modeling skewness with the linear stochastic plateau model to determine optimal nitrogen rates accurate modeling of skewness is needed to increase the actuarial fairness of crop insurance we test day s conjecture that crop yield skewness becomes negative as nitrogen rates increase and determine how well a linear response stochastic plateau lrsp production function matches the pattern of observed skewness using four long term nitrogen experiments stillwater wheat is consistent with day s conjecture but the skewness for lahoma and altus wheat yields as well as altus cotton yields are not the lrsp assumes normal random effects and can explain only a small part of observed skewness so a new lrsp with skew normal random effects is introduced which comes closer to explaining the observed skewness and should increase the accuracy of nitrogen rate recommendations negative skewness reduced optimal nitrogen rates and positive skewness increased optimal nitrogen rates

designing and rating an area yield crop insurance contract this article documents the design and rate making procedures used in the development of the group risk plan grp the new federal crop insurance product that insures based on area yield the authors of this article worked closely with personnel in the federal crop insurance corporation and others in developing methodological and practical constraints needed in implementing a workable area yield contract grp indemnity payments are made based on percentage shortfalls in actual county yields relative to a forecasted yield historical county yield data are used to develop forecasted yields and premium rates

econometric developments in agricultural and resource economics the first 100 years this article reviews the major contributions of agricultural and resource economists in the area of econometrics over the past 100 years early on a number of agricultural economists were in on the ground floor in terms of developing new econometric methods over time as the economics profession became more empirically oriented agricultural and resource economists increasingly assumed the role of early adopters of new econometric methods even so agricultural and resource economists continue to make useful modifications to econometric techniques in order to adapt the methods to the unique nature of the problems and applications that we study

demand heterogeneity for index based insurance the case for flexible products abstract a substantial literature has analyzed the challenges around weather index insurance yet an important design issue has been generally overlooked most index insurance products have so far been characterized by a one size fits all payout structure intended for a representative farmer at the cost of ignoring considerable heterogeneity in risk profiles this paper provides unique evidence on the ways in which heterogeneity in farmers risk exposure affects their demand for insurance we analyze a set of flexible insurance products against excess rainfall and exploit the substantial variation in insurance portfolios demanded by farmers we explore the relevance of alternative sources of heterogeneity by extending a simple expected utility decision model and relying on structural estimation to test their significance we find important aspects of farmer heterogeneity directly affecting their demand for insurance we quantify the benefits of a flexible scheme by comparing farmer welfare to that achieved under alternative counterfactual insurance options

modeling conditional yield densities given the increasing interest in agricultural risk many have sought improved methods to characterize conditional crop yield densities while most have postulated the beta as a flexible alternative to the normal others have chosen nonparametric methods unfortunately yield data tends not to be sufficiently abundant to invalidate many reasonable parametric models this is problematic because conclusions from economic analyses which require estimated conditional yield densities tend not to be invariant to the modeling assumption we propose a semiparametric estimator that because of its theoretical properties and our simulation results enables one to empirically proceed with a higher degree of confidence copyright 2003 oxford university press

evidence of slowing yield growth the example of swiss cereal yields we analyze trends in crop yields and yield variability of barley maize oats rye triticale and wheat in switzerland from 1961 to 2006 it shows that there have been linear increases in crop yields since the 1960s however yields of barley oats rye triticale and wheat have leveled off in switzerland since the early 1990s which contrasts linear trends in cereal yields that is usually assumed for europe we show a relationship between the introduction of agricultural policy measures towards environmentally friendly cereal production that fostered widespread adoption of extensive farming practices and the observed leveling off of crop yields thus this paper emphasizes that agricultural policy can be an important reason for slowing crop yield growth agricultural policy measures will be one of the key driving forces of future crop yields thus the potential leveling off of crop yields that is indicated in this study should be considered in analyses of future land use and food supply as well as in the evaluation of agri environmental measures and policy reforms

making real progress toward more sustainable societies using decision support models and tools introduction to the special volume academics politicians professionals and the general public are aware that without stewarding our planet s natural resources man is on the pathway towards a global collapse over the next three decades mankind is expected to consume an estimated 140 billion tons of minerals ores fossil fuels and biomass per year three times current consumption social welfare and human wellbeing are threatened with the scarcity of natural resources consequently nations and their societies are also at risk of collapse the readers of this special volume will find a compilation of scholarly research papers with real life applications that take the challenge of proposing decision making models and tools to address sustainability challenges in integrative ways the main focus of this special volume is integration of sustainability dimensions economic social environmental ethical and time into decision support models and to identify pathways to achieve more sustainable societies the majority of the research in this special volume 74 percent focuses on environmental and economic dimensions only 26 percent integrated social dimensions with them methodologically a range of mathematical models and tools are presented to support prescriptive decision making with some descriptive models integrated to support decision makers in solving practical problems across a variety of industries and scenarios the breadth and complexity of issues facing organizations and society requires innovative applications of these methodologies the concerns cover a spectrum ranging from energy to solid waste management a multitude of levels from broad based policy concerns to strategic inter organizational sustainable supply chain management and significantly shop floor operational issues are also covered the variety of problems and solutions exemplifies the potential for modelling and operations research for addressing some of our world s most pressing concerns

