a dual definition for the factor content of trade and its effect on factor rewards in us manufacturing sector we introduce a dual definition of the factor content of trade fct using the concept of the equivalent autarky equilibrium estimating a symmetric normalized quadratic revenue function for the u s manufacturing sector between 1965 and 1991 we find that the fct for capital is positive while the fct for skilled and unskilled labor is negative suggesting that the leontief paradox is not present then the growth rate of the factor rewards is decomposed to the fct endowments and technological change effects we find that technological change is the most important determinant in explaining wage inequality between skilled and unskilled labor

planning under incomplete information and the ratchet effect abstract central planning of production is usually performed under asymmetric information the firm in general has more information about its productive possibilities than the central planner from now on for short cp this justifies the use of incentives schemes in which the cp does not directly fix activity levels casual observation of such existing schemes suggests that the time dimensions is crucial for their working typically the cp revises the incentive scheme over time to take into account the information provided by the firm s performance managers of centrally planned economies as well as economists have long recognized that this revision induces firms to underproduce in order to avoid demanding schemes in the future this is the ratchet effect it is purpose of the present paper to study the ratchet effect under the non commitment assumption which we believe to be more realistic the inadequacy of conceptual tools made if difficult in the past to consider such an assumption now basic research on dynamic games with incomplete information recently resulted in new ideas which look particularly relevant for a theoretical analysis of the problem

dynamic limit pricing i study a multiperiod model of limit pricing under one sided incomplete information i characterize pooling and separating equilibria and their existence and determine when these involve limit pricing for some parameter constellations the unique equilibrium surviving a d1 type refinement involves immediate separation on monopoly prices for others there are limit price equilibria surviving the refinement in which different types may initially pool and then possibly separate separation involves setting prices such that the inefficient incumbent s profits from mimicking are negative as the horizon increases or as firms become more patient limit pricing becomes increasingly difficult to sustain in equilibrium

a cost function analysis of import demand for nigeria the article uses a translog cost function to examine the substitution relations among capital labour and imports the results show that capital has a substitute relation with domestic labour and import however labour and import have complementary relationship the implication of this finding is that liberalization policies if pursued vigorously could impart positively on the demand for labour in addition it suggests that economic growth could be enhanced through trade liberalization

a rational expectations model of agricultural supply this work suggests a dynamic linear rational expectations modeling strategy for using time series observations to study the impact of product prices on agricultural production and land allocation the farmer s decision consists of specifying each period the portion of his land to be devoted to the growing of alternative crops the dynamic element in the farmer s problem comes from the technology a quadratic production technology is used the farmer s optimal land allocation decision rules are derived as linear functions of past land allocations expectations of future product prices and other exogenous variables and they can be interpreted as an optimal crop rotation assuming rational expectations and the exogeneity of prices for a small open economy one obtains closed form linear regression equations representing decision rules and stochastic processes these are then estimated and tested using maximum likelihood methods and aggregate data from the egyptian agriculture

agricultural product supplies and input demands regional comparisons governmental agencies at federal state and local levels in the united states are heavily involved in intervention in agricultural input and output markets to effect desired social goals the most pervasive intervention activities occur at the federal level they are available throughout the nation to most producers of specified commodities how

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

monetary policy with uncertain central bank preferences this paper considers monetary policy when policy makers preferences are private information i show that in the first period of a two period term all policy makers but the least inflation averse inflate less but respond more to shocks than if there were no private information moderately inflation averse policy makers may reduce their inflation most a tendency toward increased conservatism in their second period increases inflation in the first with t period terms inflation depends solely on the policy maker s time left in office with unchanging preferences and no discounting inflation is lower the longer he has left

normal inputs and joint production with allocatable fixed factors when jointness is caused by allocatable fixed factors in the normal case the marginal cost of any output increases as any other output increases the supply of any output decreases as any other output price increases and an input price increase may cause the supply of some outputs to increase

a model of production with supply management for the canadian agricultural sector the production structure of the canadian agricultural sector is modeled by an output constrained multiproduct profit function to account for the existence of supply management policies the le chatelier effects of supply constraints are illustrated and the comparative statics of supply management is shown to depend under input normality on the type of jointness convexity is tested and accepted and nonjointness is rejected by the estimated normalized quadratic profit function the results support the hypothesis of nonjointness due to allocatable fixed factors decreasing the supply of managed commodities will increase the supply of unrestricted commodities while total input use is reduced

