bluuebunny/crossref_metadata_2025 huggingface dataset:
QUARTERLY ESTIMATES OF THE DEMAND AND PRICE STRUCTURE FOR MEAT IN NEW SOUTH WALES
Authors: Marceau Ian W.
Published: April 2012

Multiple regression estimates of demand and price relationships for fresh beef, lamb and mutton in the N.S.W. livestock auction, wholesale, and retail markets during the period from January 1951 to June 1963 are presented. The results show that direct price elasticities of demand were negative, and of greatest absolute value in the retail market. Mutton is shown to have been a close substitute for beef and lamb, but the latter were not close substitutes with respect to price.
RISK, UTILITY AND THE PALATABILTY OF EXTENSION ADVICE TO FARMER GROUPS
Authors: Officer R.R. , Halter A.N. , Dillon John L.
Published: April 2012

Using the results of an empirical study of farmers' utility functions, evidence is presented that risk plays a measurable role in farmer decision making. The extension implications of such risk influences are discussed with particular emphasis on the possible efficacy of using group utility functions as a basis for group recommendations.
ON THE GROWTH OF THE AGRICULTURAL FIRM*
Authors: Jarrett Frank G.
Published: April 2012

Theoretical problems involved in the reconciliation of the assumption of constant returns to scale with determinacy of firm size are discussed with particular reference to Australian farms. Various techniques for examining changes in the size distribution of firms are examined and their use demonstrated. The work is stochastic rather than deterministic. B.A.E. sheep industry survey data is used and flock size is used as the measure of farm size. The results do not suggest that inequality in the distribution of farm sizes is increasing. Growth differs between flock sizes within the same region and for the same flock size between regions. Profitability seems to be relatively larger in the medium flock sizes.
THE CAPACITY OF THE N.S.W. PIG MARKET TO ABSORB POSSIBLE INCREASES IN NORTH COAST PIG PRODUCTION*
Authors: Hill Janet R.
Published: April 2012

Likely changes in gross income to farmers on the north coast of N.S.W. from an expansion of pig production are considered in the light of estimated demand conditions and the forecast future production of grain fed pigs in inland areas. Price elasticity of demand for pigmeat is estimated to be only slightly greater than unity; prospects for future expansion in inland areas are favourable given the strong direct relation found between pig production and wheat acreage and the low estimated elasticity of supply of 0.7; hence it is concluded expansion of milk‐fed pig production would do little to solve the farm problem on the north coast. Pig numbers in coastal areas are found to be mainly determined by pig prices and coastal production of butter in previous periods; elasticity of supply is estimated to be O.5. In the demand analysis the importance of the level of migration as a determinant of the demand for pork is highlighted.
WOOL POLICY IN THE UNITED STATES: ITS DIRECT IMPACT ON AUSTRALIAN EXPORTS
Authors: Houck James P.
Published: April 2012

Australian apparel wool exports to the United States are less than they might be because of two protective policies of the U.S. government: a fixed tariff and a system of direct price.support payments to U.S. wool producers. Dismantling these policies, though difficult, could mean $10 million to $21 million worth of additional Australian wool sales to the United States, over 1966 levels. Most of the increase would come from tariff cuts. Such amounts are worth negotiating for but would not solve the industry's problems.
SOME THOUGHTS ON THE ROLE OF THE AGRICULTURAL ECONOMICS PROFESSION IN AUSTRALIA*
Authors: Parish Ross M.
Published: April 2012

Does the seemingly disproportionate growth in Australia of agricultural economics, relative to other branches of applied economics, represent a misallocation of educational and research resources? Probably not, since (i) it may be better–because of the existence of increasing returns–to concentrate one's limited resources of economist brainpower in a few fields than to spread them widely; and (ii) the growth of agricultural economics has helped to correct certain weaknesses–particularly in micro‐economics and econometrics–in the Australian economics profession as a whole. However, it is suggested that in the future agricultural economists might apply their skills increasingly to non‐agricultural problems.
THE APPLICATION OF SIMULATION TECHNIQUES TO THE STUDY OF GRAZING SYSTEMS
Authors: Wright A. , Dent J.B.
Published: April 2012

Decision making studies in agriculture are often made difficult by the complex and dynamic nature of bio‐economic systems. Simulation is one of the newer systems research techniques which as yet has had limited use in farm management research. This paper discusses some methodological aspects of simulation with specific reference to grazing systems. Problems arising in the development and use of simulation models are discussed and the need for inter‐disciplinary co‐operation to overcome data problems is indicated. One approach to experimentation is illustrated by reference to a model of a sheep grazing system and the problem of cropping for winter grazing. It is concluded that simulation is a potentially useful technique for management‐oriented systems research in agriculture.
AN APPLICATION OF SPATIAL ANALYSIS TO BEEF SLAUGHTER PLANT LOCATION AND SIZE, QUEENSLAND
Authors: Cassidy P.A. , McCarthy W.O. , Toft H.I.
Published: April 2012

