bluuebunny/crossref_metadata_2025 huggingface dataset:
The Provision Point Mechanism and Scenario Rejection in Contingent Valuation
Authors: Groothuis Peter A. , Whitehead John C.
Published: September 2016

The provision point mechanism mitigates free-riding behavior in economic experiments. In two contingent valuation method surveys, we implement the provision point design. We ask respondents for their perceptions about the success of the provision point mechanism. We find that respondents who believe that the provision point would not be met are more likely to saynoto a contingent valuation dichotomous choice question. The scenario rejection that arises may result in biased willingness-to-pay estimates.
A Market-based Mitigation Program for Wind-borne Diseases
Authors: Bekkerman Anton , Piggott Nicholas E. , Goodwin Barry K. , Jefferson-Moore Kenrett
Published: September 2016

Wind-borne diseases can spread rapidly and cause large losses. Producers may have little incentive to prevent disease spread because prevention may not be welfare-maximizing. This study proposes a market-based mitigation program that indemnifies producers against disease-related losses and provides an incentive to neighboring producers to take preventive action, which can substantially mitigate infestations, reduce the likelihood of catastrophic losses, and increase social welfare. An equilibrium displacement model simulates introduction of the program for U.S. soybeans. Simulations reveal that the market-based solution contributes to minor market distortions but also reduces social welfare losses and could succeed for other at-risk commodities.
The Role of Promotion Programs for U.S. Poultry Exports
Authors: Shahid Abdus , Gempesaw Conrado M.
Published: September 2016

This study examines the effectiveness of price versus nonprice promotion programs for U.S. poultry exports. A comparative static simulation framework is specified for this purpose. The elasticities needed for the simulation model are estimated using seemingly unrelated regression and time-varying parameter regression techniques. Results from this study indicate that a price subsidy is more effective than nonprice market promotion programs in raising export demand for U.S. poultry.
Practices Used by Dairy Farmers to Reduce Seasonal Production Variability
Authors: Washington Andrew A. , Kilmer Richard L. , Weldon Richard N.
Published: September 2016

The objective of this analysis was to identify the production practices used by farmers to change seasonal production. Production practices included milk production per cow, proportion of cows milking, number of first lactation animals entering the herd, number of cows leaving the herd, number of days to first breeding, and calves born. Farms that participated in a seasonal pricing plan during 1993, 1994, and 1995 decreased production practice seasonality in response to price premiums, which caused a decrease in production seasonality compared to nonparticipating farms. Participating farms showed a preference for adjusting entering first lactation animals and number of calves born, but did make adjustments in other practices as well.
Evaluation of Alternative Risk Specifications in Farm Programming Models
Authors: Ford Stephen A. , Ford Beth Pride , Spreen Thomas H.
Published: September 2016

The use of alternative probability density functions to specify risk in farm programming models is explored and compared to a traditional specification using historical data. A method is described that compares risk efficient crop mixes using stochastic dominance techniques to examine impacts of different risk specifications on farm plans. Results indicate that a traditional method using historical farm data is as efficient for risk averse producers as two other methods of incorporating risk in farm programming models when evaluated using second degree stochastic dominance. Stochastic dominance with respect to a function further discriminates among the distributions, indicating that a density function based on the historic forecasting accuracy of the futures market results in a more risk-efficient crop mix for highly risk averse producers. Results also illustrate the need to validate alternative risk specifications perceived as improvements to traditional methods.
Contingent Valuation Focus Groups: Insights from Ethnographic Interview Techniques
Authors: Johnston Robert J. , Weaver Thomas F. , Smith Lynn A. , Swallow Stephen K.
Published: September 2016

Despite the many important uses (and potential abuses) of focus groups in survey design, the CV literature presents few guidelines to aid moderators in their interaction with focus group participants. This paper draws on the theory and practice of ethnographic interviewing to introduce general guidelines that can improve focus groups as an aid to CV research. The proposed guidelines illustrate types of questions that should reduce speculation and moderator-introduced bias in focus group responses, and improve the correspondence between focus group responses and actual behavior. The paper illustrates these ethnographic guidelines through a CV application concerning watershed resources.
Solving Stochastic Models of Competitive Storage and Trade by Chebychev Collocation Methods
Authors: Miranda Mario J. , Glauber Joseph W.
Published: September 2016

We show how to solve the stochastic spatial-temporal price equilibrium model numerically using the Chebychev collocation method. We then use the model to analyze the joint and interactive stabilizing effects of competitive storage and trade.
Economic Analysis of the Impacts of Bovine Somatotropin on the Profitability of Representative Dairy Farms in the Northeast
Authors: Elbehri Aziz , Yonkers Robert D.
Published: September 2016