the theory and measurement of producer response under quotas tobin and houthakker s work on consumer behavior under quantity rationing has been extended by many authors especial ly through the use of duality theory this paper uses duality theory to extend the work on demand theory under rationing to the case of producer behavior under quotas these results permit estimation of otherwise unobservable market supply and demand structures the structure of the farm economy operating under a tobacco quota system is estimated and the theory is utilized to infer that the supply elasticity of tobacco would be about 7 0 if the quotas were removed estimates such as this are not normally attainable without the theor y outlined here even though they are essential for the evaluation of policy changes copyright 1993 by mit press

reputation and imperfect information abstract a common observation in the informal literature of economics and elsewhere is that is multistage games players may seek early in the game to acquire a reputation for being tough or benevolent or something else but this phenomenon is not observed in some formal game theoretic analyses of finite games such as selten s finitely repeated chain store game or in the finitely repeated prisoners dilemma we reexamine selten s model adding to it a small amount of imperfect or incomplete information about players payoffs and we find that this addition is sufficient to give rise to the reputation effect that one intuitively expects

allocable fixed inputs as a cause of joint production an empirical investigation leathers 1991 shows that while the existence of allocable fixed inputs can cause joint production as in shumway pope and nash 1984 it will not necessarily lead to joint production the extent to which allocable fixed inputs cause joint production in agriculture is an empirical question this paper offers an empirical answer by estimating a short run joint cost function it is possible to identify levels of outputs for which joint production may be optimal in the short run but not in the long run only in these output regions will there be jointness caused by allocable fixed inputs for the data in this paper 160 wisconsin farms these output regions are very small thus allocable fixed inputs do not appear to be an important cause of jointness for these farms technical causes of jointness appear to be a significant cause of joint production

estimating ex ante cost functions for stochastic technologies this paper revisits the problem of estimating ex ante cost functions previously studied by pope and just in 1996 as well as moschini in 2001 an ex ante cost function that generalizes their ex ante cost functions is introduced and an econometric procedure for estimating a flexible approximation to it is developed that generalized cost function is economically relevant not only for the pope and just 1996 choice setting but for general producer risk preferences general stochastic technologies and general forms of price uncertainty an econometric strategy for estimating the resulting cost structure that adapts moschini s 2001 full information approach is developed followed by an econometric application to u s agriculture

competitiveness of regions from an evolutionary perspective boschma r a 2004 competitiveness of regions from an evolutionary perspective regional studies38 993 1006 do regions compete as firms do how does one deal with the fact that regions unlike organizations are entities that do not act does it make sense to talk about the ability of regions to generate new variety this paper aims to address these questions from an evolutionary perspective it is meaningful to talk about regional competitiveness when the region affects the performances of local firms to a considerable degree this is especially true when the competitiveness of a region depends on intangible non tradable assets based on a knowledge and competence base embedded in a particular institutional setting that are reproduced and modified through the actions and repeated interactions of actors although regions are increasingly becoming collective players actively responding to an increasing exposure to extra regional competition the paper explains why there are serious limits in enhancin

information overload navigation and the geography of mediated markets this article integrates arguments from the perspectives of the economics of information and of the economy of qualities to analyze the spatial consequences of digital technology and information overload on two exemplary product markets quality wine and stock photography it demonstrates how digital technology enhances information overload in product markets and how the geography of market relations is transformed along new intermediaries and new practices of navigation that account for two different geographical paradoxes

modeling supply response in a multiproduct framework the paper models multiproduct supply response in agriculture and tests key assumptions traditionally maintained in supply response studies the technology is approximated by a restricted profit function the properties of the restricted profit function are imposed during estimation the hypothesis that maintains the existence of output price and quantity indexes that satisfy the adding up property is rejected the existence of individual production functions for each output is also rejected unless joint production is permitted the estimates of responsiveness of a particular commodity to changes in own price or prices of competing outputs are likely to be considerably understated