The objective of this study is to define in the cost minimizing sense the optimum size and location for beef slaughter plants in the Eastern Central Queensland region. The plant location model used for this purpose is a modified transhipment formulation. It is applied to both a long run unlimited capacity case and a short run limited capacity case. The analysis indicates that for both cases production‐area oriented slaughter minimizes costs. Sensitivity testing of the stability of the solution is outlined.
CHANGES IN FARM PRODUCTION UNDER INTENSIVE FARM MANAGEMENT ADVICE*
Authors: Southcombe F.J. , Mauldon R.G.
Published: April 2012

This investigation examines the impact of intensive farm management advice on levels and productivities of resource use on samples of farms. A total of 60 members of 13 farm management advisory services and 60 non‐members, matched by locality, were studied in two farming regions of Western Australia. A production model has been formulated and analysed which discriminates between effects of differences and changes in resource use and productivity over time and between members and non‐members. Major differences between members and non‐members over time have been rates of growth of inputs and outputs rather than systematic changes of production relationships.
A MODEL FOR THE ECONOMIC EVALUATION OF WATER QUALITY IN IRRIGATION
Authors: Yaron Dan , Bresler E.
Published: April 2012

A model for determination of the efficient combination of water quantity and quality (salinity) in irrigation is presented. The efficient combination is evaluated with respect to a predetermined threshold salt concentration in the soil solution. A leaching model, designed for tracing salt distribution in the soil profile, serves as the basis for the analysis. The optimal quantity‐quality combinations are derived with the aid of a linear programming model. An illustrative application of the model concludes the presentation.
SOME CURRENT POLICY ISSUES*
Authors: Lloyd Alan G.
Published: April 2012

A number of current policy issues are discussed which illustrate serious confusion and economic illiteracy in the minds of many influential farm leaders. The issues discussed are: the cost‐price squeeze in agriculture; the embargo on the export of merino rams; promotion of farm products; land policy; and tax concessions for agriculture. In some cases policies are followed which run counter to both farmer and national interests. Along with farm management extension, there is a growing need for agricultural policy extension.
ON ESTIMATING ALLOCATIVE EFFICIENCY IN CROSS‐SECTIONAL ANALYSIS OF PRODUCTION
Authors: Anderson Jock R. , Dillon John L.
Published: April 2012

In a recent reappraisal of evidence adduced for allocative efficiency in traditional agriculture, Dillon and Anderson employed a method based on a combination of traditional economic aspects and statistical aspects of estimated production functions. However, their reappraisal involved using marginal rather than the (appropriate) joint distributions of the regression coefficients. This paper investigates the error associated with using the inappropriate marginal distribution in a reassessment of allocative efficiency in wool growing in the Australian pastoral zone.
AGGREGATION OF MICRO‐FUNCTIONS TO OBTAIN A WHOLE‐FARM PRODUCTION FUNCTION*
Authors: Johnson R.W.M.
Published: April 2012

In this paper, a re‐assessment of the aggregation problem in farm production functions is attempted. Aggregation starts from measurable farm management entities such as the milking cow, breeding ewe etc., and appropriate whole farm production functions are derived that are consistent with these biological units of farming, or as they will be called, the micro‐functions of agriculture. The aggregate function, as derived, is based on the geometric means of micro outputs and inputs and could appropriately be said to 'represent' all the micro‐functions. It is thus called, later in the paper, the representative production function for the farm firm.
TECHNOLOGICAL CHANGE IN THE ARID ZONE OF NEW SOUTH WALES
Authors: Duncan Ronald C.
Published: April 2012

The results described challenge the generally accepted interpretation of the factors underlying the changes in sheep numbers in the arid zone of New South Wales. The extent to which long‐run changes in rainfall have been ignored is highlighted. Estimates of output per man are derived, using the C.E.S. production function, which show that there has been a small positive rate of technological change. Three‐quarters of such technological advance has been due to factors which affect numbers of sheep carried, the remainder due to factors affecting wool production per sheep.
A NEGATIVE INCOME TAX AND LOW INCOME FARM FAMILIES*
Authors: Chisholm Anthony H.
Published: April 2012

An efficient procedure is proposed for making welfare payments to low income farm families. This is a negative income tax. It uses the income tax system for linking directly transfer payments to income needs, without unduly adverse effects on resource allocation. The negative income tax proposal is considered in relation to rural adjustment and reconstruction.
PRODUCT TRADING — AN ALTERNATIVE TO TRANSFERABLE WHEAT QUOTAS
Authors: Powell Roy A.
Published: April 2012

This note examines the implications of permitting producers to trade wheat amongst themselves. The outcome, in efficiency terms, is identical to that achieved with transferable quotas. For some producers, there may be advantages in product trading that are not available in transferable quotas.
POLLUTION AND RESOURCE ALLOCATION*
Authors: Chisholm Anthony H. , Walsh Cliff , Brennan Geoffrey
Published: April 2012

Our economic perspective of the pollution problem characterizes that problem as involving a conflict between the consumption of two broad classes of goods–physical (or produced) commodities and the direct consumption of 'clean environment'. After considering the relative merits of market and political decision‐making processes used to achieve appropriate social choices between the consumption of physical goods and 'clean environment', we focus on the alternative policy options for pollution control. The main conclusion we reach is that, in general, fiscal instruments (taxes and subsidies) are a more efficient means of controlling pollution than the widespread use of regulations or other legal instruments.
FORECASTING FOR AUSTRALIAN AGRICULTURE
Authors: Freebairn John W.
Published: April 2012

