optimal temporal policies in fluid milk advertising this study develops an approach to obtain optimal temporal advertising strategies when consumers response to advertising is asymmetric using this approach optimal strategies for generic fluid milk advertising in new york city are determined results indicate that pulsed advertising policies are significantly more effective in increasing demand than a uniform advertising policy sensitivity analyses show that the optimal advertising policies are insensitive to reasonable variations in interest rates and the inclusion of milk demand seasonality in the model also less asymmetric responses to advertising are found to result in shorter optimal pulsing cycles and reduced intensity of advertising pulses copyright 2000 oxford university press

supply storage and service reliability decisions by gas distribution utilities a chance constrained approach this paper explores the trade offs among purchases storage and service reliability decisions faced by natural gas distribution utilities the short term demand for natural gas fluctuates because of the weather to encourage load leveling the pipeline transmission companies that supply the utilities use a demand contract that charges utilities based on their peak day needs and often charge for a minimum daily purchase requirement whether that purchase is made or not the policy variables available to the utility include increasing its storage capacity and providing interruptible service to some customers thereby lowering reliability of service there are also technological constraints on the maximum storage gas flows to explore these trade offs a chance constrained cost minimization problem is formulated two decision rules for gas purchases and storage operation are examined in these rules an initial decision is made at the beginning of each month about either the level of purchases or the level of

substitution effects in cvm values there is increasing recognition that statistical estimates of the average willingness to pay for environmental programs may be biased by the failure of respondents or of the statistical methodology to consider the effect of substitute programs and goods we design and implement a cvm survey that estimates the impact of substitution effects on the willingness to pay for an environmental program we find a statistically significant impact and suggest that the set of potential substitutes is very large

distribution of research gains in multistage production systems comment in a recent paper freebairn davis and edwards hereafter fde have examined an interesting and neglected aspect of the distribution of benefits from research agricultural production is seen to comprise three stages input supply farm production and farm to retail marketing fde have explored the distribution of the benefit stemming from a downwards shift in the supply function at any one of the stages they conclude these benefits are distributed according to the elasticities of consumer demand and supply facing each stage furthermore under the special assumptions they employ this distribution is independent of which of the three supply functions is shifted by research they conclude albeit with due caution that the choice of agricultural research projects should not be limited to farm production research alone especially in view of the cost shares of purchased inputs and marketing services in the retail value of food in fact they argue they farmers may receive greater benefits from off farm oriented research than from farm oriented research p 39 this finding has potentially important implications for agricultural research policy it immediately spurs one to ask whether research funded by the farmer or the fisc might have neglected opportunities for research related to farm inputs or marketing to reach their result fde assume a all supply and demand curves are linear b research induces parallel shifts in supply curves c farmers cannot substitute nonfarm inputs for inputs supplied by farmers in production of the farm product and d marketing firms cannot substitute marketing inputs for raw farm products in the production of retail commodities the purpose of this note is to emphasize the importance of these elasticities of factor substitution in determining the distribution of research benefits between the three stages to do this we use a simple but general two factor model in which we focus attention on the elasticity of factor substitution between marketing services and raw farm products in the third stage marketing this model is not restricted to linear supply and demand curves nor to an elasticity of substitution of zero we maintain the assumptions of parallel shifts of supply curves induced by research and a perfectly elastic supply of marketing services in a revision of fde s application to the u s hog industry the distribution of research benefits is shown to depend crucially on the elasticity of factor substitution their result that such distribution is independent of the stage in which research shifts the supply curve downwards follows only for the special case in which that elasticity is zero this is clearly a restrictive assumption a reexamination of some of the policy issues raised by fde once the assumption is relaxed would seem to be warranted