This study evaluated the impacts of bST on the profitability of representative Pennsylvania dairy farms using a stochastic simulation model under two initial milk yield-per-cow levels, three levels of milk response to bST, and three milk price forecast scenarios. Results showed that farm profitability was improved with bST, but the magnitude of the benefits from bST depended on the farm's initial milk output per cow and the level of milk response to bST, both of which are related to quality of management. However, modest price declines due to bST-induced increases in the milk supply would have an offsetting effect on farm profitability.
Price Bargaining Without Supply Control
Authors: Kinnucan Henry W.
Published: September 2016

Primary food producers are permitted to bargain as a group for higher prices. Supply response, however, is critical to the long-run success of producer cartels. This article presents a model that elucidates that role of supply response in agricultural price bargaining when no overt action is taken to limit quantity and participation in the cartel is voluntary. Free-riding, for example, is seen as having a dual nature: it undermines the cartel's influence at the negotiating table but it enhances the cartel's ability to sustain a negotiated price increase by attenuating supply response. That price bargaining can result in significant transfers from processors to producers when demand is inelastic and supply is uncontrolled is highlighted in the empirical application.
The Profitability of Sustainable Agriculture on a Representative Grain Farm in the Mid-Atlantic Region, 1981–89: Comment
Authors: Roberts Wayne S. , Swinton Scott M.
Published: September 2016

A long term whole farm analysis comparing conventional and low-input farming systems is reviewed. A computational error led to the mistaken conclusion that conventional farming with government programs is less preferred by risk-averse farmers than the low input alternative. The greater income variance of conventional agriculture need not make it less preferred provided a higher mean income sufficiently offsets the higher variance.
Factors Associated with Backyard Composting Behavior at the Household Level
Authors: Park William M. , Lamons Kevin S. , Roberts Roland K.
Published: September 2016

Communities in most states are under pressure to reduce the amount of solid waste going into landfills. Many are making efforts to encourage their citizens to practice backyard composting. A logit regression analysis was conducted to identify factors associated with backyard composting of yard and food wastes in a case study area. Sample data were obtained through a September 1997 telephone survey of 865 households residing in single-family dwellings in Knox County, Tennessee. Findings indicate that a number of variables reflecting complementary behavior, attitudes, knowledge, and peer influence were significantly related to composting behavior. Policy implications of these findings are outlined.
Effects of Post-Harvest Treatment Requirements on the Markets for Oysters
Authors: Muth Mary K. , Karns Shawn A. , Anderson Donald W. , Murray Brian C.
Published: September 2016

Because of public health concerns, regulators are considering requiring post-harvest treatment of halfshell and shucked oysters by wholesalers and processors. Two recently developed post-harvest treatment technologies may actually reduce the costs of producing shucked oysters, but would increase the costs of halfshell oysters. An interregional model of the wholesale oyster industry is developed to estimate the effects of treatment requirements on prices, output, and employment. If post-harvest treatment is required for all Gulf oysters, price increases are estimated to be less than 20% and, in some cases, prices decrease. Results indicate producer and consumer losses in the halfshell market are partially or more than offset by gains in the shucked market.
Watershed Nutrient Trading Under Asymmetric Information
Authors: Johansson Robert C.
Published: September 2016

This study evaluates first- and second-best trading policies for regulating watershed phosphorus under asymmetric information. The trading policies are differentiated on the degree to which regulators observe point and nonpoint source abatement efforts. The efficiency losses attributable to these informational asymmetries and those of the second-best policies can be measured in social welfare, and provide regulators the shadow value of foregoing first-best measures. Given representative monitoring costs from national water monitoring programs, it is shown that under asymmetric information, the chosen second-best trading policies outperform first-best policies by 11% in the control of watershed nutrient pollution.
Implications of Dairy Imports: The Case of Milk Protein Concentrates
Authors: Bailey Kenneth W.
Published: September 2016

Imports of milk protein concentrates (MPCs) are increasingly entering the United States with minimal trade restrictions. MPC is a general reference to a dried protein product derived from milk using a technology known as “ultra filtration.” Two questions are addressed in this article. First, did the combination of relaxed import restrictions, low world prices for protein, and relatively high domestic support levels for nonfat dry milk encourage imports of MPCs? Second, did increased imports of MPC displace domestic use of nonfat dry milk and thereby increase government purchases under the dairy price support program? This study has implications for U.S. trade policy.
Does Healthy Food Cost More in Poor Neighborhoods? An Analysis of Retail Food Cost and Spatial Competition
Authors: Hatzenbuehler Patrick L. , Gillespie Jeffrey M. , O'Neil Carol E.
Published: September 2016