testing the stochastic structure of production a flexible moment based approach conventional production function specifications are shown to impose restrictions on the probability distribution of output that cannot be tested with the conventional models these restrictions have important implications for firm behavior under uncertainty a flexible representation of a firm s stochastic technology is developed based on the moments of the probability distribution of output these moments are a unique representation of the technology and are functions of inputs large sample estimators are developed for a linear moment model that is sufficiently flexible to test the restrictions implied by conventional production function specifications the flexible moment based approach is applied to milk production data the first three moments of output are statistically significant functions of inputs the cross moment restrictions implied by conventional models are rejected

insuring eggs in baskets the vast majority of crop and revenue insurance policies sold in the united states are single crop policies that insure against low yields or low revenues for each crop grown on a particular farm this practice of insuring one crop at a time runs counter to the traditional risk management practice of diversifying across several enterprises to avoid putting all of ones eggs in a single basket this paper examines the construction of whole farm crop revenue insurance programs to include livestock the whole farm insurance product covers crop revenues from corn and soybeans and livestock revenues from hog production the results show that at coverage levels of 95 percent or lower the fair insurance premiums for this product on a well diversified iowa hog farm are far lower than the fair premiums for the corn crop alone on the same farm the calculation of premium rates for the whole farm insurance product is derived from a method for imposing correlations first proposed by iman and conover in 1982

heterogeneity and distributional form of farm level yields representing farm level crop yield heterogeneity and distributional form is critical for risk and crop insuranceresearch moststudieshaveusedcountydata understatingbothsystematicandrandomvariation comparison of systematic versus random intra county variation is lacking few studies compare the various distributional forms that have been proposed this study utilizes the extensive potential of government farm level crop insurance data results show that systematic intra county variation is surprisingly strong a newly applied reverse lognormal distribution is preferred when county wide variation is removed but the normal distribution fits surprisingly well in the crop insurance relevant percentiles when county wide variation is not removed representing and accounting for both spatial and temporal heterogeneity is a major problem in agricultural economics and policy analysis due to the fact that most data are aggregated to at least the county level e g gardner and kramer 1986 just and pope 1999 both systematic and random components of crop yields are major factors in intra county farm level heterogeneity that are critical for modeling risk producer behavior and crop insurance participation most studies have either used aggregate at least county level data or relied on relatively few farm level observations the former makes results primarily illustrative while the latter limits statistical significance this article characterizes intra county crop yield heterogeneity both spatially and temporally with the most extensive dataset utilized to date and evaluates a broader set of parametric distributional possibilities than previously

impact of copula choice on the modeling of crop yield basis risk a number of problems in agricultural economics involve modeling joint distributions for which the assumption of multivariate normality may not be warranted yet very little work has been conducted evaluating competing methods for modeling joint dependence we develop a simulation framework to evaluate the bias and efficiency impacts of copula choice in the context of evaluating county to farm basis risk the results suggest significant differences in performance across various copulas and approaches the findings have important implications for risk analysis insurance and policy modeling problems in agriculture regarding the selection of method to model dependence among random variables

a structural decomposition analysis of the emissions embodied in trade abstract the aim of this study is to quantify the driving forces behind the growth of carbon dioxide emissions embodied in trade eet the world input output database is used to estimate eet in 40 countries during 1995 2007 after which a structural decomposition analysis is applied to avoid biases in the results we have used the input output tables in previous year s prices and chained the outcomes in many developed countries the growth of emissions embodied in imports is much higher than the growth of emissions embodied in exports a key reason for this finding is the change in the structure of trade both in intermediate and in final products emerging economies like the bric countries have increased their share in production and trade at the expense of developed countries producers and consumers in developed countries have shifted towards importing a larger share of products from emerging countries this is the distinguishing feature that led to an increase of emissions embodied in imports for developed countries and an increase of emissions embodied in exports for emerging countries these results suggest policy makers to monitor eet more carefully and take the effects of trade on emissions into consideration

are crop yields normally distributed the evidence for nonnormality of crop yields is reassessed three methodological problems are identified in typical yield distribution analyses i misspecification of the nonrandom components of yield distributions ii missreporting of statistical significance and iii use of aggregate timeseries ats data to represent farm level yield distributions one or more of these problems infect virtually all evidence against normality to date the positive contribution of the article is a set of principles that must be followed in any valid investigation of yield normality

crop yield skewness under law of the minimum technology no satisfactory motivation has been forwarded in favor of any crop yield distribution including the normal this article explores the foundations of yield distributions for the law of the minimum resource constraint technology at the plot level of analysis with independent identical uniform resource availability distributions the yield skew is positive whereas it is negative whenever the distributions are normal simulations show how asymmetries in resource availabilities determine skewness it is suggested that a negative yield skew occurs whenever production is tightly controlled so that the left tails of some resources availabilities distributions are thin irrigation may increase yield skewness copyright 2009 oxford university press