extending cost benefit analysis for energy investment choices abstract although cost benefit analysis is still widely practised because it addresses real and continuing problems the technique has been frequently called into question the present paper identifies three major limitations in the technique and offers suggestions for improvements while costs and benefits of energy investments have several dimensions cba attempts to give all effects an economic value this often requires arbitrary and subjective judgments which have discredited the technique it is proposed that cba should be extended from the single economic dimension to include three others environmental technical and the analysis of risk it is suggested that important subjective judgments should be made by the ultimate political decision maker and not by the analyst

estimation of distance decay functions to account for substitution and spatial heterogeneity in stated preference research in a site selection choice experiment various hypotheses are tested related to spatial heterogeneity in willingness to pay wtp for environmental improvements spatial heterogeneity is measured through distance decay effects substitute sites inside and outside the experiment s choice set and spatial trend variables we demonstrate that distance decay functions differ between users and nonusers and across study sites also the distance to substitutes outside the choice set explains spatial variation in wtp we show that further extending the model with spatial trend variables reveals additional spatial heterogeneity in choices accounting for spatial heterogeneity patterns results in significantly different wtp estimates for environmental improvements jel q25 q51

prices and quality effects in cross sectional demand analysis a conceptual clarification of the sources and meaning of cross sectional price variability is used to motivate a theoretical and econometric framework for the estimation of cross sectional demand functions quality effects are distinguished from supply related price variability to identify cross sectional demand for disaggregated food commodities an empirical application using data from the 1977 78 nationwide food consumption survey indicates that parameter differences resulting from a failure to adjust cross sectional prices for quality effects are likely to be small for relatively homogenous disaggregated food commodities in demand analysis with cross sectional household budget data it is usually assumed that prices are constant allen and bowley prais and houthakker george and king given this assumption engel functions are estimated where expenditure or quantity is regressed on income or total expenditures family size and other demographic characteristics the assumption that cross sectional price effects are absent or are captured adequately by spatial and temporal dummy variables has not been evaluated empirically whether cross sectional price effects can be treated in this manner has implications for the specification of cross sectional demand functions as well as the estimation of engel functions there is a considerable literature on estimating price elasticities with cross sectional data most of the applications utilize timeseries cross sectional data annual or quarterly household consumption surveys and

demand systems estimation with microdata a censored regression approach demand systems estimation increasingly makes use of household level microdata mainly to measure the effects of demographic variables data based on these household expenditure surveys present a major estimation problem for any given household many of the goods have zero consumption implying a censored dependent variable techniques which do not take this censored dependent variable into account will yield biased results we utilize a censored regression approach that is computationally simple consistent and asymptotically efficient the results are then presented and compared with those obtained using an uncensored technique

some generalized mixture distributions with an application to unemployment duration compounding or mixture distributions provide a rich class of models for applications ranging from models of heterogeniety measurement error distribution of stock returns and income to models of unemployment duration some very general mixtures are considered which include many new mixture models and also provide a unified method of organizing and comparing previously considered models as well as a test of heterogeneity these models are used to analyze cps unemployment duration data a heterogeniety interpretation of the mixture models explains the discrepancy between implications of search theory and patterns observed in aggregate unemployment data copyright 1987 by mit press

optimal strategic petroleum reserve policies a steady state analysis a simple model is presented which allows us to determine the optimal size fillup and drawdown rates for a strategic petroleum reserve spr under a variety of supply and demand conditions the optimal policy variables are determined by minimizing an analytic expression which we derive for the expected insecurity cost rate to the u s due to uncertainty in supply of imported oil the oil market is modeled in terms of an elastic demand curve and two levels of supply which alternate according to a stationary continuous time markov process the spr policy is characterized by a fixed fillup rate up to the reserve s capacity when supply is at its normal level and a fixed drawdown rate during shortages the insecurity cost rate being minimized includes consumer welfare loss due to price hikes reserve holding cost and capital appreciation of the reserve base case results and sensitivity analysis are presented and compared to results obtained by previous approaches these comparisons suggest that the proposed model can reasonably approximate the more computationally demanding stochastic dynamic programming formulation the main advantage of the new approach is that it permits extensive sensitivity analysis which is important given the quality of the data

