the economics of a blend mandate for biofuels a biofuel blend mandate may increase or decrease consumer fuel prices with endogenous oil prices depending on relative supply elasticities biofuel tax credits always reduce fuel prices tax credits result in lower fuel prices than under a mandate for the same level of biofuel production if tax credits are implemented alongside mandates then tax credits subsidize fuel consumption instead of biofuels this contradicts energy policy goals by increasing oil dependency co 2 emissions and traffic congestion while providing little benefit to either corn or ethanol producers these social costs will be substantial with tax credits costing taxpayers 28 7 billion annually by 2022 copyright 2008 oxford university press

activity based pricing in a monopoly in this article i study the interaction between cost accounting systems and pricing decisions in a setting where a monopolist sells a base product and related support services to customers whose preference for support services is known only to them i consider two pricing mechanisms activity based pricing abp and traditional pricing and two cost accounting systems activity based costing abc and traditional costing for support services under traditional pricing only the base product is priced whereas support services are provided free because detailed cost driver volume information on the consumption of support services by each customer is unavailable under abp customers pay based on the quantities consumed of both the base product and the support services because detailed cost driver volume information is available for each customer likewise under traditional costing for support services the firm makes pricing decisions on cost signals that are noisier than they are under abc i compare the equilibrium quantities of the base product and support services sold the information rent paid to the customers and the expected profits of the monopolist under all four combinations of cost driver volume and cost driver rate information i show that abp helps reduce control problems such as moral hazard and adverse selection problems for the supplier and increases the supplier s ability to engage in price discrimination i show that firms are more likely to adopt abp when their customer base is more diverse their customer support costs are more uncertain their costing system has lower measurement error and the variable costs of providing customer support are higher firms adopt abc when their cost driver rates for support services under traditional costing are noisier measures of actual costs relative to their cost driver rates under abc and when the actual costs of support services are inherently uncertain i also show that cost driver rate information and cost driver volume information for support services are complements although the prior literature views abc and activity based management abm as facilitating better decision making i show that abc and abp a form of abm are useful tools for addressing control problems in supply chains

informational asymmetries strategic behavior and industrial organization one of the most active and exciting areas of economic research over the last several years has been the use of noncooperative games of incomplete information to model industrial competition this work has yielded not only a remarkable number of papers but also several new insights on and explanations of fundamentally important issues the purpose of this paper is to attempt an appreciation and evaluation of this work because most of our individual and joint work since about 1979 has been in this mode it will come as no surprise that we are proponents of this line of research however there are several questions and potential problems that we see as arising in connection with this methodology and we will attempt to address these first a disclaimer we are not attempting a survey of the applications of asymmetric information games aig to industrial organization although we will refer in a highly selective fashion to a number of prominent strands in this literature in particular where any references are provided at all they are typically only to the earliest contributions to a subject even more we do not deal with work in which informational asymmetries are important but the analysis is not game theoretic for example search and price dispersion or the early work on the lemons problem and on moral hazard and adverse selection in insurance markets or with game theoretic treatments that assume complete information i aig methods and applications

the impact of agricultural biotechnology on yields risks and biodiversity in low income countries abstract this paper shows that the current generation of transgenic crop varieties has significant potential to improve economic welfare in low income countries these varieties might increase crop yields in low income countries in cases when pesticides have not been used they will reduce negative health effects of chemicals when they replace them with low transaction costs appropriate infrastructure and access to intellectual property multiple varieties of transgenics will be introduced the gain from transgenics will be reduced and crop biodiversity may be lost when only a small set of varieties is transgenetically modified the adoption of transgenics will also be affected by risk and credit considerations

risk preferences and pesticide use by cotton farmers in china abstract despite that insect resistant bt cotton has been lauded for its ability to reduce the use of pesticides studies have shown that chinese bt cotton farmers continue to use excessive amounts of pesticides using results from a survey and an artefactual field experiment we find that farmers who are more risk averse use greater quantities of pesticides we also find that farmers who are more loss averse use lesser quantities of pesticides this result is consistent with our conceptual framework and suggestive evidence where farmers behave in a loss averse manner in the health domain and place more weight on the importance of health over money in the loss domain