The paper provides a review of the objectives of forecasts and of the techniques for generating forecasts in the context of agriculture. Forecasts provide information to facilitate decision making. The techniques are evaluated in terms of assumptions about the processes generating the forecast variables, their relative requirements for time, data and other resources, and their relative forecast accuracy. An evaluation of naive, informal model and econometric model forecasts of Australian agricultural commodity prices and production levels is reported.
OPTION VALUE
Authors: Olsen Graeme
Published: April 2012

The option value of a good is the amount which potential consumers of the good are prepared to pay now, to ensure that the good remains available for future purchase. Option values should be considered when making resource allocation decisions, so that efficient decisions are made. The theoretical basis of option value is described and the problems involved in the recognition, use and measurement of option value are discussed.
THE IMPACT OF SUPERVISED CREDIT PROGRAMMES ON TECHNOLOGICAL CHANGE IN DEVELOPING AGRICULTURE*
Authors: Scobie Grant M. , Franklin David L.
Published: April 2012

Restrictions on input use frequently accompany the granting of institutional credit to farmers in developing agriculture. A general economic framework is suggested to analyze the net social benefits of such a policy. The paper discusses the potential for manipulating the policy variables to foster more rapid adoption of new agricultural technology. An empirical analysis of the impact of a supervised credit programme in Guatemala on farm performance and farmer decision‐making is presented.
DISTRIBUTIONS OF INDEMNITIES FOR CROP‐INSURANCE PLANS: WITH APPLICATION TO GRAIN CROPS IN NEW SOUTH WALES
Authors: Battese George E. , Francisco Emilio M.
Published: April 2012

A review of crop‐insurance schemes is followed by a discussion of a guaranteed‐yield, crop‐insurance plan. General formulae for the distribution function and mathematical expectation of indemnities for the insurance plan are presented in terms of the distribution of crop yields. Three special cases are considered in which the original yields, the square root of yields, and the logarithm of yields are normally distributed. The insurance plan is applied on a regional basis for wheat and sorghum production in N.S.W. Given distributional information on the crops obtained from a simulation model, expected indemnities are calculated for four different insurance plans.
THE MILFORD TRACK: VALUATION ESTIMATES OF A RECREATION GOOD*
Authors: Woodfield Alan , Cowie Don
Published: April 2012

This paper uses observations on visitation rates to estimate Clawson demand functions for a non‐priced recreation commodity, namely, the Milford Track located in the Fiordland National Park of New Zealand. Different classes of user with potentially different demand elasticities are identified, and shadow prices consistent with revenue maximization of a discriminating and non‐discriminatory monopolist tourist authority are estimated. Alternative maximum revenue and consumers' surplus valuations are presented which correspond to different concepts of measures of willingness to pay for use, including travel costs and the opportunity cost of time.
FACTOR SUBSTITUTION IN AUSTRALIAN AGRICULTURE
Authors: Vincent David P.
Published: April 2012

Studies of the ease of substitution between inputs in production have generally been carried out within a production framework of an explicit functional form. In this study, a somewhat different approach is followed. A model of derived demand for primary factors of production, land, labour and capital is formulated to enable inferences to be made about the characteristics of the unspecified production function. The model is used to obtain estimates of the pairwise Allen‐Uzawa substitution elasticities which are secondary parameters of the underlying production function. The reported FIML estimates from aggregate time series data for the period 1920/21 to 1969/70 indicate very low and marginally different substitution elasticities between different pairs of factors, suggesting that both the Cobb‐Douglas and CES production function specifications for the Australian agricultural sector are inappropriate.
A NOTE ON THE PIG CYCLE IN AUSTRALIA
Authors: Griffith Garry R.
Published: April 2012

Spectral analysis is used to test hypotheses relating to regular four‐year cycles in the Australian pig industry. The data point to the existence of annual cycles in production, slaughterings and prices, but four‐year cycles are only evident in pig prices. Relationships between these series are also examined by cross‐spectral analysis
A QUARTERLY MODEL OF THE AUSTRALIAN AGRICULTURAL SECTOR*
Authors: Throsby C.D. , Rutledge David J.S.
Published: April 2012

Several farm sector econometric models are reviewed initially and the aggregation problem highlighted. A thirty‐equation model of the Australian agricultural sector is specified in which farm output, stocks and exports and the domestic demand for farm products are endogenous, as well as farm, export and retail prices. Disaggregation is into food and non‐food components of unprocessed output, and the processing of food is traced through to final demand. The model is estimated by a modified 2SLS procedure using quarterly data covering the period 1960‐1970.
BOOK REVIEWS
Authors: MORELLI EMERY A.
Published: April 2012

A Survey of Agricultural Economics Literature. Volume I. Traditional Fields of Agricultural Economics, 1940s to 1970s. Edited by LEE R. MARTIN.

Agriculture and the State‐British Policy in a World Context. Edited by B. DAVEY, T. E. JOSLING and A. MCFARQUHAR.

Agriculture in Development Theory. Edited by LLQYD G. REYNOLDS.

Socialist Agriculture in Hungary. By E. CSIZMADIA.