seasonality in the consumer response to milk advertising with implications for milk promotion policy permitting seasonal variation in the goodwill effect in measuring the impact of fluid milk advertising on milk sales in new york city improved the statistical significance of the estimating equation the allocation of generic advertising dollars according to optimization rules during the period 1979 81 would have resulted in a 9 percent increase in returns to dairymen supplying the new york city market harmonic variables are used to account for seasonality a pascal distribution is used to account for the decay structure and goodwill elasticities are estimated to indicate the impact of generic advertising on sales

bargaining to preserve a unique ecosystem the role of anticipatory investments to establish stronger bargaining positions abstract a forester and a conservation organization bargain over the commercial exploitation or preservation of a forested tract of land with unique ecological characteristics the forester can improve its bargaining position by preparing a portion of the land for future timber production prior to negotiations between the two however doing so decreases the preservation value of the forest as well as the compensation the conservation group is willing to pay to preserve the forest the analysis suggests that the forester will begin preparing the land for timber production prior to negotiations only when the value of the land in timber production is significantly lower than the preservation values of the conservation group

consumer promotion and purchase timing the case of cheese the dynamics of cheese purchases is analysed by estimating a series of econometric models of duration based on a 170 week household panel besides purchase quantity and price data information with respect to coupon use and household demographic characteristics are used in a variety of models which build upon each other in terms of assumed distribution of interpurchase time effect of previous purchases role of demographic characteristics and effect of unobserved interpurchase time heterogeneity likelihoodratio tests clearly reject the null hypothesis that coupon use has no impact on cheese purchase timing

advertising information and product quality the case of butter this study examines the roles of cholesterol information and advertising in explaining consumption trends for fats and oils focusing on butter results suggest increased consumer awareness of the health effects of blood cholesterol has contributed to the secular decline in butter consumption in canada although consumers responses to negative information appear to outweigh their responses to positive information the industry advertising campaign launched in 1978 by the dairy bureau of canada has had a positive effect on butter demand

optimal pricing strategies for a cluster of goods own and cross price effects with correlated tastes contingent valuation methods are used to identify observed and unobserved preferences of goods and services we apply these methods in the context of multivariate probit analysis to compute willi

complements substitutes budget constraints and valuation this study employs a multi program contingent valuation cvm design tosimultaneously assess the value of three ecosystem conservation programsin alberta canada the design is different from most other cvm designsand has several different features including the natural incorporation ofdirect reminders of substitute complementary programs and budgetconstraints in contrast to the findings of other studies two of the environmentalprograms appear to be complements and other combinations of the programssuggest an absence of substitution effects the multi program model ismore informative and robust in terms of theoretical validity and expectedrelationships with demographic and recreational characteristics of therespondents

coupon redemption and the demand for frozen concentrated orange juice a switching regression analysis a switching regression model was estimated and used to study the impact of florida department of citrus coupon promotional programs on the demand for frozen concentrated orange juice the empirical results show that discounts and information provided by coupons were effective in increasing the demand for fcoj and that the fdoc s coupon programs had positive impacts on the probability of using coupons for purchasing fcoj moreover different types of coupon promotions had different impacts and coupon users and nonusers demonstrated different degrees of response to price changes

household demand for convenience and nonconvenience foods states the budget shares are generally more responsive to prices than to real total expenditure additionally the quantities demanded of convenience and nonconvenience foods are generally more sensitive to changes in income and own prices than to changes in cross prices with regard to demographic variates primary users of convenience foods are white households with employed household managers less than 35 years of age

improving project cost estimation by taking into account managerial flexibility project costs tend to be higher than depicted by budgets irrespective of the quality of the project management this indicates that the budgets are not established in a way which is consistent with how projects are run good budgets should on average lead to zero cost overruns the purpose of this paper is to discuss how project costs if they are based on models can be better estimated by taking into account how projects are actually run in particular how managerial flexibility adds value to a project the purpose is not to advocate better ways of running a project but to obtain better estimates of what projects cost given the way they are run