The organization of the Baton Rouge, Louisiana, retail food industry was analyzed to determine whether spatial competition influenced the cost and availability of food items. Using a spatial competition gravity variable, the costs of two separate market baskets were analyzed in January 2009, and the factors influencing spatial competition were determined. Store type (chain or supercenter) was found to be the most significant determinant of food costs, validating findings of past studies. Although food was not found to be more expensive in low-income areas, results suggest that residents in low-income and rural areas have disincentives to purchase affordable, available healthy food due to the spatial organization of their local food market.
Trigger Foods: The Influence of “Irrelevant” Alternatives in School Lunchrooms
Authors: Hanks Andrew S. , Just David R. , Wansink Brian
Published: September 2016

Rational choice theory commonly assumes that the presence of unselected choices cannot impact which among the remaining choices is selected—often referred to as “independence of irrelevant alternatives.” We show that such seemingly irrelevant alternatives influence choice in a school lunch setting. In these lunchrooms, we provide evidence that the presence of specific side dishes—trigger foods—can strongly increase the sales of unhealthy à la carte options, even when the trigger foods are not selected. This behavioral anomaly can be exploited to lead children to healthier choices. We also offer a method that can be used to identify such foods.
Consumer Perceptions of Sustainable Farming Practices: A Best-Worst Scenario
Authors: Sackett Hillary M. , Shupp Robert , Tonsor Glynn
Published: September 2016

Building on existing work evaluating food-attribute labels, we use data collected in 2010 from a national web-based survey of 1,002 households to examine consumer inferences and valuations of food products promoted as “sustainably produced.” A best-worst scale framework was implemented to identify how consumers define “sustainably produced” and their preferences for each of the sustainable farming practices considered. The results suggest that consumers perceive farm size and local production as important elements of sustainable agriculture while economic attributes exhibit a significant amount of heterogeneity, indicating segmentation in the sample and the potential for targeted marketing.
How Greenhouse Gas Emission Policy and Industry Pressure Could Affect Producer Selection of Rice Cultivars
Authors: McFadden Brandon R. , Nalley L. Lanier , Popp Michael P.
Published: September 2016

This study estimates how potential carbon policies targeted at reduction of greenhouse gas (GHG) emissions could affect selection of rice cultivars by conducting a life cycle assessment of GHG emissions and estimating the carbon sequestered for fourteen commonly sown rice cultivars across Arkansas. Market-oriented carbon-offset credits based on additionality likely would be insufficient to convince producers to change cultivars; nonetheless, there may be upstream pressure as food retailers strive to lower their overall carbon footprints. Given their higher yield per unit of GHG emission, hybrid rice cultivars appear to be positioned to respond to industry demand.
Using Field-level Characteristics as Proxy Measures to Test for the Presence of Economies of Scale in Nonpoint Pollution Control
Authors: Caplan Arthur J. , Gilbert John , Chatterjee Devalina
Published: September 2016

We use parametric and nonparametric methods to estimate correlations between average control cost and three field-level characteristics—field size and delivered phosphorous per field and per acre—as proxies for economies of scale in controlling nonpoint pollution. We combine load and delivery-ratio estimates for more than 12,000 fields in the Bear River Basin, Utah, with estimates of control costs and effectiveness of management practices from the literature. Results suggest a negative relationship between control cost and delivered phosphorous per field and per acre. Ranking fields by phosphorous load therefore prioritizes management-practice subsidies by economies of scale.
The Impact of Reducing Greenhouse Gas Emissions in Crop Agriculture: A Spatial-and Production-Level Analysis
Authors: Nalley Lanier , Popp Mike , Fortin Corey
Published: September 2016

With the Waxman-Markey Bill passing the House and the administration's push to reduce carbon emissions, the likelihood of the implementation of some form of a carbon emissions policy is increasing. This study estimates the greenhouse gas (GHG) emissions of the six largest row crops produced in Arkansas using 57 different production practices predominantly used and documented by the University of Arkansas Cooperative Extension Service. From these GHG emission estimates, a baseline state “carbon footprint” was estimated and a hypothetical GHG emissions reduction of 5, 10, and 20 percent was levied on Arkansas agriculture using a cap-and-trade method. Using current production technology and traditional land use choices, results show that the trading of carbon-emitting permits to reduce statewide GHG emissions by 5 percent from the baseline would enhance GHG emissions efficiency measured as net crop farm income generated per unit of carbon emissions created. The 5 percent reduction in GHG emissions does cause marginal reductions in acres farmed and has marginal income ramifications. Beyond the 5 percent reduction target, gains in GHG emissions efficiency decline but remain positive in most counties through the 10 percent GHG reduction target. However, with a 10 percent GHG reduction, acreage and income reductions more than double compared to the 5 percent level. When GHG emissions are reduced by 20 percent from the baseline, the result is a major cropping pattern shift coupled with significant reductions in traditional row crop acreage, income, and GHG emissions efficiency.
Can Crop Insurance Premiums Be Reliably Estimated?
Authors: Ramirez Octavio A. , Carpio Carlos E. , Rejesus Roderick M.
Published: September 2016