comparative statics of the optimal dynamic incentive contract abstract each period a firm must carry out an indivisible project the cost of which depends on the firm s constant efficiency and its variable level of effort only the cost is observed by the regulator who has to choose the incentive scheme the optimal dynamic mechanism is derived under possible commitment of the regulator over time then under non commitment it is shown that there are four types of continuation equilibria also the profile of effort levels is compared to the commitment case finally some numerical comparative statics is performed and it is shown that all types of equilibria can be optimal

dynamic factor demand equations in u s and canadian agriculture abstract this research provides one of the first empirical estimates of a data based dynamic factor demand model for american and canadian agriculture models such as these deserve more widespread use in the empirical analysis of agriculture these models have the advantage that they do not impose inappropriate dynamics on the data rather they permit the data to select the appropriate dynamics we use a model originally developed by anderson and blundell this model is a general first order dynamic model which contains as testable hypothesis several simpler models this model permits us to estimate the long run agricultural production structure as a subset of the dynamic parameter estimates we will test this long run structure for symmetry homotheticity and neutral technical change the estimated models may be used to test for three alternative dynamic structures in the limit dynamics may not be needed and we can test for the static long run equilibrium model two intermediate cases are the autoregressive and the partial adjustment models which are simpler than the general model but still include dynamics our results suggest that the long run equilibrium model is unsatisfactory in both countries a dynamic model is needed in both countries the two more restricted dynamic models are rejected the general dynamic model is required in canada the long run equilibrium structure is homothetic with neutral technical change in the united states homotheticity is also accepted but neutral technical change is rejected

dynamic model of fresh fruit promotion a household production approach many studies consider the dynamic effects of commodity promotion on demand but few derive the theoretical basis for these effects in a model of optimal consumer behavior this study develops a dynamic household production model of u s fresh fruit consumption which it uses to evaluate the effectiveness of advertising and promotion expenditures by the washington apple commission estimates from a dynamic dual generalized leontief system show direct advertising to be marginally more effective than retail promotion in increasing apple sales but advertising has positive spillover effects to sales of other fruits whereas promotion reduces sales of competing products

output supply and input demand system of commercial and backyard poultry producers in indonesia indonesia s domestic broiler production has grown rapidly in part because of a ban on imports of poultry parts and strict inspection and meat certification requirements whether indonesia will continue to protect the domestic broiler sector and import feed grains and other inputs or whether it will directly import meat products is a relevant question to many stakeholders this study uses a normalized quadratic function to estimate the output supply of commercial and backyard broiler producers in indonesia and the input demand for three major inputs day old chicks feed and labor data come from three datasets a 1996 household survey and 1996 and 2000 surveys of commercial producers for the most recent dataset the own price elasticity in both the output supply and feed input demand equations were found to be significant the signs of the elasticities were theoretically consistent with a positive supply and negative demand elasticity the magnitudes of the elasticities were smaller than expected the supply elasticity was 0 285 the inelastic supply explains the high border protection imposed by indonesia which in turn implies that any income driven expansion in the quantity of broiler product demanded would be quickly constrained by rising prices consequently supply from imports would become attractive and would dampen any incentive for growth in the domestic sector this result cast doubt on the long term sustainability of indonesia s import substitution policy regime

conventions and innovation a comparison of two localized natural resource based industries lindkvist k b and sanchez j l conventions and innovation a comparison of two localized natural resource based industries regional studies the paper explores the development of new conventions in two natural resource based industries the norwegian salt fish industry and the wine industry in the spanish region of castilla y leon modest innovation in the former industry tied to domestic and industrial conventions is contrasted with the success of the latter wine producers have adopted the protected designation of origin pdo system to satisfy the market s demand for quality whereas norwegian salt fish producers are reluctant to cooperate with non local institutions external influences in the wine industry have provided market intelligence and scientific knowledge to winegrowers and wineries lindkvist k b et sanchez j l conventions et innovations une comparaison entre deux industries exploitant des resources locales regional studies cet article explorera le developpement de nouvelles conv

production quota in multiproduct pacific fisheries abstract assessing the individual firm s technology and costs in a multispecies fishery allows design of a more effective output quota prior to regulation by anticipating and controlling for the firm s regulation induced responses an empirical study of a pacific coast trawl fishery indicates that the firm s flexibility of product decision is tightly constrained by its technology and cost structure hence as the resource stock for the regulated species sablefish deteriorates and the trip quota progressively tightens the firm cannot sufficiently reorganize its product bundle to preclude increasingly large sablefish disposal this defeats the purpose of the production quota