considering macroeconomic indicators in the food before fuel nexus abstract a structural vector autoregression svar model along with a direct acyclic graph is employed to decompose how supply demand structural shocks affect food and fuel markets the results support the hypothesis that fundamental market forces of demand and supply are the main drivers of food price volatility increased biofuel production may cause short run food price increases but not long run price shifts decentralized freely operating markets will mitigate the persistence of any price shocks and restore prices to their long run trends the main policy implications are that oil gasoline and ethanol market shocks do not spillover into grain prices which indicates no long run food before fuel issue in the short run grain prices can spike due to market shocks so programs designed to blunt these price spikes may be warranted

the econometrics of damage control why specification matters the contribution of damage control agents to production differs fundamentally from that of standard inputs lands labor capital this paper develops an econometric model based on the key characteristics of damage control agents and examines its properties it demonstrates that standard production function specifications overestimate damage control agent productivity and have erroneous implications for the evolution of damage control agent productivity and use in response to changing environments e g the spread of pest resistance it also proposes several alternative specifications and discusses methods for estimating them

the impact of bt cotton on poor households in rural india the impact of genetically modified gm crops on the poor in developing countries is still the subject of controversy while previous studies have examined direct productivity effects of bacillus thuringiensis bt cotton and other gm crops little is known about wider socioeconomic outcomes we use a microeconomic modelling approach and comprehensive survey data from india to analyse welfare and distribution effects in a typical village economy bt cotton adoption increases returns to labour especially for hired female workers likewise aggregate household incomes rise including for poor and vulnerable farmers hence bt cotton contributes to poverty reduction and rural development

adoption of agricultural innovations in developing countries a survey this paper reviews various studies which have provided a description and possible explanation to patterns of innovation adoption in the agricultural sector the survey points out that the tendency of many studies to consider innovation adoption in dichotomous terms adoption nonadoption may not be appropriate in many cases where the actual decisions are defined over a more continuous range more attention needs to be given to the socio cultural and institutional environment in area studies so that their interrelation with economic factors affecting adoption can be inferred the presence of several interrelated innovations is another aspect that needs to be considered more carefully in future research since a number of simultaneous decisions may be involved furthermore the possibility of regular sequential patterns in adopting components of a new technological package should be specifically addressed in future studies finally the impact of differential adoption rates on land holding distribution merits attention in future research

simultaneous and sequential price competition in heterogeneous duopoly markets experimental evidence abstract we investigate simultaneous and sequential price competition in duoply markets with differentiated products and random matching of symmetric firms we find that second movers gain from the sequential structure in comparison to simultaneous move markets whereas first movers do not as predicted by the theory there is a significant first mover disadvantage in the sequential game finally we report the results of control treatments varying the matching scheme and the mode of eliciting choices strategy method vs standard sequential play

first mover disadvantages with private information we consider a leader follower game with output quantities as strategies so as to demonstrate the reduced advantages of the stackleberg leader in a stochastic environment with private information at the equilibrium the strategy of the leader reveals to the follower information about the demand in an attempt to signal low demand the leader contracts his output nevertheless unless the leader s information is infinitely noisy the follower can always correctly infer his signal we find a wide range of parameter values over which the follower is better off compared to the leader

the economic effects of the eu biofuel target in this paper we use the cge model dart to assess the economic impacts and optimality of different aspects of the eu climate package a special focus is placed on the 10 biofuel target in the eu in particular we analyze the development in the biofuel sectors the effects on agricultural production and prices and finally overall welfare implications one of the main findings is that the eu emission targets alone lead to only minor increases in biofuel production additional subsidies are necessary to reach the 10 biofuel target this in turn increases european agricultural prices by up to 7 compared to a cost effective scenario in which the eu 20 emission reduction target is reached additional welfare losses occur due to separated carbon markets and the renewable quotas the biofuel target has relatively small negative or even positive welfare effects in some scenarios

does britain or the united states have the right gasoline tax this paper develops an analytical framework to assess the second best optimal level of gasoline taxation taking into account unpriced pollution congestion and accident externalities as well as interactions with the broader fiscal system we provide calculations of the optimal taxes for the us and the uk under a variety of parameter scenarios under our central parameter values the second best optimal gasoline tax is 1 01 gal for the us and 1 34 gal for the uk current tax rates are much lower than this in the us and higher in the uk the calculations are moderately sensitive to alternative parameter assumptions the congestion externality is the largest component in both nations revenue raising needs also play a significant role as do accident externalities and local air pollution potential welfare gains from reducing the current uk tax rate are estimated at nearly one fourth the production cost of all gasoline used in the uk even larger gains could be achieved by switching to a tax on vehicle miles with equal revenue yield for the us the welfare gains from optimizing the gasoline tax are smaller but those from switching to an optimal tax on vehicle miles are very large

