household level spillover effects from biofuels evidence from castor in ethiopia the indirect effects of biofuels are mostly considered negative in this paper we argue that there may be a positive indirect effect of biofuels on food security and poverty using micro level evidence and a matched plot pair design through which we control for plot and farmer characteristics we show that the introduction of castor production for biofuel in a poor country as ethiopia can significantly improve food productivity of rural households who produce raw material for biofuel production this spillover seems particularly linked to enhanced access to inputs and technical assistance which were provided as part of biofuel feedstock production contracts our results thus document another mechanism through which biofuels may influence smallholders food security a mechanism that did not receive attention so far

production contracts and productivity in the u s hog sector this article measures the impact of contracting on partial and total factor productivity and the production technology of u s hog operations a sample selection model accounts for the fact that unobservable variables may be correlated with both the operators decision to contract and farm productivity results indicate that the use of production contracts is associated with a substantial increase in factor productivity and represents a technological improvement over independent production results also identify determinants of farmers decisions to contract and other factors influencing farm the rapid increase in the use of production contracts is a notable feature of the structural change taking place in the us hog industry between 1992 and 1998 the portion of feeder pig to finish hog operations using production contracts increased from 11 to 34 while the share of output produced under contract increased from 22 to 63 mcbride mcbride and key production contracts offer several potential advantages over independent production that could explain their growing prevalence contracts may serve to lower transaction costs associated with search negotiation and transfer reduce asymmetric information between growers and processors about product quality improve coordination of product delivery and lower income risk for growers in addition contracting may raise farm productivity by improving the quality of managerial inputs by speeding the transfer of technical information to growers or by facilitating growers access to credit thereby permitting the adoption of newer more efficient technologies in this article we focus on identifying and measuring the farm level productivity gains if any that can be attributed to contracting the recent growth in contracting does not necessarily imply that contracts are associated with higher farm productivity the increase in the use of contracts may have been propelled

producer price risk and quality measurement risk averse farmers in the produce industry grow a product whose market price is often quite unpredictable shippers or other intermediaries shield the farmer from much of this price risk however actual contracts between growers and shippers vary considerably across commodities in the residual price risk growers face we hypothesize that imperfect quality measurement results in a moral hazard problem and that price provides additional information regarding quality as a consequence an efficient contract does not shield growers from all idiosyncratic price risk we examine this hypothesis for the case of fresh market tomatoes

partial vertical integration risk shifting and product rejection in the high value export supply chain the ghana pineapple sector summary high value export supply chains hold potential to improve smallholders welfare but their relative production inefficiency and moral hazard problems can cause exporters to prefer vertically integrated plantation production however pineapple exporters in ghana produce both for their own account and purchase from smallholders we hypothesize that vertical integration is only partial because exporters face large market risks that smallholders surprisingly are better able to absorb we show empirically that exporters average rejection rate of export quality fruit is high and varies in response to unanticipated fluctuations in european demand these results support the hypothesis and are consistent with theories of partial vertical integration but not the standard principal agent paradigm

the wage effects of high performance work organization in manufacturing an unresolved question about now widespread innovative work systems such as teams and quality programs is whether they influence wage determination this study examines that possible association in manufacturing the author uses data from the 1997 national establishment survey that allow examination of how new work systems affected not only employees who were directly involved in them but other workers as well the key finding is that for core blue collar manufacturing employees higher wages were associated with high performance work organization hpwo systems while higher skill levels and computer based technologies were associated with higher wages the key mechanism appears to have been productivity gains independent of skill and technology that were shared via various across the board wage payment systems hpwo systems appear to have increased managers wages as well although through different channels the author finds no evidence that hpwo related wage gains led to greater wage inequality amon

rice farmers preferences for fairtrade contracting in benin evidence from a discrete choice experiment abstract private standards such as fairtrade have emerged as a response to consumer civil society and corporate concerns about the production conditions of imported food many studies have investigated the welfare implications of smallholder participation in fairtrade schemes and consumers willingness to pay for fairtrade and other labelled products on the other hand no study has yet investigated farmers preferences for fairtrade and other private standards such insights would be valuable to improve the efficiency of certification schemes and ensure that they are tailored to farmers needs using a choice experiment this study investigates the preferences of smallholder rice farmers in benin for fairtrade and organic standards and compares the value of three types of contracts domestic fairtrade and fairtrade organic the results indicate that farmers positively value contracts but prefer domestic over fairtrade contracts because the former involve fewer requirements at current market prices farmers are willing to accept a fairtrade contract that includes fertiliser and child labour restrictions and a social premium but they are not willing to accept a fairtrade organic contract that completely prohibits chemical input use the results imply that adding organic requirements to fairtrade contracts may undermine the adoption and spread of fairtrade certification in the beninese rice sector