technology and efficiency in a panel of italian dairy farms an sgm restricted cost function approach this article employs a short term specification of the symmetric generalised mcfadden sgm cost function capable of accommodating quasi fixed factors and variable returns temporary equilibrium and scale economies are investigated while maintaining the consistency of the estimated model with microeconomic theory and approximation properties it also makes use of a two step procedure to estimate first the technology parameters and then time varying efficiency at farm level no distributional assumptions are required on efficiency as we consider a fixed effect model a balanced panel of italian dairy farms during the years from 1980 to 1992 serves as the case study the results suggest a rigid productive structure during the pre and post quota period moreover italian milk producers are found to exhibit considerable excess capacity and rather low input technical efficiency

flexible specification of mixed demand systems common flexible functional forms are not very useful for modeling mixed demand systems because derivation of mixed demands requires closed forms for both direct and indirect utility functions in this paper we study the alternative of using a direct approximation to mixed demands we develop a new approach to slutsky relations for mixed demand functions allowing formulation of a rotterdam mixed demand model the resulting mixed demand system is illustrated with an application to meat demand in canada

the demand for imports in korea a production analysis approach abstract balance of trade problems in the united states and other highly industrialized countries have resulted in cries for korea to liberalize its import policies this paper uses a translog cost function to investigate korea s demand for imports and the effects of trade liberalization on the demand for the country s domestic inputs this study suggest that the domestic inputs and imports are substitutes and that as the proportion of investment goods in korea s gdp increases the demand for imports will also increase thus further liberalization of korea s import policies could present short run problems in the domestic input markets

formulas and flexibility in trade negotiations sensitive agricultural products in the world trade organization s doha agenda many trade negotiations involve large cuts in high tariffs while allowing smaller cuts for an agreed share of politically sensitive products the effects of these flexibilities on market access opportunities are difficult to predict creating particular problems for developing countries in assessing whether to support a proposed trade agreement some widely used ad hoc approaches for identifying likely sensitive products such as the highest bound tariff rule suggest that the impact of a limited number of such exceptions on average tariffs and market access is likely to be minor applying a rigorous specification based on the apparent objectives of policymakers in setting the prenegotiation tariff enables more accurate assessment of the implications of sensitive product provisions for average agricultural tariffs economic welfare and market access under the doha negotiations the analysis concludes that highest tariff rules are likely to seriously underestimate the impacts on average tariffs and that treating even two percent of tariff lines as sensitive is likely to have a sharply adverse impact on economic welfare the impacts on market access are also adverse but much smaller perhaps reflecting the mercantilist focus of the negotiating process

analysis of hospital production an output index approach in this study a new model of hospital costs is developed and estimated utilizing an output index this theoretically appropriate output index is constructed to accurately reflect the differentiated nature of hospital care by employing both patient and diagnosis characteristics in its construction using this output index we estimate a long run translog cost function with a dataset of 321 california hospitals for the year 2003 we find evidence of economies of scope across specialties within primary care and evidence of scope diseconomies within secondary and tertiary care point estimates of scale economies using the output index indicate that minimum efficient scale is reached at a larger level than when using less refined output measurement techniques that have often been used in similar studies our estimates indicate the importance of accounting for specialty specific scope economies when analyzing the production properties of firms producing differentiated products

dynamic bargaining with action dependent valuations abstract an infinite horizon dynamic bargaining model is presented in which actions affect the expected future value of the buyer seller match because actions directly affect the future surplus to be bargained over the model is unlike other models that tie the dynamic process to nature alone focusing on a subset of weak markov equilibria several results come about that are not found in static bargaining models using similar bargaining protocols in particular optimal price demands can be lower higher than the buyer s lowest highest possible valuation and several empirical features concerning wage settlements and strike incidence from labor union contract negotiations can be explained

contract renegotiation and coasian dynamics consider a long term relationship between a seller and a buyer whose valuation for a per period service or a durable good is private as trade progresses the valuation will be partially revealed and it may be impossible for the parties to commit ex ante not to take advantage of this we analyse this situation first by supposing that the parties can sign a sequence of short term contracts and secondly by supposing that they can sign a long term contract but cannot commit not to renegotiate it later we find a close relationship in the second case between the optimal long term contract and the non commitment outcome in the standard coasian durable good model our results also have implications for hidden information principal agent models