features of experimentally observed bounded rationality abstract on the basis of experimental evidence reported in the literature the paper draws conclusions about the bounded rationality exhibited by human economic behaviour among the topics discussed are presentation effects caused by superficial analysis strategic reasoning and strategy construction based on reciprocity and fairness avoidance of circular concepts in step by step strategic reasoning ex post rationality and learning direction theory presence of both adaptive and analytic approaches to repeated decision tasks and the absence of quantitative expectations and optimization in typical repeated game strategies

information sharing and tacit collusion in laboratory duopoly markets i introduction economists have long believed that enhanced information about demand conditions or rival actions can play an important role in facilitating collusion for example because it simplifies detection of chiselers stigler 1964 an extensive theoretical literature examines the incentives for non cooperative firms to share information through a trade association about some uncertain parameter see sakai 1990 1991 for a survey firms in these models may cooperate by sharing information in the trade association even though most authors assume that the firms choose non cooperative strategies in the product market under these conditions vives 1984 shows that with demand uncertainty substitute goods and quantity competition each firm s dominant strategy is to conceal information from its rivals therefore under these conditions non cooperative firms will not find it in their interests to form an information sharing arrangement such as a trade association because non cooperative firms should not wish to share information clarke 1983 392 concludes that information pooling mechanisms like trade associations can be considered prima facie evidence that firms are illegally cooperating to restrict output however kirby 1988 shows that non cooperative firms will want to share information if cost functions are sufficiently quadratic moreover hviid 1989 demonstrates that non cooperative firms will prefer to share information if they are sufficiently risk averse these models typically assume that firms interact once and identify the static subgame perfect nash equilibrium ne of the two stage information sharing game this is sensible when the goal is to focus on a narrow set of non cooperative equilibria because the set of non cooperative equilibria becomes very large in these models in the more complex repeated game however repeated interaction between competing firms seems more relevant for empirical applications especially for providing policy insight for trade associations that permit long term interactions among firms unfortunately empirical work in this area based on field data is challenging because the information different decision makers possess and the corresponding residual uncertainty they face are typically difficult to identify this paper uses a different empirical approach we use a series of laboratory duopoly markets to examine the impact of demand uncertainty on sellers output choices specifically we examine the importance of information sharing in facilitating tacit collusion under conditions of demand uncertainty 1 our experiment employs repeated interaction between fixed pairs of subjects trading the ability to directly test the static models for a more realistic policy relevant study of outcomes in the repeated game 2 our results indicate the extent to which results from static theory carry over to the repeated environment and can help guide future theory for dynamic oligopoly models of information sharing the experiment includes four distinct treatment conditions in the primary treatment sellers face uncertain demand but can eliminate uncertainty through voluntary mutual information sharing three control treatments identify the reasons for voluntary information sharing and determine if it leads to more collusive outcomes the first two control treatments eliminate sellers information sharing opportunities in the first control treatment sellers always remain uncertain about demand when choosing output while in the second control treatment sellers always have perfect demand information we refer to these control treatments respectively as forced no sharing and forced sharing throughout the paper the third control treatment sharply reduces collusion incentives by truncating demand while still allowing voluntary information transmission we refer to this control treatment as the truncated demand treatment the results briefly stated are as follows

technology and the future bioeconomy new discoveries in life sciences and the challenge of climate change are leading to the emergence of the bioeconomy where basic methods of advanced biology are applied to produce a wide array of products while also improving environmental quality the emergence of the bioeconomy is a continuing evolutionary process of transition from systems of mining nonrenewable resources to farming renewable ones this transition benefits from the modern tools of molecular biology that have expanded the human capacity to breed new organisms and utilize them to increase productivity in agriculture and fisheries as well as produce a wide array of products that were extracted in the past this transition is leading to the integration of the agricultural sector with the energy and mineral sectors the introduction of biotechnology has already improved the productivity of medicine as well as agriculture but in the case of agriculture has encountered resistance and regulatory constraints the evolution of the bioeconomy requires continuous public investment in research and innovation as well as the establishment of a regulatory framework and financial incentives and institutions that would lead to continuous private sector investment in the development and commercialization of new products one of the biggest challenges is the development of a regulatory framework that would control possible human and environmental externalities from new biotechnology products and at the same time not stifle innovation jel classifications q1 q2 q3 q4 q5