the transition to modern agriculture contract farming in developing economies recent years have seen considerable interest in the impact of contract farming on farmers in developing countries motivated out of belief that contract farming spurs transition to modern agriculture in this article we provide a thorough review of the empirical literature on contract farming in bo

contract farming and smallholder incentives to produce high quality experimental evidence from the vietnamese dairy sector in emerging markets for high value food products in developing countries processing companies search for efficient ways to source raw material of high quality one widely embraced approach is contract farming but relatively little is known about the appropriate design of financial incentives in a small farm context we use the example of the vietnamese dairy sector to analyze the effectiveness of existing contracts between a processor and smallholder farmers in terms of incentivizing the production of high quality milk a framed field experiment is conducted to evaluate the impact of two incentive instruments a price penalty for low quality and a bonus for consistent high quality milk on farmers investment in quality improving inputs statistical analysis suggests that the penalty drives farmers into higher input use resulting in better output quality the bonus payment generates even higher quality milk we also find that input choice levels depend on farmers socio economic characteristics such as wealth while individual risk preferences seem to be less important implications for the design of contracts with smallholders are discussed

contract farming in staple food chains the case of rice in benin abstract in this paper we analyze the impact of smallholder participation in a contract farming scheme in the rice sector in benin we use data from a cross sectional farm household survey and different propensity score matching estimations to reveal how participation in a contract farming scheme affects smallholder rice production we find that contract farming results in expansion of the rice area intensification of rice production increased commercialization of rice and higher farm gate prices and ultimately contributes to rice output growth and increased income our findings imply that contract farming can contribute to upgrading the rice supply chain and the development of the rice sector in benin promoting and supporting the spread of contract farming schemes in the sector might be an effective way to contribute to reaching the government goals of expanding rice production to become self sufficient and improving rice quality to compete with imported rice while there is a large empirical literature on contract farming in high value and commodity export sectors studies on contract farming in staple food sectors are very scarce our results document that contract farming for staple food crops can be sustainable and benefit smallholder farmers which is against theoretical expectations that contracting for staple food crops is not feasible because of contract enforcement problems that stem from a low value of produce low storage and transport costs and a larger number of buyers in the chain our study contributes to understanding the role that contract farming might play in the much needed upgrading of domestic and staple food crop sectors in developing countries

explaining personality pay gaps in the uk using the british household panel survey we estimate the effect on pay of each of the big five personality traits for employed men living in the uk we add to the existing literature by estimating the role of factors such as education and occupation in explaining personality pay gaps by allowing the personality traits to affect wage differently across occupations education levels and other workers characteristics and by investigating personality pay gaps for high and low paid workers we find that openness to experience is the most relevant personality trait in explaining wages followed by neuroticism agreeableness extroversion and conscientiousness openness and extroversion are rewarded while agreeableness and neuroticism are penalized but the openness pay gap is totally explained by differences in worker characteristics particularly education and occupation

the welfare effects of trade in phytomedicines a multi disciplinary analysis of turmeric production summary international trade in medicinal herbal products is growing while value chains are becoming more complex and governed by a range of public and private standards there is a debate over the extent to which phytomedicine production can be beneficial for farmers in low and middle income countries more generally there are varied views about the extent to which small farmers are disadvantaged by stringent public health and private consumer standards in northern markets for agricultural products this paper proves a comparative analysis of value chains using case studies of turmeric production in india it marries a qualitative investigation of turmeric producing sites in india with an investigation into the chemical quality of various turmeric products the aim of the paper is to understand the way that varied structure and governance of value chains changes the benefits to both producer and consumer when production is for the organic northern market we found evidence of a captive value chain where the lead firm requires strict adherence to conditions of production and processing prices for farmers were relatively stable at a reasonably high level in contrast where farmers were producing for local markets including the major auction at erode prices were volatile and farmers bore considerable risk we found that competition and volatility in the market based chain can lead to turmeric adulteration and contamination both intentional and unintentional our case study suggests that many small turmeric farmers would find it difficult to meet both public and private health standards in contrast to some academic literature that argues that public health standards do not discriminate against small farmers more than this our study adds to the discussion of the impact of standards suggesting clear consumer benefits in northern markets however there are also indications that only larger and more dynamic farmers can participate in the lucrative phytomedicine trade as such our study tentatively supports previous literature suggesting that the application of standards in northern markets lead to increasing farmer differentiation