the impacts of multiperil crop insurance on indonesian rice farmers and production this article analyzes the effect of multiperil crop insurance policy for risk averse indonesian rice farmers located in tuban and gresik regencies of the east java province based on the model comparative static analysis of a change in policy variables coverage levels and premium subsidies on input use through the coupling wealth and insurance effects are presented the comparative static results are largely ambiguous and left as empirical questions consequently the model is numerically simulated to quantify the effects of different coverage levels and subsidy rates on input use expected net insurance payments and certainty equivalents the empirical analysis shows that mpci crop insurance results in a decline in expected yield for coverage levels above about 82 5 for both regencies furthermore higher subsidy rates amplify the reduction in input use and yield therefore incomplete coverage with relatively low premium subsidies is the best policy to minimize the impact on input use and yield however from the farmers perspective the optimal policy combination results from the highest coverage level and subsidy which offer the largest expected net insurance payments and certainty equivalent

parametric and nonparametric statistical modelling of crop yield implications for pricing crop insurance contracts this article considers alternative methods to calculate the fair premium rate of crop insurance contracts based on county yields the premium rate was calculated using parametric and nonparametric approaches to estimate the conditional agricultural yield density these methods were applied to a data set of county yield provided by the statistical and geography brazilian institute ibge for the period of 1990 through 2002 for soybean corn and wheat in the state of parana in this article we propose methodological alternatives to pricing crop insurance contracts resulting in more accurate premium rates in a situation of limited data

payment limitations and acreage decisions under risk aversion a simulation approach payment limits have played an important role in u s farm policy deliberations for the last thirty years current limits are largely nonbinding proposals to strengthen and enforce limits are currently in discussion we evaluate the likely effects of such proposals on acreage for corn soybeans wheat cotton and rice in several important producing states our results generally indicate that payment limits are unlikely to significantly affect acreage in most cases exceptions occur for cotton and rice where the probability that limits would be binding is much greater and thus more likely to affect production copyright 2009 oxford university press

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

tailored to the extremes quantile regression for index based insurance contract design a new approach for weather index based insurance design based on quantile regression qr to condition the yield index dependency is developed and compared to standard regression technique three conceptual different risk measures i e expected utility expected shortfall and a spectral risk measure are used to evaluate the risk reducing properties of these contracts our findings show that qr is much more powerful in establishing the yield index dependency and lead for all risk measures to a higher risk reduction than the standard technique ordinary least squares ols thus qr leads to a more efficient contract design which is beneficial for both the insurer smaller remaining risk and the insured higher demand and willingness to pay our empirical application is based on a 31 years long time series of wheat yield data from northern kazakhstan

crop insurance valuation under alternative yield distributions considerable disagreement exists about the most appropriate characterization of farm level yield distributions yet the economic importance of alternative yield distribution specifications on crop insurance valuation has not been well documented the results of this study demonstrate that large differences in expected payouts from popular crop insurance products can arise solely from the parameterization chosen to represent yield distributions the results suggest that the frequently unexamined yield distribution specification may lead to economically significant errors in crop insurance policy rating and assessment of expected payouts from policies

the rise in the disability rolls and the decline in unemployment between 1984 and 2001 the share of nonelderly adults receiving social security disability insurance income di rose by 60 percent to 5 3 million beneficiaries rapid program growth despite improving aggregate health appears to be explained by reduced screening stringency declining demand for less skilled workers and an unforeseen increase in the earnings replacement rate we estimate that the sum of these forces doubled the labor force exit propensity of displaced high school dropouts after 1984 lowering measured u s unemployment by one half a percentage point steady state calculations augur a further 40 percent increase in the rate of di receipt

conservation payments under risk a stochastic dominance approach conservation payments can be used to preserve forest and agroforest systems to explain landowners land use decisions and determine appropriate conservation payments it is necessary to focus on revenue risk marginal conditional stochastic dominance rules are used to derive conditions for determining the conservation payments required to guarantee that the environmentally preferred land use dominates an empirical application to shaded coffee protection in the biologically important choco region of west ecuador shows that conservation payments required for preserving shaded coffee areas are much higher than those calculated under risk neutral assumptions further the extant distribution of land has strong impacts on the required payments

are crop yields normally distributed a reexamination this article demonstrates that normality test procedures that include individual detrending of short term panel data can severely reduce the power of normality tests and strongly bias normality tests in a type ii direction an alternative error component implicit detrending procedure is suggested that demonstrates higher power for the distributions examined both procedures are applied to a large data set with normality of yield residuals being rejected assuming normality is shown to reduce potential premium rates for a large number of producers in an existing crop insurance product

the theory of preferential trade agreements historical evolution and current trends the theory of preferential trade agreements pta s or what might be described in policy terms as the general agreement on tariffs and trade gatt article xxiv sanctioned freetrade areas fta s and customs unions cu s has undergone two phases of evolution in two very different modes largely reflecting the contrasting policy concerns of the time in this paper we trace this evolution offering both a historical context and an intellectual coherence to diverse analytical approaches