supply and demand elasticities in the u s ethanol fuel market abstract the market for ethanol has grown from approximately 1 2 billion gallons in 1997 to almost 5 billion gallons in 2006 with the huge increase in ethanol demand in recent years the growth in derived demand for corn has driven up many food prices this paper uses monthly data from 1997 2006 to estimate the market supply and demand for ethanol at the national level the simultaneous determination of the supply and demand curves using two stage least squares allows for the calculation of supply and demand side elasticities which are important results in light of the tremendous growth in this market and recent legislation concerning ethanol

an ethanol blend wall shift is prone to increase petroleum gasoline demand abstract in 2010 the u s environmental protection agency announced a waiver allowing an increase in the fuel ethanol blend limit the blend wall from 10 e10 to 15 e15 justifications for the waiver are reduced vehicle fuel prices and less consumption of petroleum gasoline leading to greater energy security empirical investigations of this waiver using monte carlo simulations reveal an anomaly where a relaxation of this blend wall elicits a demand response under a wide range of elasticities this demand response can actually increase the consumption of petroleum gasoline and thus lead to greater energy insecurity the economics supporting this result and associated policy implications are developed and discussed

biofuel policies and the environment do climate benefits warrant increased production from biofuel feedstocks abstract we examine whether climate benefits warrant policies promoting biofuel production from agricultural crops when other environmental impacts are accounted for we develop a general economic ecological modelling framework for integrated analysis of biofuel policies an economic model of farmers decision making is combined with a biophysical model predicting the effects of farming practices on crop yields and relevant environmental impacts they include ghg emissions over the life cycle nitrogen and phosphorus runoff and the quality of wildlife habitats we apply our model to crop production in finland we find that under current biofuel production technology the case for promotion of biofuels is not as evident as has been generally thought only reed canary grass for biodiesel is unambiguously desirable whereas biodiesel from rape seed and ethanol production from wheat and barley cause in most cases negative net impacts on the environment suggested policies in the us and the eu tend to improve slightly the environmental performance of biofuel production

duopoly information equilibrium cournot and bertrand abstract in a duopoly model where firms have private information about an uncertain linear demand it is shown that if the goods are substitutes not to share information is a dominant strategy for each firm in bertrand cournot competition if the goods are complements the result is reversed furthermore the following welfare results are obtained 1 i with substitutes in cournot competition the market outcome is never optimal with respect to information sharing but it may be optimal in bertrand competition if the products are good substitutes with complements the market outcome is always optimal 2 ii bertrand competition is more efficient than cournot competition 3 iii the private value of information to the firms is always positive but the social value of information is positive in cournot and negative in bertrand competition

food versus fuel what do prices tell us abstract sorting out the impacts of biofuels on global agricultural commodity prices is impossible without turning to data and distinguishing between the short run versus the long run impacts using time series prices on fuels and agricultural commodities the aim is to investigate the long run cointegration of these prices simultaneously with their multivariate short run interactions results indicate no direct long run price relations between fuel and agricultural commodity prices and limited if any direct short run relationships in terms of short run price movements sugar prices are influencing all the other agricultural commodity prices except rice with sugar the number one world input for ethanol results indicate increased ethanol production is potentially influencing short run agricultural commodity prices overall results support the effect of agricultural commodity prices as market signals which restore commodity markets to their equilibria after a demand or supply event shock

competitive pricing in markets with different overhead costs concealment or leakage of cost information this paper experimentally investigates how leaders and followers in a duopoly set prices for two product markets that have different overhead costs in a fully crossed two by two design we manipulate the participants private cost report quality as either low or high representing the extent to which these reports reveal that product markets have different overhead costs we show that when only the leader is given a high quality cost report private cost information of higher quality is better incorporated into market prices that are observable to participants both the leader and follower improve in profits and their prices better reflect the differences in overhead costs because the follower infers information from the leader s prices information leakage in contrast when only the follower receives a high quality cost report the leader s profits and prices do not improve this occurs because the follower conceals cost information when the leader has a low quality cost report