on price indices in the almost ideal demand system a number of papers have discussed the relationship between the almost ideal demand system aids and its linear approximation la aids in this paper it is shown that if the prices in the system are normalized to one the aids and la aids representations are identical at the point of normalization also at the point of normalization the expressions for price and expenditure elasticities from both systems are identical

demand for food commodities by income groups in indonesia an analysis of the structure of demand was performed on household data classified into income groups for urban indonesia a demographically augmented linearized almost ideal demand system was used to estimate the structural parameters of the demand equations endogenous switching regression techniques yielded unbiased and consistent demand parameter estimates for the low income group which had a large number of zeros for some food groups standard seemingly unrelated equation techniques were used to estimate the demand parameters for the other income groups the results showed demands for the medium to high and high income households to be responsive to prices income and demographic variables demands for the medium to low income households were responsive to income and prices only demands for low income households were responsive to income and prices of rice and fish only

an economic evaluation of market development programmes for us dairy products abstract this study measured the effectiveness of us dairy export promotion programmes on increasing foreign demand and enhancing producers revenues an import demand equation based on panel data was used to test whether export promotion has a positive and significant impact on us dairy exports the effects of various promotion scenarios on the dairy market were then simulated and benefit cost ratios bcrs for these programmes were estimated there were three key findings first the combined effort of public and private dairy export promotion expenditures had a positive and statistically significant impact on demand for us dairy products in the world market the findings indicated that export promotion stimulated total dairy exports by 4 14 billion pounds on average per year which represented 55 8 of total exports second us dairy export promotion has been highly profitable for the nation s dairy farmers the calculated bcrs based on assumed elasticity of supply ranged from a low of 8 54 for th

intertemporal allocation of capital costs in electric utility capacity expansion planning under uncertainty this paper concerns marginal cost pricing in a capacity expansion problem for the electric utility industry we develop a characterization of equipment selection and marginal capital cost allocation based on an optimal capacity plan in the context of either a finite discretely distributed stochastic demand forecast or in the deterministic case of multiple users identified by temporal considerations in either case a two stage linear program with recourse is shown to result the main purpose of this paper is to conduct an analysis in order to determine a marginal cost pricing strategy for sharing capital costs given an optimal capacity plan and to provide insightful economic interpretations our results also generalize a special case previously studied to demonstrate how a marginal cost pricing strategy may result in some of the capacity costs being borne by off peak users

electricity planning under uncertainty risks margins and the uncertain planner abstract the uncertainty of plant performance and unpredictable demand for electricity has always been a problem for power system planners this consideration has come to dominate all others and this article presents a methodology which incorporates many of the uncertainties of power system planning in one model this model is then used to show that proposals to greatly lower planning margins entail high risks the effect of uncertainty on plant mix is shown to lead to greater installation of middle merit plant price regulation as a means of equilibrating supply and demand under uncertainty is shown to be of limited but distinct application

a stochastic dynamic programming model for scheduling of offshore petroleum fields with resource uncertainty abstract norwegian deliveries of natural gas to europe have grown considerably over the last years additionally plans involve even greater supplies introducing major gas fields as the troll field the market for natural gas may to a large extent be viewed as a contractual market this is normally explained by the big investments involved in development and transport in such a perspective the supplier s planning problem of scheduling fields and pipes may prove important in order to be able to meet contractual agreements this paper describes a model of stochastic dynamic programming type which may be viewed as a first attempt in solving this type of problem the main focus in this model is on project scheduling and resource uncertainty each project s production profile is viewed as a stochastic variable then a possible goal could be to minimize expected deviation from a given predicted contract profile we use the term spsp stochastic project scheduling problem to refer to our problem besides a simplified description of the mathematical model the paper also describes some tests with model examples these examples are constructed to obtain some interesting non intuitive effects the paper concludes with some remarks on complexity and speedup possibilities