This paper develops and applies a methodology to assess the accuracy of historical loss-cost rating procedures, similar to those used by the U.S. Department of Agriculture's Risk Management Agency (RMA), versus alternative parametric premium estimation methods. It finds that the accuracy of loss-cost procedures leaves much to be desired, but can be markedly improved through the use of alternative methods and increased farm-level yield sample sizes. Evidence suggests that the high degree of inaccuracy in crop insurance premium estimations through historical loss-cost procedures identified in the paper might be a major factor behind the need for substantial government subsidies to keep the program solvent.
Intensity of Precision Agriculture Technology Adoption by Cotton Producers
Authors: Paxton Kenneth W. , Mishra Ashok K. , Chintawar Sachin , Roberts Roland K. , Larson James A. , English Burton C. , Lambert Dayton M. , Marra Michele C. , Larkin Sherry L. , Reeves Jeanne M. , Martin Steven W.
Published: September 2016

Many studies on the adoption of precision technologies have generally used logit models to explain the adoption behavior of individuals. This study investigates factors affecting the intensity of precision agriculture technologies adopted by cotton farmers. Particular attention is given to the role of spatial yield variability on the number of precision farming technologies adopted, using a count data estimation procedure and farm-level data. Results indicate that farmers with more within-field yield variability adopted a higher number of precision agriculture technologies. Younger and better educated producers and the number of precision agriculture technologies used were significantly correlated. Finally, farmers using computers for management decisions also adopted a higher number of precision agriculture technologies.
Consumer Perceptions of Eco-friendly and Sustainable Terms
Authors: Campbell Benjamin , Khachatryan Hayk , Behe Bridget , Dennis Jennifer , Hall Charles
Published: September 2016

Common marketing strategies include emphasizing products’ “green” or environmentally friendly attributes and characteristics to appeal to a growing market of environmentally conscious consumers. While previous studies have used product labels such as “eco-friendly,” “environmentally friendly,” and “sustainable” to investigate consumer preferences, relatively little is known about how consumer perceptions as a pre-decision mechanism impact their preferences and choice behaviors. Using data collected through an online survey of U.S. and Canadian consumers, we investigate systematic differences in individuals’ perceptions of the terms “eco-friendly” and “sustainable.” Marketing implications for the food and green (i.e., greenhouse/nursery producers, suppliers, and retailers) industries are discussed.
Reports of Water Quality Violations Induce Consumers to Buy Bottled Water
Authors: Pape Andreas Duus , Seo Misuk
Published: September 2016

The 1996 Safe Drinking Water Act Amendments required that water utilities send quality reports to customers. We test whether receiving such reports of health violations increases purchases of bottled water using newly released data and disaggregate changes in demand at the intensive and extensive margins. We find that a water-quality violation makes American households 25 percent more likely to purchase bottled water and, among purchasers, expenditures increase 4–7 percent, both larger responses than found in previous studies. Consumers spend approximately $300 million per year—about 4 percent of annual national spending on bottled water—to avoid health risks associated with violations.
Determinants of Purchase Likelihoods and Amounts Spent on Meat in Malaysia: A Sample Selection System Approach
Authors: Tan Andrew K. G. , Yen Steven T. , Hasan Abdul Rahman , Muhamed Kamarudin
Published: September 2016

A sample selection system is used to examine factors associated with likelihoods of purchase and amounts spent on fresh, frozen, and processed meats in Malaysia based on data from the 2009/10 Malaysian Household Expenditure Survey. Statistical tests support use of the sample selection system estimator over more conventional estimation procedures. Results indicate that household size, location of residence, ethnicity, age, education, and income are closely associated with patterns of household expenditures for fresh, frozen, and processed meats. Several observations are noted regarding determinants of purchase likelihoods and expenditure patterns for meat in Malaysia.
Total Factor Productivity Decomposition and Unobserved Heterogeneity in Stochastic Frontier Models
Authors: Kellermann Magnus A.
Published: September 2016