repeated bargaining with persistent private information the paper analyses repeated contract negotiations involving the same buyer and seller where the contracts are linked because the buyer has persistent but not fully permanent private information the size of the surplus being divided is specified as a two state markov chain with transitions that are synchronized with contract negotiation dates equilibrium involves information cycles triggered by the success or failure of aggressive demands made by the seller because there is persistence in the markov chain generating the surplus a successful demand induces the seller to make another aggressive demand in the next negotiation since the buyer s acceptance reveals that the current surplus is large rejection of an aggressive demand on the other hand leads the seller to be pessimistic about the size of the surplus in the next contract so the seller makes a soft offer that is sure to be accepted then after several such offers have been accepted the seller is optimistic enough to again make an aggressive demand creating an information cycle an interesting feature of this cycle is that the soft price is not constant but declines as the cycle continues so as to offset the buyer s option value of re starting the cycle when the current state is bad an explicit mapping is given for the relationship between the basic parameters and the equilibrium prices and quantities in particular there is a closed form solution for the threshold belief that makes the seller indifferent between hard and soft offers

mexican agricultural trade under the gatt expected effects from partially lifting tariff barriers on the mexican agricultural sector are investigated using a restricted profit function rpf approach short run and intermediate run effects of the implementation of gatt minimum tariff provisions on mexican agricultural trade are examined specification tests reveal the appropriateness of the rpf approach that exports should not be aggregated with non traded production into a single output and that the farm sector behaves as an almost price taking profit maximizing firm policy simulations suggest important short run changes in agricultural trade and chemical use and intermediate run changes in agricultural trade labour wage chemical use capital investments and net farm income

is transparency about central bank plans desirable a central bank with private information about its preferences has an incentive to reduce its planned inflation to increase the public s perception of its inflation aversion and lower expected future inflation a regime is said to be transparent if planned inflation is observable and reveals the central bank s preferences and to be non transparent if planned inflation is unobservable and can be only imperfectly inferred from actual inflation a central bank in the non transparent regime is said to become more transparent when actual inflation becomes a better signal of planned inflation i find several results about transparent and non transparent regimes some are novel and some contrast with the results of earlier papers in particular i demonstrate that in a non transparent regime increased transparency need not improve the public s ability to infer a central bank s private information i show that society and central banks are better off with more transparency my numerical results suggest that society and central banks prefer the transparent to the non transparent regimes

the four worlds of contemporary industry the authors propose to endogenize industrial diversity by beginning with the product defined in terms of its qualities for the user specialized standardized dedicated generic for each type of product there is a coherent possible combination of product dualities production technologies and markets these coherent combinations can only come about when coherent mutual expectations conventions are formed between actors in the production system in terms of resource qualities quantities and their economic equivalents the theoretical problem of diversity is redefined as one of collective action the coherence of conventions of groups of actors helps explain what they do in market economies and how they do it copyright 1992 by oxford university press

a model of production with supply management for the canadian agricultural sector comment in a recent paper moschini 1988 claims to prove that cost complementarities between outputs do not exist when outputs are joint because of fixed allocatable factors which are normal inputs this comment demonstrates that moschini s proposition is incorrect shows where the proof of the proposition is faulty and identifies the additional condition that must hold in order for moschini s proposition to be true correct derivation of this proposition is important because technology with fixed allocatable factors and multiple outputs is common in agriculture and standard analyses of multiple output cost functions such as sakai s or lau s do not apply directly to this technology consider the multiple output cost function used in moschini 1988 to characterize production which is joint in outputs because of constraints on allocatable fixed factors jointness is not present in the primal representation of this technology the production possibility set can be represented with individual production functions for each output but outputs are joint in the dual cost and profit functions because they must compete for a constrained quantity of some allocatable input the joint cost function is defined by moschini s equation 15 which is reproduced here as equation 1

production economics worthwhile investment abstract agricultural production economics research is examined within a broad framework of scientific development and utilization recent findings in selected areas of the subdiscipline are examined and opportunities for further fruitful inquiry are identified a few stylized facts emerge from recent work and suggest the need for much careful hypothesis testing model exploration and empirical sensitivity analysis in the future