contract farming configuration smallholders preferences for contract design attributes while contract farming cf can enhance smallholders income in developing countries empirical research on the motivation of smallholders to participate in cf is scarce this paper explores farmer preferences for particular contract design attributes we combined analytical hierarchy process and discrete choice experiments to investigate the importance of contract design attributes on the basis of data collected among potato farmers in ethiopia we found that input market uncertainty is more important than output market uncertainty in smallholders decision to participate farmers tend to minimize their risk by opting for the buyer firm above the state and ngos as providers of seed inputs and technical assistance the results imply that the success of a cf scheme depends on the willingness of the firm to incorporate the preferred contract design attributes institutional intervention in the input market could induce agribusiness firms to offer attractive contracts for smallholders

competition and coordination in liberalized african cotton market systems abstract private operators now dominate input supply crop buying and ginning activities in many african cotton sectors varying levels of competition are observed but greater levels of competition are not necessarily associated with better system performance this paper explores this phenomenon drawing on the liberalization experience of ghana mozambique tanzania uganda zambia and zimbabwe while the capacity of the state to support markets remains weak there may be tradeoffs between the level of competition and the degree of coordination achieved between players within a sector different sectoral structures are observed with a different role for the state appropriate for each

farmer participation in supermarket channels production technology and efficiency the case of vegetables in kenya supermarkets are gaining ground in agrifood systems of many developing countries while recent research has analyzed income effects in the small farm sector impacts on productivity and efficiency have hardly been studied we use a meta frontier approach and combine this with propensity score matching to estimate treatment effects among vegetable farmers in kenya participation in supermarket channels increases farm productivity in terms of meta technology ratios by 45 we also find positive and significant impacts on technical efficiency and scale efficiency supermarket expansion therefore presents opportunities for agricultural growth in the small farm sector which is crucial for poverty reduction in africa copyright 2012 oxford university press

biofuels and food security micro evidence from ethiopia abstract there is considerable controversy about the impact of biofuels on food security in developing countries a major concern is that biofuels reduce food security by increasing food prices in this paper we use survey evidence to assess the impact of castor production on poor and food insecure rural households in ethiopia about 1 3 of poor farmers have allocated on average 15 of their land to the production of castor beans under contract in biofuel supply chains castor production significantly improves their food security they have fewer months without food and the amount of food they consume increases castor cultivation is beneficial for participating households food security in several ways by generating cash income from castor contracts they can store food for the lean season castor beans preserve well on the field which allows sales when farmers are in need of cash or food spillover effects of castor contracts increases the productivity of food crops increased food crop productivity offsets the amount of land used for castor so that the total local food supply is not affected

agroindustrialization through institutional innovation transaction costs cooperatives and milk market development in the east african highlands abstract some small holders are able to generate reliable and substantial income flows through small scale dairy production for the local market for others a set of unique transaction costs hinders participation cooperative selling institutions are potential catalysts for mitigating these costs stimulating entry into the market and promoting growth in rural communities trends in cooperative organization in east african dairy are evaluated empirical work focuses on alternative techniques for effecting participation among a representative sample of peri urban milk producers in the ethiopian highlands the variables considered are a modern production practice cross bred cow use a traditional production practice indigenous cow use three intellectual capital forming variables experience education and extension and the provision of infrastructure as measured by time to transport milk to market a tobit analysis of marketable surplus generates precise estimates of non participants distances to market and their reservation levels of the covariates measures of the inputs necessary to sustain and enhance the market policy implications focus on the availability of cross bred stock and the level of market infrastructure both of which have marked effects on participation the velocity of transactions in the local community and inevitably the social returns to agroindustrialization

spillover effect between the regional and the national housing markets in the uk tsai i c spillover effect between the regional and the national housing markets in the uk regional studies this study uses regional and national data from the uk housing market to analyse the spillovers between these markets and to test whether a ripple effect exists in uk housing prices cross market return spillovers are determined by performing spillover indices an analysis of the direction and magnitude of return spillovers can be used to discriminate the transmission mechanism of information between the regional and the national housing markets over different areas and different time spans empirical findings indicate that the difference in housing prices between the northern and southern regions of the uk will increase each time a new financial crisis occurs