investigating household purchase timing decisions a conditional hazard function approach the purchase timing decision is an important component of the dynamics of a household s purchase behavior this decision is influenced by marketing and other variables and the modeling of this dependence has recently received attention in the literature in this paper we build on previous studies and develop a comprehensive stochastic model that incorporates the major factors influencing interpurchase times specifically we use a generalized version of cox s proportional hazard model to test among competing probability distributions for the interpurchase times while incorporating effects due to marketing variables observed household characteristics and unobserved heterogeneity across households the empirical finding from analyzing the iri coffee data suggests that the interpurchase times cannot be adequately described by probability distributions such as exponential erlang 2 or weibull the effects of unobserved heterogeneity are significant and they impact the estimates of the effects of the covariates we also find that a nonparametric procedure for estimating the effects of unobserved heterogeneity provides the best overall fit to the data and yields covariate estimates that are more consistent with prior expectations our model is validated by replicating the substantive empirical findings on an additional product category

factors affecting the timing of purchasing of butter margarine and blends a competing goods analysis the purchase dynamics of a subset of food fats and oils are investigated using event history analysis applied to a panel of u s households the consumer behavior examined is the switching between purchases of butter margarine and butter margarine blends across purchase occasions we find that price previous purchases seasonality and household size and composition affect product switching probability

energy planning under uncertainty implications for coal processing and oil stocking policy abstract this study presents a method for quantifying the benefits of various ways of anticipating energy shortages the method is applied to coal liquefaction and oil stocking the study concludes that uncertainty about future energy supplies can improve the prospects for coal processing the results for oil stocking are consistent with actions already taken by government indicating that the assumption and methodology of the study are consistent with revealed preferences

a multivariate polya model of brand choice and purchase incidence in this paper we develop an integrated stochastic model of purchase timing and brand selection which incorporates the influence of marketing mix variables seasonality and trend and also allows for various individual choice mechanisms our approach rests on the assumptions of a zero order choice process a poisson timing process and purchase rates following a multivariate gamma distribution over the population the scale parameters of which vary according to marketing activities and time the resulting model is a multivariate polya process and the distribution of brand choice probabilities turns out to be a generalized dirichlet distribution thus most currently used zero order models can be considered to be special cases of this approach furthermore we derive a number of market diagnostics which provide insights into market structure and demonstrate the model s use for marketing strategy simulation based on extensive testing of the underlying hypotheses we finally validate the model using empirical data and show that it fits the market in question

the calculation of research benefits with linear and non linear specifications of the demand and supply reply this paper provides a comparison of research benefits for linear and nonlinear constant elasticity nlce specifications of supply and demand with a pivotal supply shift framework the comparison allows for a sensitivity test of results to different values for demand and supply elasticity the main finding is that the values of the gross annual research benefits calculated for the nlce specification are larger than those calculated for the linear specification with price elastic supply but are smaller with price inelastic supply the analysis suggests that the use of an nlce specification and a pivotal shift due to research is usually preferable to use of a linear supply curve with pivotal shift

the impact of technical change scale effects and forward ordering on u s fiber demands this paper estimates a complete system of input cost shares in u s textile production using time series data and a linear logit specification incorporating the impact of technical change and scale effects on derived demands for natural and manmade fibers the specification accounts for forward ordering dynamics in the textile industry technical change has decreased natural fiber use in u s textile mills in favor of manmade fibers decomposition analysis of economic factors affecting long run use of natural versus manmade fiber indicates that nonprice factors account for 70 of the decline in long run natural fiber use