numeraire choice in agricultural supply analysis should the choice of numeraire price for modelling profit functions be arbitrary or is more careful study needed here the choice of numeraire is examined using tests for models specification and out of sample predictive accuracy based on the crop and livestock data obtained from iowa the results of this study indicate that for this data set and functional form it does indeed make a difference which numeraire you choose this is in contrast to previous studies which in general indicated that the choice of numeraire equation is arbitrary or more commonly offered no justification for the netput chosen

the effect of supply management on herd size in alberta dairy a supply management program limits the aggregate supply of a commodity often through the use of marketable quota licenses the static aggregate welfare effects of supply controls are well known but the farm level dynamic effects on dairy investment are not a theoretical cost of adjustment model is used to show that supply management reduces the rate of quasi fixed input adjustment at the farm level in fact when a quasi fixed input is complementary to quota licenses investment or disinvestment can be impaired to such an extent that the input moves away from the long run equilibrium as a result overinvestment in this input can significantly reduce productivity growth

modeling farm households price responses in the presence of transaction costs and heterogeneity in labor markets we develop a farm household model to analyze price responses of farm households this model incorporates various types of transaction costs as well as labor heterogeneity nonproportional variable transaction costs or labor heterogeneity imply that production and consumption decisions become nonseparable even when the household buys or sells labor an empirical model is estimated using data from midwest poland the results show that nonproportional variable transaction costs and labor heterogeneity significantly influence household behavior not all price elasticities however change significantly if these are neglected

signalling and renegotiation in contractual relationships this paper examines how the possibility of renegotiation affects contractual outcomes in signaling games when an infinite number of rounds of renegotiations are allowed before contracts are executed the main results of the paper are 1 contracts may still contain distortions 2 the popular efficient separating equilibrium outcome is never an equilibrium outcome with renegotiation 3 incentive compatibility constraints can be generalized to incorporate renegotiation 4 equilibrium outcomes can be separating and nevertheless depend on the uninformed player s prior and 5 renegotiation in signaling games may lead to outcomes similar to equilibrium outcomes of screening games in which multiple contract purchases are allowed copyright 1993 by the econometric society

numeraire choice in normalized quadratic functional forms a semi nested test procedure is developed for choosing the numeraire for a normalized quadratic profit function when too few observations exist for nested hypothesis testing and when too many alternatives exis for conventional non nested testing sensitivity of empirical results to choice of numeraire price is examined using agricultural data for the us and ten multistate regions few test conclusions vary by numeraire but own price input demand elasticities differ greatly

asymmetric adjustment of dynamic factors at the firm level presents a study which addressed the deficiencies of previous studies the specification and estimation in the modeling of asymmetry and zero gross investment in the agricultural industry reference to previous studies on asymmetry information on the standard dual model results of the study

multiproduct supply and input demand in u s agriculture two sets of u s agricultural output supply and input demand relationships including cross price effects are reported for five commodity groups and four variable input groups for the 1951 82 period they are obtained by direct econometric estimation on u s data and by geographic aggregation from published econometric estimates for each of ten regions comprising the contiguous forty eight states the supply and demand formulations are specified on the assumptions of competitive behavior and an underlying normalized quadratic profit function the effects of upward sloping input supply curves are examined at the national level

effects of subsidies in russian dairy farming this study develops a microeconometric model of specialized dairy farms in the moscow region using panel data over the period 1995 2001 the model is used to analyze the role of subsidies on profit as well as input and output allocation theoretical conditions for short term profit maximization are not rejected by the data differences between farms allow for a fixed effect specification the dairy producers in the region demonstrate a low responsiveness to market signals but technology change becomes important labor land and livestock had low shadow prices although subsidies have a distorting effect on the input output mix this study shows they relieve the credit constraints on dairy farms and have an important positive influence on farm profit

supply response of u k milk producers short run own price response elasticities are estimated from two samples of panel data for specialist dairy farms in the northwest and southwest of england although these farms are subject to milk marketing quotas the free tradability of quotas enables them individually to adjust the output quite rapidly model specifications have been chosen to test the ability of panel data to directly reveal behavioral responses without the imposition of theoretical restrictions significantly the two independent samples generate quite similar results especially in terms of supply response measures stable and promising estimates are obtained with simultaneous models giving higher elasticities than single equation models