finding default understanding the drivers of default on contracts with farmers organizations under the world food programme purchase for progress pilot during the past two decades food assistance policy has shifted toward local or regional food purchases and away from purchases from donor countries while most local and regional procurement occurs through hard tendering processes open to large scale firms and farms there is growing interest in identifying how and whether to procure from smallholder farmer organizations to date little is known about the drivers of successful contracting with farmers organizations fos we utilize data from the united nations world food programme purchase for progress pilot in three east african countries to predict defaults on contracts we examine four possible explanations country contexts fo characteristics prior experience with contracts and contract modalities and their relationship to local spot market prices the single most important predictor of default is the increase in market prices between contract approval and delivery yet while increases in market prices are linked to increases in default this relationship is decreasing in contract size indicating search costs associated with breaking contracts our findings yield both generalizable and context specific insights about whether and when procuring from smallholder farmers can be successfully integrated into the food assistance toolkit this article is protected by copyright all rights reserved

contract farming smallholders and rural development in latin america the organization of agroprocessing firms and the scale of outgrower production abstract this paper demonstrates how contract farming functions as an economic institution and explores the causes of the observed variation in the scale of outgrower production in latin america we outline how market imperfections and transaction costs influence the decision of agroprocessing firms to contract out vertically integrate or use spot markets to obtain raw product the paper demonstrates how market conditions are likely to be associated with particular outgrower characteristics under contract farming an analysis of the mexican frozen vegetable industry illustrates determinants of successful and unsuccessful small scale contracting and suggests alternative policies to promote contract farming with smallholders

peasant household behaviour with missing markets some paradoxes explained a model of peasant household behavior under varying degrees of household specific food and labor market failures is constructed to show that these structural features can explain several well known patterns of peasant response which have often been attributed to peculiar motives presumed specific to peasants the model explains sluggish response to cash crops prices and high instability in perceived food and labor scarcities the key role of manufactured consumer goods prices in stimulating peasants effort in cash crops production the effectiveness of taxation as opposed to incentives in stimulating cash crops production and the key role of technological change in food production to enhance cash crop production results are obtained analytically in the case of one market failure and by numerical simulation with more than one

regional housing price cycles a spatio temporal analysis using us state level data kuethe t h and pede v o regional housing price cycles a spatio temporal analysis using us state level data regional studies a study is presented of the effects of macroeconomic shocks on housing prices in the western united states using quarterly state level data from 1988 1 to 2007 4 the study contributes to the existing literature by explicitly incorporating locational spillovers through a spatial econometric adaptation of vector autoregression spvar the results suggest these spillovers may granger cause housing price movements in a large number of cases spvar provides additional insights through impulse response functions that demonstrate the effects of macroeconomic events in different neighbouring locations in addition it is demonstrated that including spatial information leads to significantly lower mean square forecast errors kuethe t h et pede v o la variation cyclique regionale du prix du logement une analyse geographico temporelle des donnees sur les etats aux e u regional s

governance and trade in fresh vegetables the impact of uk supermarkets on the african horticulture industry production of fresh vegetables for export has grown rapidly in a number of countries in sub saharan africa over the last decade this trade brings producers and exporters based in africa together with importers and retailers in europe large retailers in europe play a decisive role in structuring the production and processing of fresh vegetables exported from africa the requirements they specify for cost quality delivery product variety innovation food safety and quality systems help top determine what types of producers and processors are able to gain access to the fresh vegetables chain and the activities they must carry out the control over the fresh vegetables trade exercised by uk supermarkets has clear consequences for inclusion and exclusion of producers and exporters of differing types and for the long term prospects for the fresh vegetables industry in the two major exporting countries studied kenya and zimbabwe

transactions costs and agricultural household supply response we develop and estimate a model of supply response when transactions costs create a situation where some producers buy others sell and others do not participate in markets we present two rationales for why producing households may have different relationships to the market proportional and fixed transactions costs using data on mexican corn producers we estimate an empirical model that allows for separate tests of the significance of both types of transactions costs revealing that both fixed and proportional transactions costs matter for the estimation the results provide consistent estimates of supply elasticity and measures of the relative importance of factors determining both proportional and fixed transactions costs