testing for nonnormality in farm net returns cash returns from farming are expected to be nonnormally distributed under a wide range of joint price yield distributions adequate testing for such nonnormality requires use of proper whitening procedures as well as appropriate statistics with tests and sample sizes commonly employed a false imputation of normality often will be made however positive correlation between skewness and kurtosis reduces the likelihood of associated decision errors these results are illustrated with data for

self protection from weather risk using improved maize varieties or off farm income and the propensity for insurance we investigate how self protection from the adoption of improved maize varieties imv and off farm income affects risk premiums for smallholder maize producers in uganda to unbundle these effects we specify the cost of risk to explicitly capture four risk components mean variance skewness and kurtosis using unique plot level panel data for uganda we estimate and test moments of a flexible production function based on an expanded form of the johnson su family distribution and proceed to simulate the degree of responsiveness of risk premiums and welfare estimates to marginal changes in the share of land under imv and off farm income scenarios of joint adoption of imv accompanied with low and high application of inorganic fertilizer and the effect of off farm income when there is high and low supply of farm labor are examined results show that the use of imv and off farm income substantially reduces risk premiums and the individual effect is much higher under low fertilizer application and high supply of farm labor respectively thus implying that self protection is likely to reduce the propensity for index insurance especially if its design fails to consider the reduction in downside risk

heteroscedasticity or production risk a synthetic view two veins of literature namely production risk literature and stochastic frontier analysis are examined both fields are concerned of output variation the former due to exogenous shocks the latter due inefficiency by covering the literature from both the fields this review suggests that the concept of heteroscedasticity can be utilized to build a synthesis between these mainly separate branches of literature however the synthetic approach brings a challenge how to differentiate between different sources of output variation this challenge is identified as the main obstacle to meaningfully combine the two approaches

two moment decision models and expected utility maximization two moment decision models are consistent with expected utility maximization only if the choice set or the agent s preferences are restricted this paper identifies a restriction which is sufficient to ensure this consistency and confirms that it holds in many economic models the implications for economic analysis are then derived two different approaches to representing an agent s preferences over strategies yielding random payoffs are in wide use under the mean standard deviation ms approach the agent is assumed to rank the alternatives according to the value of some function defined over the first two moments of the random payoff while the expected utility eu criterion assumes that the expected value of some utility function defined over payoffs is used instead the fact that there are these two competing approaches has generated a considerable literature some authors are concerned with the advantages and disadvantages of each while others deal with conditions under which the potentially different approaches would yield the same results or at least approximately so space does not

explaining the decline in the u s employment to population ratio a review of the evidence this paper first documents trends in employment rates and then reviews what is known about the various factors that have been proposed to explain the decline in the overall employment to population ratio between 1999 and 2018 population aging has had a large effect on the overall employment rate over this period but within age group declines in employment among young and prime age adults also have played a central role among the factors with effects that we can quantify based on existing evidence labor demand factors in particular increased import competition from china and the penetration of robots into the labor market are the most important drivers of observed within group declines in employment labor supply factors most notably increased participation in disability insurance programs have played a less important but not inconsequential role increases in the real value of state minimum wages and in the share of individuals with prison records also have contributed modestly to the decline in the aggregate employment rate in addition to the factors whose effects we roughly quantify we identify a set of potentially important factors about which the evidence does not yet allow us to draw clear conclusions these include the challenges associated with arranging child care improvements in leisure technology changing social norms increased use of opioids the growth in occupational licensing and declining labor market fluidity our evidence driven ranking of factors should be useful for guiding future discussions about the sources of decline in the aggregate employment to population ratio and consequently the likely efficacy of alternative policy approaches to increasing employment rates

asymmetry partial moments and production risk partial moment functions are proposed as a flexible way to characterize and estimate asymmetric effects of inputs on output distributions methods for econometric estimation of partial moment functions and tests for input symmetry and location scale distributions are presented a monte carlo study demonstrates properties of proposed tests a study of ecuadorian potato production illustrates the methods hypotheses of input symmetry and location scale are rejected a risk value model based on partial moments implies that fertilizer is risk increasing and fungicides and labor are risk reducing in potato production whereas an expected utility model based on full moments has the opposite implications

testing day s conjecture that more nitrogen decreases crop yield skewness whilecontroversysurroundsskewnessattributesoftypicalyielddistributions abetterunderstandingis importantforagriculturalpolicyassessmentandforcrop insuranceratesetting day 1965 conjectured that crop yield skewness declines with an increase in nitrogen use at low levels but not at higher levels employing four corn yield experimental plot datasets we investigate the conjecture by introducing a a flexible bayesian extension of the just pope technology to incorporate skewness and b a quantilebased measure of skewness shift bayesian estimation provides strong evidence in favor of negative skewnessatcommercialnitrogenratesandforday sconjecture therewasweakerevidenceinfavorof positively skewed cotton yield and little evidence in favor of the conjecture the results are confirmed by the quantile based measure we also find evidence that skewness becomes more negative upon moving from corn after corn to corn after soybean