Crop Management Economics. By ALLAN N. RAE.
A COMPARISON OF DEPRECIATION METHODS UNDER CURRENT COST ACCOUNTING
Authors: Davey L.E.
Published: April 2012

In New Zealand the Richardson Report has recommended to government the adoption of a form of inflation accounting known as Current Cost Accounting (CCA). This paper reports research carried out to determine which of the traditional historical cost depreciation methods used in farm accounting might be most appropriate when adapted to a current cost basis. The current cost depreciation methods are compared on the basis of their ability to predict accurately actual replacement values for a survey sample of farm tractors and headers. The resultant measures of depreciation are compared with those currently allowable under New Zealand taxation laws, and the proposition that investment allowances on purchases of new machinery offset the inadequacies of historical cost depreciation is discussed.
EXPLAINING VARIATIONS IN SHARE CONTRACTS: LAND QUALITY, POPULATION PRESSURE AND TECHNOLOGICAL CHANGE
Authors: James William E. , Roumasset James A.
Published: April 2012

Substantial variations in landowner's share under sharecropping arrangements are documented. Partial relationships between landowner's share and land quality and between landowner's share and physiological population density are explained by extensions of the competitive theory of share tenancy. It is shown that high landowner's share can be expected to be associated with high land quality and or high physiological density. The tendency for increases in population to be associated with increases in landlords' shares can be ameliorated by land‐saving technological change.
OPTIMAL BUFFER STOCK POLICIES FOR WHEAT AT THE WORLD LEVEL
Authors: Kennedy John O.S.
Published: April 2012

Alternative wheat storage policies which maximise the expected present value of returns for consumers, producers, a monopoly storage agency and society as a whole are derived using a dynamic programming model. Results are compared with those from an earlier simulation model, and are found to justify higher investment in storage capacity compared with that suggested by the simulation model. The model is extended to derive optimal storage policies if production follows a stochastic cobweb process.
STABILISATION AND RISK REDUCTION IN AUSTRALIAN AGRICULTURE*
Authors: Quiggin John C. , Anderson Jock R.
Published: April 2012

Agricultural producers typically are faced with risk about the yields they will experience and the prices they will receive. Stabilisation schemes can spread risk and thereby reduce the risk faced by individual producers. The risk‐reducing capacity of a scheme and the cost of risk reduction depend upon the design of the scheme. In particular, it is important to distinguish between risk and instability. A classification of scheme designs is presented to bring out the effects of various design types. Schemes for the wheat industry are given most attention.
RISK ATTITUDES AMONGST AUSTRALIAN FARMERS
Authors: Bond Gary E. , Wonder Bernard
Published: April 2012

A procedure for the measurement of risk attitudes is developed and applied. The data for the analysis were obtained from a survey in which 201 farmers throughout Australia were asked to provide points of indifference between sure amounts of income and risky prospects. Although the conclusions from this pilot study are of a tentative nature, it is suggested that risk aversion is the most prevalent risk attitude in the agricultural sector. However, the average degree of risk aversion is relatively small and, in an expected utility context, farmers gave a wide variety of responses. The latter result highlights the need to consider the size distribution of risk attitudes in economic modelling. Influences of socioeconomic and other variables on risk attitudes are examined. The results, when considered jointly with other studies, emphasise the desirability of further research into the determination of risk attitudes.
INPUTS, OUTPUTS AND PRODUCTIVITY CHANGE IN THE AUSTRALIAN SHEEP INDUSTRY
Authors: Lawrence Denis , McKay Lloyd
Published: April 2012

Tornqvist quantity indexes of output and input are computed for the period 1952/53 to 1976/77 from Australian Sheep Industry Survey data. The computation includes estimating the annual service flow from durable inputs. Total productivity in the sheep industry is estimated to have increased by 2.9 per cent per annum during this 25‐year period. While the ratio of capital employed per unit of labour has increased, materials, services and livestock have been the inputs for which the quantity used has increased most rapidly. On the output side, there has been a move towards greater diversification with both crop and cattle enterprises on 'sheep properties' increasing in relative importance.
SUPPLY RESPONSE IN THE AUSTRALIAN SHEEP INDUSTRY: A CASE FOR DISAGGREGATION AND DYNAMICS*
Authors: Reynolds R.G. , Gardiner B.
Published: April 2012

Microeconomic capital goods theory was utilised to provide a theoretical framework on which a dynamic econometric model was based. Econometric procedures were then employed in an analysis of sheep producers' decision making regarding the annual supplies of wool, lamb and mutton, and annual changes in the inventory levels of sheep, lambs and ewes maintained for breeding purposes. Estimates show that wool prices provide the long‐run stimulus for increases and decreases in the sheep flock while mutton and lamb prices are responsible for short‐run changes in flock composition. Substitution between sheep and beef cattle is of considerable importance although no significant substitution between sheep and cropping could be found. Seasonal conditions proved to be an important short‐run supply shifter, affecting both numbers and composition of the sheep flock.
ASPECTS OF HEDGING THEORY
Authors: Goss Barry A.
Published: April 2012