why do small scale producers choose to produce under contract lessons from nontraditional vegetable exports from zimbabwe summary this article explores the motivations behind the decision of small scale producers to grow nontraditional vegetables under contract for export based on a survey of small scale producers in zimbabwe four factors are identified as motivating contracting namely market uncertainty indirect benefits e g knowledge acquisition income benefits and intangible benefits respondents are clustered according to the relative importance of these factors in their contracting decision four clusters are identified and related to the characteristics of these farmers including size of the farm amount of land devoted to export crops access to alternative markets and the proportion of family income derived from export crops the results suggest that there are systematic differences between farmers in their decisions to contract which needs to be recognized in contract design and management 2005 elsevier ltd all rights reserved

human resource management as a substitute for trade unions in british workplaces the authors use british workplace data for 1980 98 to examine whether increased human resource management hrm practices coincided with union decline consistent with the hypothesis that such practices act as a substitute for unionization two initial analyses show no important differences between union and non union sectors or between newer workplaces which are likelier to be non union and older ones in the pattern of hrm practices over time and the study s longitudinal analysis picks up no evidence of faster union decline in workplaces or industries that adopted hrm practices than in those that did not not only is the hypothesized substitution effect thus not supported but the authors even uncover some evidence of a complementarity between unions and hrm practices the authors conclude that increased use of hrm practices is probably not an important factor underpinning union decline in britain

cash cropping and food crop productivity synergies or trade offs the case for promoting export oriented cash crops in africa has generally been based on their direct potential contribution to agricultural productivity and small farmer incomes a relatively neglected avenue of research concerns the synergistic effects that cash cropping can have on other household activities including food production the conventional view that cash crops compete with food crops for land and labour neglects the potential for cash crop schemes to make available inputs on credit management training and other resources that can contribute to food crop productivity which might otherwise not be accessible to farmers if they did not participate in cash crop programs this article builds on previous research by hypothesising key pathways by which cash crops may affect food crop activities and empirically measuring these effects using the case of cotton in gokwe north district in zimbabwe analysis is based on instrumental variable analysis of survey data on 430 rural households in 1996 results indicate that after controlling for household assets education and locational differences households engaging intensively in cotton production obtain higher grain yields than non cotton and marginal cotton producers we also find evidence of regional spill over effects whereby commercialisation schemes induce second round investments in a particular area that provide benefits to all farmers in that region regardless of whether they engage in that commercialisation scheme the study suggests that the potential spill over benefits for food crops through participation in cash crop programs are important to consider in the development of strategies designed to intensify african food crop production

the social performance and distributional consequences of contract farming an equilibrium analysis of the arachide de bouche program in senegal abstract this paper is an empirical analysis of the impact of a contract farming program in senegal we examine the access of poorer community members to contracts and the effect of the program on the income of participants the program performs very well on both counts participants and nonparticipants are indistinguishable by wealth measures and farmers increase their income substantially by participating in the program we attribute the former to the program s mobilization of local information through its use of village intermediaries permitting the substitution of social collateral for physical collateral and making the program more accessible to the poor

farmer organization collective action and market access in meso america abstract farmer organization and collective action are often seen as key factors in enhancing farmers access to markets often too little attention is directed at a the most appropriate types of organization b whether organization makes less or more sense in the case of producers of an undifferentiated commodity or a higher value product c whether the public or private sector is best placed to support farmer organizations and d the conditions necessary for ensuring their economic viability research in mexico and central america explored these issues for commodity maize and high value vegetables respectively the benefits of farmer organization are more evident in the vegetable sector characterized by high transaction costs associated with market access however horticultural farmer organizations in honduras and el salvador include less than 5 of total horticultural producers this is possibly due to farmer organizations limited business skills and non replicable organizational models there is less incentive for maize farmers to organize to access output markets as the transaction costs are relatively low the benefits of maize farmer organization are clearer when it comes to accessing inputs such as credit seed and fertilizer farmer organization is a critical factor in making markets work for the poor but the role and timing of public and private investment in these organizations is poorly understood