when does a carbon tax on fossil fuels stimulate biofuels a carbon tax is an efficient economic instrument to reduce emissions of carbon dioxide released from fossil fuel burning if designed properly it could also help significantly to promote renewable energy using a multi sector multi country computable general equilibrium model this study investigates under what circumstances a carbon tax would help stimulate penetration of biofuels into the energy supply mix for road transportation in various countries and regions around the world this study shows that a carbon tax cum biofuel subsidy policy where a carbon tax is introduced to fossil fuels and part of the tax revenue is used to finance the biofuel subsidy would significantly help stimulate market penetration of biofuels on the other hand a carbon tax alone policy where the entire tax revenue is recycled to households through a lump sum transfer does not help stimulate biofuels significantly even at higher tax rates although the carbon tax cum subsidy policy would cause higher loss in economic output at the global level as compared to the carbon tax alone policy the incremental loss is relatively small the key policy insight drawn from the study is that if a carbon tax were to be implemented in an economy for the purpose of climate change mitigation recycling part of its revenue to finance biofuel subsidies would significantly help stimulate biofuels

investments into forest biorefineries under different price and policy structures abstract increasing scarcity of oil reserves and the high co2 emissions from using oil have contributed to the development of renewable biofuels pulp and paper mill integrated forest biorefineries offer one important means to increase biofuel production this study analyzes the effects of policies to support biofuel production in the pulp and paper sector we study the relative effectiveness of three biofuel supporting policy instruments namely production subsidy input subsidy and investment subsidy we present a partial equilibrium pulp and paper market model with a biorefinery investment option a numerical model is used to evaluate the impacts of policy instruments on wood prices as well as input choices and investment strategies of pulp and paper industries the data represent the finnish pulp and paper sector we evaluate the values and direct costs of the policy instruments in a situation of exogenous biofuel production targets the direct costs of input and investment subsidies are higher than those of a production subsidy with all the policy instruments finnish pulp and paper mills would invest in wood gasifying technology instead of black liquor based one the number of biorefinery units is dependent on the subsidy type investment and input subsidies are likely to result in more numerous but smaller biofuel production units than a production subsidy with all the policy instruments the demand for wood increases in finland leading to higher wood prices this in turn could reflect negatively on the profitability of the pulp and paper industries to a significant degree the model and the results can be generalized to other countries and markets where integrated pulp and paper mills are operating

the effects of agricultural development policies on income distribution and technological change in agriculture abstract a framework for analyzing the effects of policies on income distribution is introduced for the case where farmers have both discrete adoption decisions relating to fixed cost and continuous adoption decisions relating to land allocation distributional effects depend on the underlying distributions of farm size risk preferences and credit availability absolute and relative equity effects of various policies are shown to depend critically on which of these factors are major barriers to adoption and on the stochastic relationship of returns to various cropping activities a fixed cost subsidy appears to be a dominant policy from an equity standpoint in most cases

the eu 20 20 2020 targets an overview of the emf22 assessment three computable general equilibrium models are used to estimate the economic implications of a stylized version of eu climate policy if implemented at the lowest possible cost the 20 emissions reduction would lead to a welfare loss of 0 5 2 0 by 2020 second best policies increase costs a policy with two carbon prices one for the ets one for the non ets could increase costs by up to 50 a policy with 28 carbon prices one for the ets one each for each member state could increase costs by another 40 the renewables standard could raise the costs of emissions reduction by 90 overall the inefficiencies in policy lead to a cost that is 100 125 too high the models differ greatly in the detail of their results the ets non ets split may have a negligible impact on welfare while the renewables standard may even improve welfare the models agree however that the distortions introduced by total eu package imply a substantial welfare loss over and above the costs needed to meet the climate target the marginal total and excess costs reported here are notably higher than those in the impact assessment of the european commission

cooperation as a result of learning with aspiration levels abstract it is shown that a win stay lose shift behavior rule with endogenous aspiration levels yields cooperation in a certain class of games interaction takes place in many groups markets or locations simultaneously and the aspiration level in each round equals the current population average the class of games includes the prisoner s dilemma and cournot oligopoly and thus yields an explanation for cooperation and collusion