In this paper, interpretative comments are offered on some established aspects of the economics of futures trading, including the nature of the equilibrium condition in the case of an inverse carrying charge, some inferences about traders' market positions made from estimates of returns, and the implications of the normal backwardation hypothesis in cases where hedgers are net long. The paper also includes a survey of the recent literature on the forward pricing function of futures markets, with a discussion of, inter alia, the methods used to investigate the hypothesis that futures prices are anticipations of delivery date spot prices, and the possible reasons why some markets perform this function better than others.
AGRICULTURAL SELLING CARTELS: RELATIVE CO‐OPERATOR AND NON‐COOPERATOR GAINS*
Authors: Piggott R. R.
Published: April 2012

An analytical framework is developed for assessing the relative gains accruing to co‐operators and non co‐operators in a cartel arrangement involving production quotas. Key parameters determining the relative gains are identified. The values of these parameters in the context of Australian agriculture could result in greater gains for non co‐operators than for co‐operators. Suggestions are offered on some types of information that should be sought in feasibility studies before cartels are established.
TREE REMOVALS AND SALINE SEEPAGE IN VICTORIAN CATCHMENTS: SOME HYDROLOGIC AND ECONOMIC RESULTS*
Authors: Greig P. J. , Devonshire P. G.
Published: April 2012

Average salt concentrations in a number of Victorian streams are related statistically to the proportions of their catchments cleared of trees for agriculture and to other catchment variables. A causal relationship is assumed, so that an economic evaluation of one of the external benefits of tree retention in a given catchment can be estimated. This is done by using the model to predict stream salinity increases that would occur with further clearing, and estimating the costs of such increases by either the costs experienced by water users, or the costs of restoring stream salinity to the original level. The methods are illustrated by application to a representative catchment.
RISK PERCEPTION AND THE ANALYSIS OF RISK ATTITUDES*
Authors: Quiggin John
Published: April 2012

Risk has long been recognised as an important feature of the environment facing farmers. In recent years the von Neumann‐Morgenstern expected utility theory has been used to analyse decision making under risk. However, many people behave in a manner inconsistent with the expected utility theory. One widely suggested explanation is based on subjective probability distortion. A number of attempts to incorporate this phenomenon into utility theories have been made. In this paper, the problems of analysing subjective probability distortion are discussed. Evidence from a survey of farmers' risk attitudes undertaken in conjunction with the 1977 BAE Australian Agricultural and Grazing Industries Survey is analysed in the light of this discussion.
A NOTE ON DECREASING ABSOLUTE RISK AVERSION AMONG FARMERS IN NEPAL
Authors: Hamal K.B. , Anderson Jock R.
Published: April 2012

Attitudes toward risk are explored for a sample of rice growers on small farms in Nepal, in the context of the subjective expected utility maximisation model. Farmers are found to be generally averse to risk, with diverse levels of absolute risk aversion that tend to diminish as wealth increases, both for individuals and in a cross‐sectional sense. Relative risk aversion is argued to be the most comparable measure for contrasts of attitudes toward risk.
SUPPLY RESPONSE WITH STOCHASTIC TECHNOLOGY AND PRICES IN AUSTRALIA'S RURAL EXPORT INDUSTRIES
Authors: Easter Christopher D. , Paris Quirino
Published: April 2012

Risky output prices and production characterise Australian agriculture. Exports are vitally important, sometimes relying heavily on a particular market. In this study a model is developed to include explicitly both output price and technological risks as well as multiple output relationships. It is used to show that changes in US beef import policy generating a 10 per cent beef price fall could reduce Australian beef supply by 3.5 per cent and grazing industry net revenue by 8.4 per cent, despite some switching from beef production to other enterprises.
THE EEC SHEEPMEAT MARKET AND VOLUNTARY EXPORT RESTRAINT AGREEMENTS
Authors: Blyth Nicola
Published: April 2012

Voluntary export restraint agreements are an increasingly common measure used to restrict international trade in particular commodities. They have been applied to the EEC sheepmeat market since 1980 as part of the Common Agricultural Policy. In this paper, theoretical implications of voluntary export restraints are analysed and compared with alternative trade barriers, such as variable levies. The effects of the various trade barriers which the EEC could impose on sheepmeat imports are quantified using an econometric model of the world sheepmeat market. From the exporters' viewpoint, voluntary export restraints are shown to be the least harmful form of providing protection against imports into the EEC.
PERSPECTIVES ON ASSESSING THE IMPACTS OF IMPROVED AGRICULTURAL TECHNOLOGIES IN DEVELOPING COUNTRIES
Authors: Hardaker J. Brian , Anderson Jock R. , Dillon John L.
Published: April 2012

While the role of technical change in agriculture is seen differently by protagonists of different theories of development, the processes of technology generation and uptake are widely seen as progressive. In this vein, agricultural technology assessment is seen as contributing to research policy and management and also to the formulation, monitoring and evaluation of broader rural development policies and programs. A need for both farm‐level and aggregate‐level assessments is identified, and methods applied at each level are reviewed. At the farm level, some insights are provided by the farming systems research approach leading to recognition of a changed role for economists in farm‐level impact assessment. At the aggregate level, the problems of tracing out all the important consequences of a technical innovation can be severe. Analysts will generally need to account for general equilibrium effects, distorted prices and welfare considerations, as well as the dynamic interaction between technology and institutions. In the light of the discussion, an agenda of unfinished business for agricultural economists is suggested.
RURAL ASSISTANCE LEVELS: THE INFLUENCE OF POLICIES AND WORLD PRICE CHANGES
Authors: Haynes J. E.
Published: April 2012