supply chain differentiation contract agriculture and farmers marketing preferences the case of sweet pepper in thailand there is an emerging body of literature analyzing how smallholder farmers in developing countries can be linked to modern supply chains however most of the available studies concentrate on farm and farmer characteristics failing to capture details of institutional arrangements between farmers and traders moreover farmers preferences have rarely been considered here we address these gaps by analyzing different market channels for sweet pepper in thailand using data from a survey and choice experiment with farmers we find that there is a general preference for marketing options that do not involve a contract additional provision of inputs and credit can increase the attractiveness of contracts yet the most important factor for farmers is to personally know the buyer they deal with which may be related to issues of trust some policy implications are discussed

private enforcement capital and contract enforcement in transition economies the enforcement of contracts is necessary for efficient exchange and investment in economic activities there are many situations where public institutions are ineffective in enforcing contracts this is the case in economies in transition where public enforcement institutions themselves are being reformed under such conditions private mechanisms could enforce contracts external private enforcement is done by third parties e g strong arm private agents although such enforcement may be effective it may have unwanted externalities alternatively internal private enforcement can be done through the use of so called private enforcement capital i e private losses that result from breaching the contract these losses result directly from contract termination or non renewal and indirectly from reputational damage by designing contracts such that these private losses from contract breach outweigh potential benefits contracts can be made self enforcing in this article we first present a conceptual framework to interpret contracts and to analyze how the use of private enforcement capital can enforce contracts then we illustrate such internal private contract enforcement mechanisms with several case study examples of agri business contracting in transition countries where public enforcement fails

contracting out solutions political economy of contract farming in the indian punjab abstract this paper examines the rationale practice and problems of contract farming in vegetable crops in the agriculturally developed indian punjab which has faced the problem of sustainability of growth since the early 1980s it is found that agribusiness firms deal with relatively large producers and their contracts which are biased against the farmer perpetuate the existing problems of the farm sector such as high chemical input intensity and social differentiation contracting has however led to higher farm incomes and more employment for labor there seems to be an inherent contradiction in the objectives of the contracting parties and those of the local economy

unions work practices and wages under different institutional environments the case of canada and england using data collected in 2003 2004 in national telephone surveys of 750 canadian and 450 english workers the author finds that alternative work practices awps such as autonomous teams quality c

testing for convergence between uk regional house prices drake l 1995 testing for convergence between uk regional house prices reg studies 29 357 366 this paper uses the kalman filter time varying parameter estimation technique to test for convergence between uk regional house prices this issue is significant given the historical disparities in regional house price inflation rates and the unprecedented downturn in both uk and most regional house prices in the late 1980s and early 1990s the evidence suggests that there are clear regional differences in the pattern of uk house price movements in particular house prices in the north and scotland show evidence of greater divergence from prices in the rest of the south east region than do the southern and midlands regions drake l 1995 une analyse pour determiner la convergence des prix du marche immobilier regionaux au royaume uni reg studies 29 357 366 cet article se sert de la technique dite kalman filter afin de determiner la convergence des prix du marche immobilier regionaux au royaume uni c

impact of third party contract enforcement in agricultural markets a field experiment in vietnam we study the effect of alleviating the information asymmetry regarding product quality that is widespread in contracts between agricultural producers and buyers in developing countries opportunistic buyers may underreport quality levels to farmers to reduce the price that they have to pay in response farmers may curb investment thereby negatively affecting farm productivity in an experiment we entitle randomly selected smallholder dairy farmers in vietnam who are contracted by a large company to independently verify milk testing results results indicate that treatment farmers use 12 more inputs and they also increase their output significantly some wider research and policy implications are discussed

input control in agricultural production contracts tion problems there will be distortionary effects on industry output and returns from production will be distributed in a predictable way regardless of the underlying motivation for contract design the resulting distribution of returns and risks is likely to differ from the traditional spot market distribution understanding the incentives underlying the design of agricultural production contracts will aid in predicting their influence on the distribution of returns as their usage increases in addition to its practical importance the economic analysis of agricultural production contracts provides an opportunity to test contract theory empirically over the past twenty years contract theory or mechanism design has burgeoned as an area of theoretical analysis this growth in the theory has not been matched by an accompanying empirical literature there has been only a limited amount of empirical work in these areas primarily on auctions as well as executive compensation and franchising cf laffont ossard and vuong jensen and murphy and lafontaine agricultural production contracts provide an opportunity to test whether asymmetric information models have explanatory value i consider whether such models are sometimes observationally equivalent to other economic models and what research techniques will aid in distinguishing among explanations i address these issues in the context of a