co2 gdp and ret an aggregate economic equilibrium analysis for turkey there is a worldwide interest in renewable electricity technologies rets due to growing concerns about global warming and climate change as an eu candidate country whose energy demand increases exponentially turkey inevitably shares this common interest on ret this study using an aggregate economic equilibrium model explores the economic costs of different policy measures to mitigate co2 emissions in turkey the model combines energy demands capital requirements and labor inputs at a constant elasticity of substitution under an economy wide nested production function growing energy demand triggered by economic growth is met by increased supply and initiates new capacity additions investment into ret is encouraged via the incorporation of a endogenous technological learning through which the ret cost declines as a function of cumulative capacity and b a willingness to pay wtp function which imposes the wtp of consumers as a lower bound on ret installation the wtp equation is obtained as a function of consumer income categories based on data gathered from a pilot survey in which the contingent valuation methodology was employed the impacts of various emission reduction scenarios on gdp growth and ret diffusion are explored as expected ret penetration is accelerated under faster technological learning and higher wtp conditions it is found that stabilizing co2 emissions to year 2005 levels causes economic losses amounting to 17 and 23 of gdp in the years 2020 and 2030 respectively

the demand for dairy products structure prediction and decomposition this article presents an analysis of the demand for dairy products first the structure of dairy product demand is estimated using the household food consumption survey data under the assumption of a two stage budgeting procedure a complete demand system for food incorporating demographic effects is estimated next using the demand relations estimated from cross section data prediction interval tests utilizing time series data are performed for milk and butter last factors affecting consumption are classified into economic and demographic effects and a decomposition of the causes of changes in demand over time is performed

what is it about organic milk an experimental analysis auction experiments were used to examine demand relationships and willingness to pay wtp for organic rbst free no antibiotics used and conventional milk elasticities showed strong substitute and complement relationships between organic rbst free and no antibiotics varieties the sum of the latter two s premiums were not significantly different than the organic premium suggesting diminishing marginal utility for added attributes results from a two stage heteroskedastic tobit model demonstrated that wtp premiums for the varieties differ significantly by demographics and beliefs regarding the conventional version these suggest market segments for rbst free and no antibiotics versions could succeed alongside organic benefiting consumers and producers copyright 2007 oxford university press

determinants of price elasticities for private labels and national brands of cheese an almost ideal demand system model is developed and used to estimate price elasticities for us cheese sold at retail growing consumption of cheese coupled with fierce competition between private labels and national brands serves as motivating factors for this study per capita consumption of cheese grew by 75 during 1980 2004 and private labels captured a rising share of this growth private labels today account for 35 of market share national brands for the remaining 65 kraft accounts for 45 of national brands but price increases for kraft brands led to a sizeable price gap between its brands and private labels this gap helped to stimulate growth of private labels marketing managers seek to capitalize on both growing cheese sales and price gaps for brands relevant information for marketing managers is consumer sensitivity to price changes this study uses 69 weeks of scanner data with consumers segmented by income levels to derive price elasticities for both lower and higher income consumer

substitution effects and spatial preference heterogeneity in single and multiple site choice experiments a novel discrete choice experiment dce design allows testing of substitution effects based on the framing of and distances to substitute sites the same ecosystem services and biodiversity provided at different sites are valued independently in single site dces and simultaneously in a multiple site dce using an identical experimental design site specific utility functions are estimated with and without controlling for spatial preference heterogeneity framing choices as alternative projects at single or multiple sites significantly influences substitutability between sites choice behavior and welfare estimates distance decay displays significant heterogeneity in different directions from the valued sites and between urban and rural areas

consumption process and multiple valuation of landscape attributes abstract environmental valuation can be seen as a process which evolves as individuals reflect on their consumption experience in this paper we consider how environmental values could change as the subject has reached the end of the consumption process a split sample comparison is conducted for estimating the values tourists give to a set of landscape attributes the first subsample was taken on site as subjects were on a tour contemplating the landscape of the island of gran canaria canary islands the second subsample was contacted at the airport when individuals were about to leave the tourist enclave since landscapes are complex environmental goods we utilize and compare a multiple contingent valuation cv approach with the stated preference approach of contingent ranking the results show that the influence of the consumption experience depends on the valuation method and the consideration of interaction effects in the model the valuation functions were not stable across both sites for most of the models considered and some of the attributes changed their values between the two points of the consumption process interaction effects were more relevant with the contingent ranking model suggesting that cv is a more limited approach in a context of multiple valuation