the environment as a factor of production the authors develop a model of environmental resource use in production with an empirical analysis of how electric power companies consume and bank sulfur dioxide pollution permits the model considers emissions fuels and labor as variable inputs with quasi fixed inputs of permits and capital incorporating information from permit markets allows the authors to distinguish between user costs and asset shadow values their findings indicate that firms are holding stocks of pollution permits for reasons other than short term cost savings the results also reveal substantial substitution possibilities between emissions permits stocks and other factors of production the authors speculate that anticipated secondary markets for carbon offset inventories related to the flexibility mechanisms of the kyoto protocol will have similar effects for greenhouse gas emitting firms

a symmetric normalized quadratic gnp function and the u s demand for imports and supply of exports this paper reports estimates of a gnp function for the united states using data covering most of the postwar period and it introduces a new functional form the symmetric normalized quadratic variable profit function which is a natural extension of recent work by diewert and wales this functional form allows convexity in prices and concavity in fixed inputs to be imposed globally empirical results indicate that the demand for imports is less price elastic than the supply exports that an increase in labor endowment favors trade and that a deterioration of the terms of trade mostly hurts labor

measuring technical efficiency in the presence of pesticide spillovers and production uncertainty the case of dutch arable farms pesticides dynamic effects and production uncertainty play an important role in farmers production decisions pesticides have a current production impact through reducing crop damage in the current period and a future impact through impacting the farm biodiversity which alters the future production environment this study presents the difference in inefficiency arising from models that ignore the dynamic effects of pesticides in production decisions and the impact of production uncertainty a dynamic data envelopment analysis dea model is applied to outputs inputs and undesirables of dutch arable farms over the period 2003 2007 a bootstrap approach is used to explain farmers performance providing empirical representations of the impact of stochastic elements on production these empirical representations are used to adjust firms inefficiency scores to incorporate production uncertainty in efficiency evaluation we find that efficiency increased dramatically when a production technology representation that considers both pesticides dynamic impacts and production uncertainty is adopted

economic rents under supply controls with marketable quota we analyze the distribution of economic rent between owners and renters of marketable production quotas and examine how this distribution changes with increases in marginal costs while quota owners unambiguously lose because of a marginal cost increase quota renters may gain depending on whether the marginal cost shift is divergent parallel or convergent using output and input prices county production quotas and quota rental rate data we estimate a marginal cost function for north carolina flue cured tobacco to demonstrate how wage increases affect owners and renters welfare

repeated signalling games and dynamic trading relationships a seller of a nondurable good repeatedly faces a buyer who is privately informed about the position of his demand curve the seller offers a price in each period the buyer chooses a quantity given the price the quantity demanded reveals information about the buyer an equilibrium is characterized with the feature that buyer types separate completely in the first period this equilibrium uniquely satisfies a modified refinement of the cho kreps criterion despite the immediate separation the buyer distorts his behavior throughout the game the requirement to signal types can raise the utility of all types of informed players copyright 1998 by economics department of the university of pennsylvania and the osaka university institute of social and economic research association

the impact of decoupled payments on farm choices conceptual and methodological challenges abstract in this paper we review the methodological framework for analysing decoupled payments in models of agricultural production market and technological uncertainty farm efficiency credit constraints farm household choices involving extra agricultural decisions policy uncertainty and long run impact of decoupling on investment and land values are the relevant issues that should be pursued by methodological and empirical analysis future research should refine the analysis of decoupled payments mainly trying to provide results that can be useful for policy simulation to bridge the gap between analysis at the individual level and sector policy models

expenditure constraints and profit maximization in u s agriculture the u s agricultural sector is undergoing some of its most severe financial problems since the great depression numerous reports have emerged of large numbers of farmers being unable to obtain short term oper

a cost function analysis of import demand and growth in south africa abstract this study investigates the substitutability relationships among capital labor and imported inputs for south africa utilizing the estimates obtained from an aggregate cost function our results are consistent with the hypothesis that capital is a substitute for both domestic labor and imports but that labor and imports are complementary inputs this latter result suggests that relaxing south african trade restrictions may have a positive impact in both the long and the short run on the demand for domestic labor other results suggest that the reduction of market impediments may also positively impact the production of investment goods and economic growth