more than mean effects modeling the effect of climate on the higher order moments of crop yields this article proposes the use of moment functions and maximum entropy techniques as a flexible approach for estimating conditional crop yield distributions we present a moment based model that extends previous approaches and is easily estimated using standard econometric estimators predicted moments under alternative regimes are used as constraints in a maximum entropy framework to analyze the distributional impacts of switching regimes an empirical application for arkansas mississippi and texas upland cotton demonstrates how climate and irrigation affect the shape of the yield distribution and allows us to illustrate several advantages of our moment based maximum entropy approach

veterans labor force participation what role does the va s disability compensation program play we explore time trends in the labor force participation of veterans and non veterans and investigate whether they are consistent with a rising role for the department of veterans affairs disability compensation dc program which pays benefits to veterans with service connected disabilities and has grown rapidly since 2000 using 35 years of march cps data we find that veterans labor force participation declined over time in a way that coincides closely with dc growth and that veterans have become more sensitive to economic shocks our findings suggest that dc program growth has contributed to recent declines in veterans labor force participation

will cotton make a comeback in mali with the decline of cotton especially in the marginal cotton areas farmers have been using more of the cotton financed inputs on the cereals the cotton para statal company cmdt has made a virtue out of this recommending diversification for these regions following the world price spike in 2010 the malian government responded with a substantial price increase for cotton in 2011 of 38 to rejuvenate the malian sector this article looks at the impact of this price policy in the cotton economy and the potential of new cereal technology and marketing strategy to raise incomes and facilitate the diversification given the importance of the marketing decision of selling later after the recovery of cereal prices from the harvest collapse a discrete stochastic programming model was developed for three stage decision making then the recent changes in the cotton economy and government fertilizer subsidies were analyzed along with the introduction of the new technology marketing of sorghum cotton and maize continue to dominate the economy but the combined sorghum technology marketing increases farmers incomes by 16 to 21 and eases the return to normal cotton prices after the 2011 price spike as well as the removal of the fertilizer subsidies

assessing sustainability performance of global supply chains an input output modeling approach abstract measuring the sustainability performance of supply chains is fundamental to sustainable supply chain management sustainability performance is usually evaluated from multiple aspects within the triple bottom line framework with globalization supply chains have also been characterized by the complex and global natures ignoring the multidimensional and transnational features imposes challenges on the performance assessment of global supply chains gscs to resolve this issue we propose an input output modeling approach based on the multi region input output mrio model and the data envelopment analysis dea technique which is able to account for the multidimensional characteristic of supply chains in a global context two indices are introduced to measure the status and evolvement of environmental sustainability performance of gscs we apply the proposed approach to empirically examine the environmental performance of gscs of the manufacturing sectors in 16 major economies during 2005 2014 the average environmental inefficiency of the economies was considerable and roughly 40 of the pollution could potentially be reduced along gscs overall the environmental performance of gscs averagely rose by 20 6 during the study period with fluctuations and regional sectoral heterogeneities observed

u s soybean yields estimation and forecasting with nonsymmetric disturbances national average soybean yields are skewed with a relatively high chance of low yields maximum likelihood estimates support this hypothesis revised forecasts which account for skewed yields are positioned higher than forecasts based on the illusion of a symmetric distribution also yield instability has been increasing steadily the standard deviation of the soybean yield distribution is twenty five percent higher in the late 1980s than it was in the early 1970s

the planting real option in cash rent valuation after entering into a farmland cash rent contract in the fall a tenant farmer has flexibility over the spring crop choice and the input application level failure to account for these options will bias estimates of what farmers should pay to rent land applying monte carlo simulation methods this study investigates the option values for these choices a multivariate gaussian copula mgc is employed to account for dependence among yields and prices results show that the average cash rent valuation for the real option approach is 33 6 higher than that for the conventional net present value npv method in which the input intensity option is 0 9 crop planting sequence is shown to impact the real option value

ecology sustainability and environment as capital abstract the idea of environment as capital has found widespread support in both the economic and ecological literature it is often suggested in a related sustainability literature that natural capital should remain intact if possible the popularity of this approach to exploring the human environment relationship is due in part to the way it is seemingly legitimised by ecological theory and practice this legitimation is important for emerging areas of human environment study such as ecological economics because ecology and other natural sciences have often dismissed economic constructions of the environment however a closer examination of the state of contemporary ecology suggests that there are problems with an ecological legitimation of the environment as capital approach first ecology itself is a troubled discipline and its ability to provide a comprehensive theory of human environment interactions is limited second emerging ecological discourse tends to undermine the ecological rationale for many natural capital related resource management recommendations this does not mean that the environment as capital concept is without considerable heuristic power it does imply however a need to return to a social construction of the environment in which different environmental possibilities are valued in terms of their potential contribution to human well being

is there a viable market for area based crop insurance the performance of area yield insurance and farm level multiple peril crop insurance is analyzed for cotton and soybean production in georgia and south carolina the analysis improves on many previous studies by utilizing actual farm level yield data and by comparing the two types of insurance products not only for actuarially fair premium rates but also for actual unsubsidized and subsidized premium rates results suggest that even in heterogeneous production regions area yield insurance may be a viable alternative to farm level insurance when premium rates for farm level insurance contain large positive wedges