optimal control of generic fluid milk advertising expenditures optimal expenditures of the new york state milk promotion program are determined for three markets spending level in new york city and albany should be reduced by about 10 while that for syracuse should be increased three times further there exists an optimal seasonal advertising pattern which reflects the seasonal pattern of the class 1 differential in addition the optimal spending level and seasonal pattern of the state promotion program depends on those of the national program thus coordination between the two promotional units is essential to achieve optimality generic dairy promotion is big business dairy farmers now invest over 200 million annually in promoting the consumption of milk and dairy products nonoptimum allocations of funds miss opportunity to achieve high returns the possibility of potential losses emphasizes the importance of understanding the economics of dairy promotion the continuing effect of advertising on sales after the original period of expenditure is aptly summarized by waugh s statement that old advertisements never die they just fade away the lingering impact of advertising suggests the use of a dynamnic setting in which to explore promotion issues thus far most of the atten

directional heterogeneity in wtp models for environmental valuation many studies in the stated preference literature on environmental valuation do not include the effects of substitutes and distance in willingness to pay wtp models in spite of the relevance of these effects in aggregation and benefit transfer heterogeneity in the availability of substitutes over space may cause multidirectional distance effects in wtp as a result disregarding this spatial heterogeneity may lead to biased estimators of the distance effect and associated wtp values cameron 2006 in this paper we demonstrate that distance decay is subject to significant directional effects which tend to be related to differences in the availability of substitutes across the study area we apply a straightforward methodology to account for such spatial heterogeneity in choice experiments and assess the effect on wtp for improvements in ecosystem services in a lake district we model distance decay effects whilst controlling for heterogeneity between users and non users and non use related wtp reasons the directional effects result in significantly different wtp estimates different market sizes reflecting the population with positive wtp and differences in total wtp up to 32

valuing the multidimensional impacts of environmental policy theory and methods a theoretically consistent framework is developed for valuing the multidimensional impacts of environmental policy conventional benefit estimates are shown to be biased because of the presence of substitution and complementarity effects in valuing policy impacts procedures are developed for implementing a valid framework consistent with theory empirical results indicate significant substitution effects in valuing environmental conditions across different geographic regions

fluid milk purchases a multivariate tobit analysis we formulate an econometric model of fluid milk expenditures taking into account two important characteristics expenditures may be censored at zero and may be interdependent across milk type censoring of fluid milk expenditures is addressed with a generalized tobit system estimator interdependence of milk expenditures is examined through a likelihood function with no restrictions on elements of the engel curve error covariance matrix expenditure function parameters are estimated using a march 1991 to march 1992 u s consumer panel

effectiveness of fluid milk advertising since the dairy and tobacco adjustment act of 1983 an econometric model pooling monthly cross sectional and time series data is estimated to measure the impact of national and regional generic fluid milk advertising the estimated model shows that the effectiveness of advertising has increased since the implementation of the dairy adjustment act gains in fluid milk sales attributed to milk advertising are estimated sales gains for both the pre and post act periods are shown along with the gains associated with parameter changes in the post act periods marginal advertising responses are derived

the demand for meat and fish in spain urban and rural areas abstract the aim of the paper is to explain to what extent meat consumption patterns in spain are different in rural and urban areas and which are the factors explaining differences and similarities a demand system using cross section data from the latest spanish national survey has been estimated unit values have been used instead of market prices and price and quality effects have been obtained the main conclusion is that meat consumption patterns in urban and rural areas are not really different as regards economic factors some small income and price effect differences have been found specially for fresh pork and fish responses to changes in income and price are higher for fresh pork consumption in rural areas and for fish in urban areas