Two aspects of effective rates of assistance for Australian agricultural industries are examined. The long‐term rate, rather than the rate for a single year, is determined and a rationale is sought for the pattern of assistance that emerges. Second, the influence of exogenous factors (as represented by changes in world prices) on assistance rates is examined. Assistance elasticities are calculated for the major agricultural commodities and estimates made of the likely change in the pattern of assistance rates from any general world price change. In addition, commodities with assistance rates potentially very different from existing rates are identified. Price transmission elasticities are also derived to indicate the degree of insulation that the various policies provide for each commodity.
THE IMPACT OF QUOTAS ON THE SOUTHERN BLUEFIN TUNA FISHERY
Authors: Kennedy John O.S. , Watkins James W.
Published: April 2012

Recent increases in the harvests of southern bluefin tuna, particularly by Australian fishermen, have led to the recognition that the fishery is overexploited. A model is developed to examine the effects that quotas on Australian and Japanese harvesting would have on economic welfare and on stock levels. Recursive quadratic programming is used to simulate harvesting decisions through time, with and without the imposition of quotas.
BASIS RISK AND HEDGING STRATEGIES FOR AUSTRALIAN WHEAT EXPORTS
Authors: Bond Gary E. , Thompson Stanley R. , Geldard Jane M.
Published: April 2012

Basis risk can play a significant role in the determination of effective hedging strategies. In this paper a portfolio framework is developed to examine the effect of basis risk on hedging strategies for Australian wheat exports. Monthly data for the period 1977 to 1984 were used to implement the analytical framework. While the traditional definition of hedging implies a hedge ratio of unity, the results of this research show that the average ratio of optimal hedge to stockholding is well below unity. Evolving market conditions can also cause the optimal hedge ratio to vary substantially over time.
THE EFFECT OF FERTILISER ON RISK: A HETEROSCEDASTIC PRODUCTION FUNCTION WITH MEASURABLE STOCHASTIC INPUTS
Authors: Rosegrant Mark W. , Roumasset James A.
Published: April 2012

The sources of production risk are many and diverse in nature. Estimating risk as a black box, without explicit recognition of its sources, can lead to inferior estimates of optimal inputs under risk aversion. In this paper, a method is presented for estimating production functions with measurable stochastic inputs and for generating the parameters of the probability distributions of yield for various environments and input levels. Based on this method, it appears that moderate risk aversion can account for a 6.7 per cent to 16.7 per cent reduction in nitrogen use (relative to the risk‐neutral solution) for selected rice producing areas of the Philippines. Estimating optimal inputs without environment specific information about the sources of risk leads to large errors. This underscores the value of collecting information about the sources of risk and of exercising caution when such information is not available.
A COMPARATIVE ANALYSIS OF AGRICULTURAL TRACTOR INVESTMENT MODELS
Authors: Vanzetti David , Quiggin John C.
Published: April 2012

An implicit rental price approach is used to analyse the determinants of farm tractor investment at the aggregate level. Three models, based on different assumed factor substitutabilities, are compared. Variations in the rental price of tractors appear to have less effect on demand than variations in factors affecting the profitability of the cropping enterprise as a whole. The implications for forecasting and for policy instruments, such as the investment allowance, are discussed.
SOME CURRENT ISSUES IN THE MARKETING OF AGRICULTURAL PRODUCTS*
Authors: Richardson Bob
Published: April 2012

The subject of 'marketing' as a field of agricultural policy and applied research is discussed in this paper. Agribusiness approaches to marketing advanced in recent years are argued to have made little contribution to policy or research and are rejected in favour of the more traditional framework of applied economic analysis. Developments in government policy on national statutory marketing authorities for agricultural products are appraised along with some evidence on the allocation of research effort revealed in professional journals. It is argued that more research should be conducted on the impact of the promotion of agricultural products and on the efficiency and distributional impact of marketing policies of statutory marketing authorities.
WHAT DOES MANUFACTURING PROTECTION COST FARMERS? A REVIEW OF SOME RECENT AUSTRALIAN CONTRIBUTIONS
Authors: Parmenter B.R.
Published: April 2012

A method proposed by Clements and Sjaastad for measuring the effect of manufacturing protection on farmers' incomes is shown to be theoretically unsound, to use some inappropriate assumptions and to lead to overestimation. Even if corrected, the method seems inferior to estimating directly via ORANI the change in farm incomes which would occur when protection levels change. This is because the model contains detailed theoretical explanations of the price and quantity changes which determine changes in the relevant incomes and is calibrated using extensive empirical evidence about the behaviour of the prices and quantities in the Australian economy. Using ORANI and incorporating recently completed improvements to its agricultural data base, it is estimated that, in the short run, abolishing protection would increase farm incomes by about 17 per cent.
PRODUCTION INTERRELATIONSHIPS IN SRI LANKAN PEASANT AGRICULTURE
Authors: Shumway C. Richard , Jegasothy Kandiah , Alexander William P.
Published: April 2012