calibration based predictive distributions an application of prequential analysis to interest rates money prices and output some techniques of probability forecasting are applied to time series data on interest rates money stock consumer prices and output a sequential method for debiasing recalibrating predictive distributions and outcomes is developed and the authors estimated sequences of unadjusted and recalibrated distributions are tested for calibration after recalibration the calibration hypothesis cannot be rejected for most of the time series and forecast horizons furthermore traditional point forecasts can be improved when the forecasts are derived from recalibrated distributions copyright 1989 by the university of chicago

does disability insurance receipt discourage work using examiner assignment to estimate causal effects of ssdi receipt abstract we present the first causal estimates of the effect of social security disability insurance benefit receipt on labor supply using all program applicants we use administrative data to matc

u s farm policy and the volatility of commodity prices and farm revenues a dynamic three commodity rational expectations storage model is used to compare the impact of the federal agricultural improvement and reform fair act of 1996 with a free market policy and with pre fair policies results suggest that fair did not lead to significant increases in long run price volatility or revenue volatility the main impact of pre fair relative to the free market regime was to substitute government storage for private storage in a way that did little to support prices or to stabilize farm incomes results also indicate that u s grain market volatility in 1995 2000 was due to fundamental market forces and not to fair copyright 2002 oxford university press

do indicators have politics a review of the use of energy and carbon intensity indicators in public debates abstract in this paper we analyse how energy and carbon intensity indicators which have huge popularity among policy makers are framed in the discourse of think tanks consulting groups and other stakeholders what emerges from the analysis of public documents reports and policy briefs is that intensity indicators are often framed uncritically and unreflectively our analysis highlights three fundamental themes that emerge from public debates around intensity indicator first efficiency and intensity often framed in terms of productivity are used equivalently second intensity is perceived as a measure of win win sustainability in which economic growth can be decoupled from energy consumption without a substantial restructuring of the productive system third the analysis suggests that energy and carbon intensity indicators are attractive for policy makers especially in the so called developing world because they can be used to design political targets e g paris agreement without questioning the right to economic growth of powerful emerging economies like the brics the paper shows the strong limitations of intensity indicators and their potential do misguide policymakers

a quantitative model for environmentally sustainable supply chain performance measurement abstract the development of robust mechanisms for supply chain performance measurement have been identified as an integral step needed for the transition towards sustainable supply chain systems and a greener global economy however measuring the environmental performance of supply chains is a challenging task due to several factors such as the lack of standardised methodologies and the inherent multi criteria nature of the problem by leveraging the capability of a multi regional input output framework to handle the complex and global nature of supply chains the current work presents a robust environmental sustainable performance measurement model underpinned by industrial lifecycle thinking as a result some theoretical insights are provided and an empirical application of the model to the metal products industry of the brics brazil russia india china and south africa nations undertaken in an attempt to address some of the methodological and applied measurement challenges in particular this allowed the modelling of carbon emissions trends within and between the brics nations and with the rest of the world over a 20 year period 1992 2011 as well as providing an opportunity to hypothesis on their future carbon emissions performances specific analyses of the metal product industry showed that demand represents the main driver for the increasing carbon footprint however the overall decline in reported carbon footprint was due to improvements in emissions intensity and efficiency gains induced by technology the study further assesses the effects of imports and economic growth on carbon footprint and discusses the implications of the study to sustainability transition processes in the brics nations

technological change and risk management an application to the economics of corn production the paper investigates the linkages between technological change and production risk with an application to corn the effects of technology on risk exposure are analyzed we define technological progress to be risk increasing risk decreasing if it increases decreases the relative risk premium the analysis is applied to panel data from wisconsin research stations conditional moments including mean variance and skewness of corn yield grain moisture and corn profit are estimated for different sites we investigate how the trade off between expected return and the risk premium varies over time and over space the empirical results indicate that technological progress contributes to reducing the exposure to risk as well as downside risk in corn production although this effect varies across sites they also stress the role of the relative maturity of corn hybrids as a means of managing risk

investigating the performance of different estimation techniques for crop yield data analysis in crop insurance applications we investigate the performance of the ordinary least squares ols m mm and the theil sen ts estimator for crop yield data analysis in crop insurance applications using monte carlo simulations more specifically the performance is assessed with respect to trend estimation prediction of future yield levels and the estimation of expected indemnity payments in agreement with earlier findings other estimators are found to be superior to ols in simple regression problems if yield distributions are outlier contaminated and heteroscedastic while this conclusion is also valid for subsequent applications such as yield prediction and the estimation of expected indemnity payments the difference between the considered estimators becomes less distinct for these applications we find particularly the m estimator to be a good compromise between high breakdown very robust estimators and the very efficient ols estimator because no regression technique dominates all others in all applications and scenarios for error term distributions our results underline that the choice of the estimation technique should be dependent on the purpose of the crop yield data analysis however alternative estimators such as m mm and ts estimator can reduce and bound the risk of unreliable or inefficient crop yield data analysis in crop insurance applications