This study examines in an empirical comparison how different econometric specifications of stochastic frontier models affect the decomposition of total factor productivity growth. We estimate nine stochastic frontier models, which have been widely used in empirical investigations of sources of productivity growth. Our results show that the relative contribution of components to total factor productivity growth is quite sensitive to the choice of econometric model, which points to the need to select the “right” model. We apply various statistical tests to narrow the range of applicable models and identify additional criteria upon which to base the choice of non-nested models.
The Relation Between Farm Production Risk and Off-Farm Income
Authors: Kyle Steven C.
Published: September 2016

This paper presents a model of the farm labor allocation decision based on risk and return characteristics of different activities. It is shown that off-farm employment can play an important role in the diversification of farm family income, implying that portfolio models of risk and return to farm activities should take into account the possibility of off-farm employment. A model of the labor allocation decision based on the risk and return characteristics of each activity is developed and tested using a state level cross section of the United States over the post-war period, and performs well in explaining variation in reliance on off-farm income.
The Economic Feasibility of Poultry Litter Composting Facilities in Eastern West Virginia
Authors: Fritsch David A. , Collins Alan R.
Published: September 2016

Centralized, off-farm compost facilities were evaluated as a disposal option for poultry litter. Disposal fees to growers were required to develop an economically feasible facility for a private investor. The potential for a compost facility to compete with current litter alternatives depends upon development of compost markets comparable to urban areas along with a depressed market price for litter. Given disposal fees and uncertainty associated with market development, further expansion of land application and cattle feeding disposal alternatives is recommended.
The Impact of Domestic and Foreign Macroeconomic Variables on U.S. Meat Exports
Authors: Liu Donald J. , Chung Pin J. , Meyers William H.
Published: September 2016

This paper examines the impact of domestic and foreign macroeconomic variables on U.S. meat exports, including beef, pork, turkey, and chicken, in the context of an open economy. The results show that foreign macroeconomic variables exert more significant and persistent effects on U.S. meat exports than domestic macroeconomic variables. The implication is that the U.S. can increase its meat exports more effectively by expending efforts on international macroeconomic policy coordination rather than on domestic sectoral policy. The results also suggest that macroeconomic models of the agricultural sector should include foreign variables and should not be limited only to domestic ones.
Testing Structural Changes in the U.S. Whitefish Import Market: An Inverse Demand System Approach
Authors: Asche Frank , Zhang Dengjun
Published: September 2016

The seafood market has changed substantially in recent decades, becoming increasingly globalized. This has led to introduction of new species and new sources of fish in most markets. We estimate a seafood demand system that, unlike models in previous studies, accounts for potential structural shifts caused by these market changes. We investigate the impact of tilapia as a new species and China as a new source on demand for imported whitefish in the United States. The results indicate that price flexibilities change substantially over time and that the structural shift takes place over a prolonged period.
Perverse Incentives with Pay for Performance: Cover Crops in the Chesapeake Bay Watershed
Authors: Bosch Darrell J. , Pease James W. , Wieland Robert , Parker Doug
Published: September 2016

Policymakers are concerned about nitrogen and phosphorus export to water bodies. Exports may be reduced by paying farmers to adopt practices to reduce runoff or by paying performance incentives tied to estimated run-off reductions. We evaluate the cost-effectiveness of practice and performance incentives for reducing nitrogen exports. Performance incentives potentially improve farm-level and allocative efficiencies relative to practice incentives. However, the efficiency improvements can be undermined by baseline shifts when growers adopt crops that enhance the performance payments but cause more pollution. Policymakers must carefully specify rules for performance-incentive programs and payments to avoid such baseline shifting.
Consumer Preferences for Peach Attributes: Market Segmentation Analysis and Implications for New Marketing Strategies
Authors: Campbell Benjamin L. , Mhlanga Saneliso , Lesschaeve Isabelle
Published: September 2016

Consumers in today's marketplace have seemingly endless choices with regards to produce. Peach growers and retailers in Ontario, Canada, have begun taking steps to increase demand for their products. This study investigates the impact of those strategies on the market. Using conjoint analysis and market simulations, we evaluate the peach market to identify key drivers of peach purchasing. The results indicate that the market is heterogeneous and that price, origin, and quality indicators are the most important drivers of purchases. Our simulations indicate that adoption of new plastic packaging by the industry is a viable strategy for increasing demand for local peaches.
Supplemental Nutrition Assistance Program Participation and Local Program Outreach and Eligibility Services
Authors: Mabli James
Published: September 2016