Technical change and the extent to which commodity supplies and input demands are interrelated in Sri Lankan peasant agriculture are explored in this paper. Using a multiple‐product dual model, a seemingly unrelated system of product supply and input demand equations is estimated for four crops and four variable inputs. Restrictions based on competitive behaviour and a twice continuously‐differentiable production function are maintained in the non‐linear least squares estimation. A number of important interrelationships in individual product supplies and input demands are identified, further documenting the need to account for intercommodity production relationships in econometric and simulation studies and in policy formulation. Non‐joint production and Hicksneutral technical change are both rejected.
A DYNAMIC ANALYSIS OF US EXPORT WHEAT PRICING AND MARKET SHARES
Authors: Ahmadi‐Esfahani Fredoun Z. , Carter Colin A.
Published: April 2012

The economics of a higher loan rate to support US wheat prices is analysed. Utilising optimal control theory, a dynamic wheat trade model is developed. The basic premise underlying the model is that the United States finds itself having transient monopoly power in the wheat market. An expression for the optimal pricing policy which maximises the present value of expected profits over the indefinite future is derived. Results from both the theoretical and empirical models demonstrate that the US wheat pricing strategy depends on its costs relative to competitors' costs, the discount rate and the competitors' response function. The main policy implication of the analysis is for the dominant wheat exporting country constantly to seek to lower costs relative to competitors and to maintain a price exceeding unit cost without encouraging competitors' expansion.
TOWARD A FRAMEWORK FOR EVALUATING AGRICULTURAL ECONOMICS RESEARCH*
Authors: Lindner Robert K.
Published: April 2012

Agricultural economists need to evaluate their own research priorities. The main difficulty in doing so is to value the types of information generated by economic research. Bayesian decision theory provides a framework for valuing information, and the results of selected studies using this methodology are collated. Most of the other determinants of research priorities can be encapsulated in a target return ratio measure. How such a framework might be used is illustrated by three 'hypotheticals'.
WORLD AGRICULTURE IN DISARRAY REVISITED*
Authors: Johnson D. Gale
Published: April 2012

In World Agriculture in Disarray I argued that the result of government intervention in agriculture would be to increase the costs of farm policies to taxpayers and consumers and to restrict agricultural trade. A review of the current situation in world agriculture confirms these projections. The policies of the major countries in relation to agriculture have clearly not succeeded in their aims and at the same time have created many problems, particularly in the sphere of agricultural trade. The solution to the crisis in the farm sector must take account of the inherent characteristics of agriculture itself.
ECONOMIC ASPECTS OF LAND DEGRADATION IN AUSTRALIA
Authors: Kirby Michael G. , Blyth Michael J.
Published: April 2012

In this article an overview of several economic aspects of land degradation in Australia is presented. The economic rationale for government intervention in land management decisions relating to degradation is explored. Some potential sources of inefficient private land use decisions are identified. However, there are significant difficulties in designing policies which will result in resource allocation decisions superior to market outcomes.
TAXATION, COST OF CAPITAL AND INVESTMENT IN AUSTRALIAN AGRICULTURE*
Authors: Lewis Philip E.T. , Hall Nigel H. , Savage C.R. , Kingston A.G.
Published: April 2012

The concept and measurement of the cost of capital is developed to include particularly the role of taxation in investment behaviour. The relative importance of factors influencing investment in plant and machinery is examined for five sectors which make up the broadacre industry of Australia. It is shown that residual funds are important in determining plant and machinery investment, but not through the normally hypothesised channels. It is not the increased liquidity from increased income which raises investment, but the fall in the cost of capital, which is associated with the marginal rate of tax.
A METHOD FOR EVALUATING SUPPLY RESPONSE TO PRICE UNDERWRITING
Authors: Fraser Rob W.
Published: April 2012

In this paper a method for evaluating the supply response of individual producers to a price underwriting scheme is presented. The method includes precise formulae to take account of the impact of price underwriting on the producer's uncertain conditions. The Australian Wheat Board's guaranteed minimum price scheme is taken as a specific example of price underwriting in practice. Results show the scheme to lead to only relatively small supply responses. The impact on producer behaviour of an increase in price uncertainty in the presence of an underwriting scheme is also demonstrated in the paper.
UTILITY‐EFFICIENT PROGRAMMING FOR WHOLE‐FARM PLANNING*
Authors: Hardaker J. Brian , Patten Louise H. , Pannell David J.
Published: April 2012

A programming technique, utility‐efficient programming, is developed for farm planning under risk. The objective function is the parametric sum of two parts of the utility function in which the degree of risk aversion varies systematically with the parameter. This technique has several advantages over those previously available: a number of types of utility functions are applicable including ones exhibiting decreasing risk aversion; the degree of risk aversion can be limited to a plausible range; the form of the distribution for activity net revenues is flexible; and the technique can be used with available algorithms. The method is illustrated using a parametric linear programming algorithm.
EMPIRICAL TESTS OF HYPOTHETICAL BIAS IN CONSUMERS' SURPLUS SURVEYS
Authors: Sinden Jack A.
Published: April 2012