on technological change in crop yields technological changes in agriculture tend to alter the mass associated with segments or components of the yield distribution as opposed to simply shifting the entire distribution upwards we propose modeling crop yields using mixtures with embedded trend functions to account for potentially different rates of technological change in different components of the yield distribution by doing so we can test some interesting and previously untested hypotheses about the data generating process of yields for example 1 is the rate of technological change equivalent across components and 2 are the probabilities of components constant over time our results technological change is not equivalent across components and probabilities tend not to have changed significantly over time have implications for modeling yields we find estimated conditional yield densities are quite different when unique trend functions are embedded inside the mixture components versus estimating the same mixture with detrended data also we prove different rates of technological change in different components lead to nonconstant variance with respect to time i e heteroscedasticity we present two applications of the proposed yield model the first application considers climate determinants of component membership where our results are consistent with the literature for climate determinants of yields the second application compares the proposed yield model to usda s current rating methodology for area yield crop insurance contracts and finds the proposed model may lead to more accurate rates

actuarial fairness of crop insurance rates with constant rate relativities increased availability and demand for low deductible crop insurance policies have increased focus on crop insurance rating methods actuarial fairness cannot be achieved if constant multiplicative factors are used to determine how premiums change as coverage levels increase a comparison of premium rates generated by the factors used by the two most popular crop insurance products with those generated by a standard yield distribution shows that the popular insurance products overcharge for low deductible policies in most counties this overpricing may explain why large premium subsidies were required to induce farmers to move from low deductible to high deductible policies beginning in 2001 crop insurance is by far the most popular risk management tool used by the u s crop producers in 2003 the u s crop insurance program insured more than 200 million acres representing more than 37 billion in value with total premium of over 3 14 billion the two most popular crop insurance products are actual production history aph which provides insurance against low yields and crop revenue coverage crc which is a revenue insurance product both of these products offer coverage in 5 increments from 65 to 85 of expected yield or revenue beginning with the 2001 crop year congress greatly increased subsidy levels to induce producers to purchase more insurance coverage producers responded as expected for example only 2 3 of kansas wheat was insured at levels in excess of 65 in 1998 this proportion rose to 71 6 in 2003 this policy change has increased focus on the methods used by the risk management agency rma of usda to set insurance rates at higher coverage levels aph premium rates are calculated by multiplying the premium rate at the 75 coverage level by a rate

sustainability assessment of u s final consumption and investments triple bottom line input output analysis the u s final demand categories such as household consumption private fixed investments government purchases and investments and export of goods and services have a wide range of environmental economic and social impacts analysis of these impacts termed as the triple bottom line tbl stimulated a tremendous interest by policy makers over the last decade therefore current research aims to analyze the tbl of u s final demands from a systems perspective to accomplish this goal the supply and use tables published by the u s bureau of economic analysis are merged with a range of environmental economic and social metrics the results show that household consumption has the largest indirect tbl sustainability impacts compared to other final demand categories with shares that range between 43 and 88 industrial sectors including manufacturing utilities agriculture construction transportation and mining are generally found to be responsible for the highest impacts for most of the environmental impact categories service sectors generally have the highest impacts on the economic and social indicators of sustainability analysis results also indicate that while meeting the household demand agriculture utilities and manufacturing sectors have relatively more environmental impacts than their contributions to gross domestic product gdp whereas service sectors contribute to gdp with a higher share than their environmental burdens furthermore it is envisioned that significant reductions in environmental footprints of u s households can be achieved if environmental policies that aim to reduce the household consumption are also supported with sustainable growth through greener and resource efficient economy

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

estimating bivariate yield distributions and crop insurance premiums using nonparametric methods modelling crop yield distribution is crucial in crop insurance premium setting the correlation between different crop yields due to rotations or systemic risks requires estimation of joint yield distribution for multiple crops in this article we apply a nonparametric method to estimate bivariate yield distributions using farm level yield data of wheat and corn in shandong province in china then the simulated yields are used to evaluate the expected indemnity of one traditional and one hypothetical crop insurance programme our results reveal that the nonparametric bivariate method is very flexible in shaping the yield probability density functions to estimate local idiosyncrasies and correlation between two crops it is also feasible to simulate the nonparametric yield distributions at a satisfying level of accuracy the simulation results show that the hypothetical two crop insurance contract can be more affordable to farmers than traditional individual crop insurance contracts

population matters in ecological economics abstract it is an axiom of ecological economics that resource depletion and environmental pollution depend on the number of people and how many goods and services each consumes modified by the technological efficiency of production the paper reviews some studies quantifying the contribution of human numbers to environmental impact it warns against playing this factor off against that of high consumption in rich countries it asks whether from the environmental point of view complacency about either present or predicted population size is warranted the answer depends both on fertility and mortality assumptions and on constraints such as resource and food availability the concept of cultural carrying capacity would aid societies in determining their optimal population when account is taken not only of subsistence but of quality of life a population control toolkit for both rich and poor societies is sketched and some controversial coercive policy possibilities analysed