Program outreach activities are integral components of social welfare programs, but the relationship between availability of outreach services and households’ program participation has not been examined due to lack of data on outreach efforts. This study uses a unique, nationally representative, matched household-agency data set of more than 21,000 households from 2009 to examine relationships between household participation in the Supplemental Nutrition Assistance Program (SNAP) and outreach and eligibility services offered by local agencies. When agencies provide applications to clients of emergency food pantries and submit their applications to SNAP administrative offices, the probability of household participation in SNAP increases 5–6 percentage points.
Breeding Technologies in U.S. Meat Goat Production: Who are the Adopters and How Does Adoption Impact Productivity?
Authors: Gillespie Jeffrey , Qushim Berdikul , Nyaupane Narayan , McMillin Kenneth
Published: September 2016

Adoption of advanced breeding technologies and management practices (BTMP) in U.S. meat goat production and their impact were examined. Adopters generally had larger-scale operations, used rotational grazing and/or dry lot systems, and sold larger percentages of animals for breeding and show purposes. Farmer demographics and farm variables also influenced adoption. Complementarity of adoption was found—adopters of one BTMP tended to adopt other BTMPs. Measures of productivity and profitability were not affected by adoption. Goat breed, farmer experience, production system used, and specialization influenced productivity, and farm size had the greatest influence on enterprise profitability.
Some Guiding Principles for Empirical Production Research in Agriculture
Authors: Just Richard E.
Published: September 2016

Constraints on production economic research are examined in three dimensions: problem focus, methodology, and data availability. Data availability has played a large role in the choice of problem focus and explains some misdirected focus. A proprosal is made to address the data availability constraint. The greatest self-imposed constraints are methodological. Production economics has focused on flexible representations of technology at the expense of specificity in preferences. Yet some of the major problems faced by decision makers relate to long-term problems, e.g., the commodity boom and ensuing debt crisis of the 1970s and 1980s where standard short-term profit maximization models are unlikely to capture the essence of decision maker concerns.
Trade Liberalization as a Vehicle for Adapting to Global Warming
Authors: Randhir Timothy O. , Hertel Thomas W.
Published: September 2016

This study assesses the potential interaction between climate change and agricultural trade policies. We distinguish between two dimensions of agricultural trade policy: market insulation and subsidy levels. Building on the previous work of Tsigas, Frisvold and Kuhn (1997) we find that, in the presence of current levels of agricultural subsidies, increased price transmission—as called for under the Uruguay Round Agreement on Agriculture—reduces global welfare in the wake of climate change. This is due to the positive correlation between productivity changes and current levels of agricultural support. Increases in subsidized output under climate change tend to exacerbate inefficiencies in the global agricultural economy in the absence of market insulation. However, once agricultural subsidies have also been eliminated, price transmission via the global trading system contributes positively to economic adaptation under climate change.
Risk Analysis of Adopting Zero Runoff Subirrigation Systems in Greenhouse Operations: A Monte Carlo Simulation Approach
Authors: Uva Wen-fei L. , Weiler Thomas C. , Milligan Robert A. , Albright Louis D. , Haith Douglas A.
Published: September 2016

Zero runoff subirrigation (ZRS) technology can effectively manage fertilizer input while improving greenhouse production efficiency. However, high capital investment costs and inadequate technical information to growers are impediments for adoption. A Monte Carlo simulation was used to compare the profitability and risks of alternative ZRS system investments for greenhouse operations in the northeastern and north central United States. Results showed that the Dutch movable tray system and the flood floor system were most profitable and least risky for small potted plant and bedding crop flat production, respectively. The trough bench system was least favorable because its profitability was low and highly volatile.
The Growing Prevalence of Emergency, Disaster, and Other Ad Hoc Farm Program Payments: Implications for Agri-Environmental and Conservation Programs
Authors: Smith Katherine R.
Published: September 2016

The use of emergency, disaster, and other ad hoc sources of income support to American farmers escalated dramatically between 1991 and 2002, increasing year-to-year uncertainty about the magnitude and distribution of farm program benefits. Ad hoc payment mechanisms, while meeting needs now apparently unsatisfied by other farm programs, have the potential to substitute for or conflict with agri-environmental and conservation program goals. Federal budget constraints likely make continued growth in ad hoc payment schemes unsustainable, raising questions about what will take their place. There is ample room for new research on how alternative farm program approaches and program combinations interact to affect stewardship behavior and associated agri-environmental outcomes.
Are Green Payments Good for the Environment?
Authors: Lichtenberg Erik
Published: September 2016

There is growing interest in green payments subsidizing conservation measures on working farmland based on the premise that they have positive effects on the environment and agriculture simultaneously without causing international trade distortions. This paper uses a Ricardian land market equilibrium model to examine the impacts of green payments. The analysis shows green payments can worsen ambient pollution damage by subsidizing the expansion of more intensive crop cultivation. Some forms of green can increase cultivation intensity (and thus environmental damage) as well. These adverse effects can be avoided by careful targeting, but such targeting is likely to be quite difficult.
ITQs and Community: An Essay on Environmental Governance
Authors: McCay Bonnie J.
Published: September 2016

