices that are persistent over time and therefore a good measure of long term price expectations price impacts are estimated on extensive administrative registry data of private persons acting as home builders in finland during 2006 2011 the results show that electricity prices notably influence builders choices and that electricity tax increases have induced demand for technologies based on renewable energy the results on the comprehensive set of individual level characteristics reveal that technology choices vary systematically across households current dwelling status and the education level have the strongest influence on the choice probabilities price sensitivity is found to be lower for low income households and to vary by the current dwelling status and type of building location

exchange rates and traded goods prices abstract this paper presents a partial equilibrium model of the determination of domestic and export prices by a monopolistic competitive firm the model stresses the role of exchange rate uncertainty and expectations the most important result of the analysis is that the stochastic properties of deviations from the law of one price are crucially affected by the currency of denomination of export prices using data on domestic and dollar export prices of japanese goods i find that deviations from the law of one price are due to exchange rate surprises but also to price staggering and ex ante price discrimination

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

rational inattention and energy efficiency abstractthis paper argues that it will often be rational for consumers to pay limited attention to energy efficiency when choosing among energy consuming durable goods like automobiles or home appliances the reason is that the proper valuation of energy efficiency requires time and effort but differences in efficiency across products will rarely be pivotal to choice when consumers have strong preferences regarding other product attributes the paper first explains why proper valuation of efficiency is difficult even in the presence of government energy labels it next develops a model that shows how to value additional information about energy efficiency in a discrete choice context it then uses data on automobiles to show that consumers experience only small welfare losses when forced to choose a car without detailed information about fuel costs finally the paper discusses the implications of rational inattention for both economic research and public policy

environmental externalities and residential property values externalized costs along the house price distribution this study examines the impacts of animal agricultural facilities on the value of residential housing through a quantile regression framework we are able to show that the estimated price impacts are not uniform across the distribution of housing prices and a statistically significant relationship exists only for houses at or above median price levels these estimated price impacts also increase as the percentile increases for comparison the model also includes the proximity to three other waste facility types industrial solid and septic our dataset features 14 785 single family residential transactions in tippecanoe county indiana over the period 1993 2006 jel q51

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

the effect of vehicle fuel economy standards on technology adoption abstract many countries are tightening passenger vehicle fuel economy standards this paper provides the first empirical evidence on the effects of fuel economy standards on technology adoption we investigate changes in the rate and direction of technology adoption that is the extent to which technology is used to increase fuel economy at the expense of other vehicle attributes we find that recent changes in u s and european standards have both increased the rate of technology adoption and affected the direction of technology adoption producers reduced horsepower and torque compared to a counterfactual in which fuel economy standards remained unchanged we estimate opportunity costs from reduced horsepower and torque to be economically significant relative to the gains from fuel savings