assessing the impact of us ethanol on fossil fuel markets a structural var approach abstract despite the growing importance of biofuels the effect of biofuels on fossil fuel markets is not fully understood we develop a joint structural vector auto regression var model of the global crude oil us gasoline and us ethanol markets to examine whether the us ethanol market has had any impact on global oil markets the structural var approach provides a unique method for decomposing price and quantity data into demand and supply shocks allowing us to estimate the distinct dynamic effects of ethanol demand and supply shocks on the real prices of crude oil and us gasoline ethanol demand in the us is driven mainly by government support in the form of tax credits and blending mandates shocks to ethanol demand therefore reflect changes in policy more than any other factor in contrast ethanol supply shocks are driven by changes in feedstock prices a principle finding is that a policy driven ethanol demand expansion causes a statistically significant decline in real crude oil prices while an ethanol supply expansion does not have a statistically significant impact on real oil prices this suggests that even though us ethanol market is small the influence of us biofuels policy on the crude oil market is pervasive we also show that ethanol demand shocks are more important than ethanol supply shocks in explaining the fluctuation of real prices of crude oil and us gasoline

toward an optimal u s ethanol fuel subsidy abstract enhanced environmental quality fuel security and economic development along with reduced prices of ethanol gasoline blends are often used as justifications for the u s federal excise tax exemption on ethanol fuels however the possible effect of increased overall consumption of fuel in response to lower total price mitigating the environmental and fuel security benefits are generally not considered taking this price response into account the optimal u s ethanol subsidy is derived estimated values of the optimal subsidy reveal that the subsidy s environmental and security benefits are questionable however positive environmental and security benefits from the ethanol tax exemption subsidy may be obtained if the subsidy is combined with an increase in the excise tax on gasoline

subject response to loss in an experimental tournament abstract we present tests for the influence of losing on subsequent behavior in a nongame tournament experiment the results are uniformly insignificant suggesting non convex incentives such as tournaments or quotas do not cause suboptimal behavior among losers as has been asserted

testing assumptions underlying economic research on transgenic food crops for third world farmers evidence from cuba guatemala and mexico abstract transgenic crop varieties tgvs are being promoted as essential for improving small scale third world sstw agriculture most economic research on this topic makes critical untested assumptions including that farmers will choose tgvs over other varieties because tgvs are economically optimal and because farmers are risk neutral profit maximizers we tested these assumptions using data from a survey of 334 farmers in 6 communities in cuba guatemala and mexico in which farmers ranked 4 real and hypothetical maize varieties for eating and sowing our results did not support these assumptions most farmers preferred farmer varieties for sowing and especially for eating avoiding tgvs a preference associated with being risk averse and with non monetary preferences farmers more integrated into modern agriculture were more likely to choose tgvs these results suggest that farmers most in need of support and most important for conserving genetic diversity are least favorable toward tgvs and that alternative ways of improving sstw agriculture should receive more attention

information leakage forces cooperation abstract this paper considers a two person repeated game in which there is a small probability of espionage i e that one or both of the players will be informed of the other s supergame strategy and have a chance to revise his strategy on the basis of this information before the game begins it is shown that in such a game any subgame perfect equilibrium pair of payoffs is pareto efficient provided that the probability of espionage is sufficiently small different from preceding studies the present paper assumes neither collective deviation nor bounded rationality in deriving the result

agricultural biotechnology the promise and prospects of genetically modified crops for millennia humans have modified plant genes in order to develop crops best suited for food fiber feed and energy production the earliest efforts far predating gregor mendel s 19th century discoveries on trait inheritance involved the selective breeding of plants with desirable characteristics but the recombination of dna in offspring was random consequently plant breeding often took decades and frequently yielded crop varieties with unforeseen and undesirable properties today conventional plant breeding remains inherently random and slow constrained by the availability of desirable traits in closely related plant species in contrast agricultural biotechnology employs the modern tools of genetic engineering to reduce uncertainty and breeding time and to transfer traits from more distantly related plants arguments in support of and in opposition to the use of genetically engineered seeds have changed little since the technology emerged in the 1980s on one side critics express concerns that the technology imposes negative environmental effects and jeopardizes the health of those who consume the frankenfoods on the other side supporters emphasize potential gains from boosting output and lowering food prices for consumers they argue that such gains are achieved contemporaneous with the adoption of farming practices that lower agrochemical use and lessen soil