Two important new directions in resource and environmental management are increased reliance on market mechanisms on the one hand, and on greater participation by local communities on the other. In fisheries, market-based management is found mainly in the “cap-and-trade” systems known as individual transferable quotas (ITQs). ITQs are effective in achieving certain economic goals but often with undesirable social costs, leading to the view that they are antithetical to community-based management. However, ITQ systems have been adapted to mitigate community losses. In addition, social resistance to ITQs has encouraged the development of innovative programs in community-based fisheries management.
Socioeconomics of Individual Transferable Quotas and Community-Based Fishery Management
Authors: Copes Parzival , Charles Anthony
Published: September 2016

In many fisheries around the world, the failures of centralized, top-down management have produced a shift toward co-management—collaboration and sharing of decision making between government and stakeholders. This trend has led to a major debate between two very different co-management approaches—community-based fishery management and market-based individual transferable quota management. This paper examines the debate over the relative merits of these models and undertakes a socioeconomic analysis of the two approaches. The paper includes (1) an analysis of differences in the structure, philosophical nature, and underlying value systems of each, including a discussion of their treatment of property rights; (2) a socioeconomic evaluation of the impacts of each system on boat owners, fishers, crew members, other fishery participants, and coastal communities, as well as the distribution of benefits and costs among fishery participants; and (3) examination of indirect economic effects that can occur through impacts on conservation and fishery sustainability. The latter relate to (a) the conservation ethic, (b) the flexibility of management, (c) the avoidance of waste, and (d) the efficiency of enforcement. The paper emphasizes the need for a broader approach to analyzing fishery management options, one that recognizes and properly assesses the diversity of choices, and that takes into account the interaction of the fishery with broader community and regional realities.
Contingent Valuation, Hypothetical Bias, and Experimental Economics
Authors: Murphy James J. , Stevens Thomas H.
Published: September 2016

Although the contingent valuation method has been widely used to value a diverse array of non-market environmental and natural resource commodities, recent empirical evidence suggests it may not accurately estimate real economic values. The hypothetical nature of environmental valuation surveys typically results in responses that are significantly greater than actual payments. Economists have had mixed success in developing techniques designed to control for this “hypothetical bias.” This paper highlights the role of experimental economics in addressing hypothetical bias, and identifies a gap in the existing literature by focusing on the underlying causes of this bias. Most of the calibration techniques used today lack a theoretical justification, and therefore these procedures need to be used with caution. We argue that future experimental research should investigate the reasons hypothetical bias persists. A better understanding of the causes should enhance the effectiveness of calibration techniques.
A Note on the Reliability Tests of Estimates from ARMS Data
Authors: Kim C. S. , Hallahan C. , Lindamood W. , Schaible G. , Payne J.
Published: September 2016

USDA uses the concept of “publish-ability” rather than statistical reliability of an estimate for quality validation of USDA estimates, which is solely based on the sample size and the coefficient of variation (CV). We demonstrate conceptually how the reliability of the sample mean can be tested by estimating the upper and lower bounds of the confidence interval for an unknown population mean using the CV. However, the reliability test for the sample mean can be made only under the normality assumption. USDA multiple-way Agricultural Resource Management Survey (ARMS) estimates are used to illustrate the relative measure of precision for sample-based estimators.
The 21st Century Land Grant Economist
Authors: Adelaja Adesoji O.
Published: September 2016

The land grant system is a value-added infrastructure, designed to extend the boundaries of traditional colleges and universities to bring science to bear on the pressing needs and problems of underserved citizens and communities. With supplemental resources to support mission-oriented research and outreach, the system has addressed a market failure in higher education. It has been a key asset in achieving for the United States a vibrant agricultural economy, a prominent position in world trade, significant rural development, healthy families and communities, and the increasingly sustainable natural resource base that are characteristic of “the great American Society.” This paper explores some of the recent challenges facing the land grant system, provides a framework for examining these challenges, and stresses the need for a new cadre of “land grant economists” to provide leadership as land grants struggle to identify new visions, missions, programs, and innovations that would serve as the bedrock of a new system. Selected areas of emerging opportunities for land grant intervention are also identified.
Setting the Standard for Farmland Preservation: Do Preservation Criteria Motivate Citizen Support for Farmland Preservation?
Authors: Deaton B. James , Norris Patricia E. , Hoehn John P.
Published: September 2016