Questionnaire surveys are an established economic research method for eliciting consumers' surplus values. However, the necessarily hypothetical nature of surveys may not promote truthful responses. In 17 empirical tests, actual money donations were elicited and compared to hypothetical donations elicited previously. In all 17, there was no statistical difference between the actual and hypothetical willingness to pay. Hypothetical bias was therefore absent in all these tests.
A TEST OF BAYESIAN LEARNING FROM FARMER TRIALS OF NEW WHEAT VARIETIES*
Authors: Lindner Robert K. , Gibbs Melissa
Published: April 2012

In this study, elicited estimates of farmers' subjective beliefs about the mean and variance of wheat variety yields were used to test propositions about Bayesian learning developed in the recent literature on innovation adoption. A series of empirical tests of the Bayesian adoption model were conducted using beliefs elicited from farm surveys conducted in 1982, 1983 and 1984. The results of the analysis neither confirm nor reject the Bayesian approach as a model of how farmers revise subjective beliefs, but do raise serious doubts about its realism, and suggest some issues requiring further investigation. Shortcomings in the elicitation techniques are discussed and the assumptions of the Bayesian model are reviewed.
ESTIMATING SOURCES OF FLUCTUATIONS IN THE AUSTRALIAN WOOL MARKET: AN APPLICATION OF VAR METHODS
Authors: Myers Robert J. , Piggott Roley R. , Tomek William G.
Published: April 2012

Vector autoregression (VAR) methods are used to analyse the contribution of supply, demand and policy shocks to unpredictable fluctuations in the market for Australian wool. VAR procedures are compared with conventional structural econometric models as methods for decomposing sources of instability. While each has advantages and disadvantages, VAR procedures might be viewed as preferable when the underlying market structure is complex and uncertain, as it is in the case of wool. Based on the results obtained, demand shocks are the dominant source of uncertainty in the wool market in the absence of Australian Wool Corporation intervention, but intervention has blunted their effects, reducing market uncertainty and increasing the average level of prices and revenues.
INCOMPLETE DEMAND SYSTEMS AND SEMILOGARITHMIC DEMAND MODELS
Authors: LaFrance Jeffrey T.
Published: April 2012

The methodology of LaFrance and Hanemann for analysing the structure of incomplete demand systems is applied to models that are linear or logarithmic in quantities, prices and/or income. The structure of each model is presented when the implications of consumer choice theory are satisfied. The usefulness of the approach is illustrated. It is shown that considerable prior information is obtained from the theory of consumer choice when it is applied to this set of functional forms for demand equations.
SUPPLY RESPONSE IN THE AUSTRALIAN SHEEP INDUSTRY: A PROFIT FUNCTION APPROACH*
Authors: Fisher Brian S. , Wall Charles A.
Published: April 2012

Profit function models for the three major regions in which the Australian sheep industry operates are specified and estimated. The supply response elasticity estimates are made using a normalised quadratic functional form and time series cross‐sectional data. Elasticity estimates, together with their confidence intervals, are presented for the pastoral, wheat‐sheep and high rainfall zones. In general, the supply response elasticity estimates derived in this study are lower than those previously reported for studies in which little or no account has been taken of the multi‐product nature of Australian agriculture.
EVALUATING THE LEVEL AND DISTRIBUTION OF BENEFITS FROM DAIRY INDUSTRY RESEARCH
Authors: Freebairn John W.
Published: April 2012

A model and associated formulae are developed to estimate the size and distribution of benefits generated by different types of research for the Australian dairy industry. Particular attention is given to the influence of policy interventions on the estimates. The estimates of aggregate research benefits differ for free market assumptions versus current policy assumptions, but quantitatively the differences are small. By contrast, estimates of the distribution of benefits between different groups of consumers and farmers are significantly altered by the policy interventions.
EVALUATING LONG‐LIVED PROJECTS: THE ISSUE OF INTER‐GENERATIONAL EQUITY
Authors: Young R.
Published: April 2012

The role of the discount rate in benefit‐cost analysis is reviewed, and its impact considered. A positive rate clearly 'tilts the balance overwhelmingly against generations in the distant future'. In this context, the issue of inter‐generational equity is discussed, and it is concluded that although a positive rate representing social time preference or opportunity cost is appropriate when considering questions of economic efficiency, this is not the case when equity questions are being examined. In the case of irreversible change, an extreme example of inter‐generational inequity, there may be no alternative to a constrained optimisation approach, where the constraint is determined by an ethical decision. A range of approaches for analysing the issue of inter‐generational equity are canvassed and it is concluded that efficiency and equity questions need to be dealt with separately. If the analysis of the options on each issue are set out clearly, then policy makers will be better placed to make an informed and responsible decision.
AN ANALYSIS OF WILLINGNESS‐TO‐PAY FOR CROP INSURANCE*
Authors: Fraser Rob W.
Published: April 2012

In this paper a method for estimating a producer's willingness‐to‐pay for crop insurance is presented. The method includes formulae to capture the impact of crop insurance on the producer's expected income and variance of income. These impacts are evaluated in the context of a model of producer welfare which features both price and yield uncertainty, as well as risk aversion on the part of the producer. The method is applied to the Australian wheat industry and estimates of willingness‐to‐pay are shown to be relatively sensitive to the levels of coverage and yield variability.