bayesian estimation of possibly similar yield densities implications for rating crop insurance contracts the agricultural act of 2014 solidified insurance as the cornerstone of u s agricultural policy the congressional budget office 2014 estimates that this act will increase spending on agricultural insurance programs by 5 7 billion to a total of 89 8 billion over the next decade in light of the sizable resources directed toward these programs accurate rating of insurance contracts is of the utmost importance to producers private insurance companies and the federal government unlike most forms of insurance agricultural insurance is plagued by a paucity of spatially correlated data a novel interpretation of bayesian model averaging is used to estimate a set of possibly similar densities that offers greater efficiency if the set of densities are similar while seemingly not losing any if the set of densities are dissimilar simulations indicate that finite sample performance in particular small sample performance is quite promising the proposed approach does not require knowledge of the form or extent of any possible similarities is relatively easy to implement admits correlated data and can be used with either parametric or nonparametric estimators we use the proposed approach to estimate u s crop insurance premium rates for area type programs and develop a test to evaluate its efficacy an out of sample game between private insurance companies and the federal government highlights the policy implications for a variety of crop state combinations consistent with the simulation results the performance of the proposed approach with respect to rating area type insurance in particular small sample performance remains quite promising

estimation of mixture models using cross validation optimization implications for crop yield distribution modeling a critical issue in identifying an appropriate characterization of crop yield distributions is that the best fitting distribution in an in sample framework is not necessarily the best choice out of sample this study provides a methodology for estimating flexible and efficient mixture models using cross validation that alleviates many of these associated model selection issues the method is illustrated in an application to the rating of group risk insurance products results indicate that nonparametric models often fit best in sample but are inefficient and consistently overstate true rates and vice versa for parametric models the proposed model provides unbiased rates and also has desirable efficiency properties

toward a normative theory of crop yield skewness while the preponderance of empirical studies point to negative crop yield skewness in a wide variety of contexts the literature provides few clear insights on why this is so the purpose of this paper is to make three points on the matter we show formally that statistical laws on aggregates do not suggest a normal yield distribution we explain that whenever the weather conditioned mean yield has diminishing marginal product then there is a disposition toward negative skewness in aggregate yields this is because a high marginal product in bad weather states stretches out the left tail of the yield distribution relative to that of the weather distribution turning to disaggregated yields we decompose unconditional skewness into weather conditioned skewness plus two other terms and study each in turn

spatial pattern of yield distributions implications for crop insurance crop insurance is similar to flood and hurricane insurance in that spatially correlated weather tends to cause violations of the independence assumption ideally one would seek to pool uncorrelated risk drawn from the same distribution in crop insurance this article proposes a testing procedure for the cross sectional pooling of group units and empirically analyzes whether the proposed test improves out of sample rating performance we utilize a balanced panel of u s county level corn yields for 510 counties and the results of an out of sample crop insurance rating performance exercise provide economic significance to the proposed pooling methodology and results

spatio temporal modeling of agricultural yield data with an application to pricing crop insurance contracts this article presents a statistical model of agricultural yield data based on a set of hierarchical bayesian models that allows joint modeling of temporal and spatial autocorrelation this method captures a comprehensive range of the various uncertainties involved in predicting crop insurance premium rates as opposed to the more traditional ad hoc two stage methods that are typically based on independent estimation and prediction a panel data set of county average yield data was analyzed for 290 counties in the state of parana brazil for the period of 1990 through 2002 posterior predictive criteria are used to evaluate different model specifications this article provides substantial improvements in the statistical and actuarial methods often applied to the calculation of insurance premium rates these improvements are especially relevant to situations where data are limited

land resilience and tail dependence among crop yield distributions we propose and empirically test a simple model to shed light on the nature of interactions between weather land quality and yield the conceptual model posits substitution relations between water stress metrics and soil quality as well as a soil conditioned threshold water stress level beyond which soil cannot buffer crop yields the model implies that yield yield dependence should vary as growing conditions vary in comparison with intermediate growing conditions yield yield dependence should strengthen when growing conditions are either very good or very poor county yield data strongly support substitution between soil and benign water availability levels but complementarity between soil and beneficial heat variables our estimated model provides qualified support for the hypothesis that better land is more resilient to water stress we estimate a pseudo copula that nests the gaussian copula finding strong evidence of left tail dependence among yields our formal model and empirical findings corroborate others concerns about the appropriateness of current usda rate setting methodologies which posit constant state conditional rank correlations implicitly assumed by use of the gaussian copula an application to aggregate crop yield rate setting suggests that current methods underprice area yield and whole farm premiums applying our empirical model to medium range weather projections under a climate change scenario for the northern great plains we infer that systemic yield correlations will increase in future years

relaxing heteroscedasticity assumptions in area yield crop insurance rating this article focuses on the effect of differing heteroscedasticity assumptions on derived premium rates of area yield crop insurance tests of the proportional and absolute heteroscedasticity assumptions are conducted using both in sample and out of sample measures our results suggest that arbitrarily imposing a specific form of heteroscedasticity or homoscedasticity in insurance rate calculations limits actuarial soundness our results have practical implications for the federal crop insurance programs as we reject the traditional rating assumptions for many cotton regions and lower yielding higher risk corn and soybean counties but not in the heart of the cornbelt copyright 2011 oxford university press