contingent valuation and the activation of environmental norms abstract this paper uses contingent valuation cvm as the context in which to explore the implications of a model of altruistic norm activation a model is presented which provides a framework for thinking about the factors that individuals consider when formulating their responses to cvm questions and the processes by which they bring such factors together the activation of personal environmental norms and hence positive willingness to pay depends on four main categories of belief awareness and acceptance of environmental need consequences of personal action responsibility for personal action and acceptance of policy initiatives the model is illustrated with a qualitative case study and some of the implications for cvm are considered in light of these findings it is argued that whilst notions of fairness may not present problems from a demand prediction economic standpoint such notions may be more problematic for the cost benefit analysis use of results

do voluntary biotechnology labels matter to the consumer evidence from the fluid milk market this article examines the effects on the demand of voluntary labeling for the use of genetically modified growth hormone for retail fluid milk using supermarket scanner data retail fluid milk tracks one of the first biotechnology products approved is fairly standardized and ubiquitous and allows for cross sectional differentiation between labeled and unlabeled products and between conventional and organic brands the results indicate that voluntary labeling increases the demand for recombinant bovine growth hormone free milk in addition the estimated effects of labeling appear to have increased over time innovations through biotechnology enable agricultural producers to reduce production costs and or enhance product quality for many livestock and crop commodities at the same time however these innovations may affect the demand for the products that utilize those commodities many individuals for example are concerned about potential risks to human health although by no means all consumers have such concerns burton metcalfe and smith heiman just and zilberman the use of the recombinant bovine growth hormone rbgh in milk production has been a particular concern for some consumers as approximately one third of the united states dairy herd about 3 million dairy cows currently receive rbgh supplements monsanto product labeling particularly with respect to the provision of health and environmental information is increasingly being used to provide information about product characteristics such as biotechnology content that

the trade and welfare impact of australian quarantine policies the case of pigmeat we analyze the trade and welfare impact of quarantine measures imposed by australia on imports of pigmeat in particular we account for changes to australia s pigmeat quarantine policy over time including those changes related to the recent resolution of a wto dispute between australia and the european union using a random utility model and applying it to corner solutions in import decisions tariff equivalents by major trading partner are estimated for the different pigmeat quarantine regimes implemented by australia during the period 1988 2009 the welfare impact on consumers producers and foreign exporters is computed using a partial equilibrium model calibrated on the econometric estimates the quarantine regimes have a strong effect on trade and welfare with a tariff equivalent above 113 of average real world prices over the period analyzed

the silence of the lambdas a test of the almost ideal and rotterdam models during the past decade the linear approximate la almost ideal demand system and the rotterdam model have been adopted by agricultural economists as the demand systems of choice in most applications the apparent explanation is that the two models are both second order locally flexible and compatible with demand theory they have identical data requirements and are equally parsimonious with respect to parameters and both are linear in the parameters while the two models are thus equally attractive in most respects and indeed appear very similar in structure they lead to different results in some applications this article develops a test of each against the other in an illustrative application to u s meat demand the almost ideal model is rejected while the rotterdam model is not

a comparison of stated preference methods for environmental valuation this paper presents an empirical comparison of contingent valuation cvm and choice experiments which are used to value environmental quality changes both of these methods require individuals to state their preferences for environmental qualities however choice experiments differ from cvm in that environmental attributes are varied in an experimental design which requires respondents to make repeated choices between bundles of attributes the empirical application involved the effect of environmental quality changes arising from forest management practices on recreational moose hunting values significant differences were found between the values derived from the two methods however detailed examination of the implied choice behaviour suggested that respondents ignored substitute recreation areas in the cvm question restricting the choice experiment model to consider only the one site where quality was varied resulted in welfare estimates similar to the cvm model this highlights the importance of substitutes in environmental valuation and suggests that choice experiments may be more appropriate than cvm in some cases