The multifunctional set of services provided by farmland complicates the task of identifying which farmland should be preserved. For this reason many states and local governments establish criteria to rank and select parcels of farmland for protection. This study examines whether criteria commonly used by state programs to guide purchases of agricultural conservation easements influence public demand for farmland preservation. The results provide policy makers with additional information to assess current ranking criteria that set the standard for farmland preservation.
The Economics of Labeling: An Overview of Issues for Health and Environmental Disclosure
Authors: Teisl Mario F. , Roe Brian
Published: September 2016

During the last two decades, product labeling has become an increasingly used policy tool, particularly with respect to the provision of health and environmental information. Theory holds that the flow of information among market participants plays a critical role in the efficient operation of markets. This paper explores the role of product labeling policy in ameliorating two potential market deficiencies: asymmetric information and costly search behavior. Practical considerations for the design and implementation of labeling policy and of labeling research are explored.
Marginal Abatement Costs of Reducing Groundwater-N Pollution with Intensive and Extensive Farm Management Choices
Authors: Yiridoe Emmanuel K. , Weersink Alfons
Published: September 2016

Cost-effectiveness is an important consideration in evaluating choices for meeting environmental quality objectives. Estimated crop yield response functions and the associated groundwater-nitrate pollution production functions were used to evaluate the optimal N fertilization and on-farm abatement costs for alternative cropping systems, with management choices at both the intensive and extensive margins. The cost-effective corn production system, which meets the Health Canada standard for nitrates with the highest returns ($278 ha–1) and lowest on-farm abatement cost ($248 ha–1), was a four-year corn-corn-soybean-wheat rotation under conventional tillage. At contaminant limits above the Health Canada standard, the cost-effective wheat cropping system shifted from a soybean-wheat rotation under no-tillage to a corn-soybean-wheat rotation under no-tillage.
Modeling Fresh Tomato Marketing Margins: Econometrics and Neural Networks
Authors: Richards Timothy J. , Patterson Paul M. , Ispelen Pieter Van
Published: September 2016

This study compares two methods of estimating a reduced form model of fresh tomato marketing margins: an econometric and an artificial neural network (ANN) approach. Model performance is evaluated by comparing out-of-sample forecasts for the period of January 1992 to December 1994. Parameter estimates using the econometric model fail to reject a dynamic, imperfectly competitive, uncertain relative price spread margin specification, but misspecification tests reject both linearity and log-linearity. This nonlinearity suggests that an inherently nonlinear method, such as a neural network, may be of some value. The neural network is able to forecast with approximately half the mean square error of the econometric model, but both are equally adept at predicting turning points in the time series.
Stochastic Dominance Analysis of Futures and Option Strategies for Hedging Feeder Cattle
Authors: Harrison R. Wes
Published: September 2016

Stochastic simulation and generalized stochastic dominance are used to compare the risk-return properties of the Chicago Mercantile Exchange feeder cattle futures contract with those of the feeder cattle put option contract. Cash marketing, futures, and option strategies are analyzed for four backgrounding systems common to the mid-south region of the United States. The results show that at-the-money put option strategies dominate corresponding futures contract strategies according to generalized stochastic dominance. This implies that at-the-money put option contracts are superior to feeder cattle futures contracts for risk-averse backgrounders in the mid-south region of the United States.
Food Retailers' Pricing and Marketing Strategies, with Implications for Producers
Authors: Li Lan , Sexton Richard J. , Xia Tian
Published: September 2016

This paper examines grocery retailers' ability to influence prices charged to consumers and paid to suppliers. We discuss how retailer market power manifests itself in terms of pricing and marketing strategies by setting forth and offering evidence in support of eight “stylized facts” of retailer pricing and brand decisions. We argue that little, if any, of this behavior can be explained by a model of a competitive, price-taking retailer, but that most of the indicated behavior was also inconsistent with traditional models of market power. Finally, we discuss the impacts of aspects of this retailer behavior on the upstream farm sector.
Pricing and Policy Problems in the Northeast Fluid Milk Industry
Authors: Cotterill Ronald W.
Published: September 2016

This article documents the need for reform of milk pricing in the Northeast. The New York price gouging law can be recast as a fair share law. This new milk policy “kills two birds with one stone.” It corrects regional inequities in raw milk pricing by reforming the pricing of milk at retail by limiting and redistributing excessive retail margins to farmers and consumers. The fair share policy relieves allocative price inefficiency, improves the performance of the federal milk market order pool, and improves the general performance of the Northeast dairy farming and fluid milk industries.
Farm Wealth Inequality Within and Across States in the United States
Authors: Mishra Ashok K. , Moss Charles B. , Erickson Kenneth W.
Published: September 2016

This paper uses Theil's (1979) entropy-based measure of inequality and farm-level data to examine changes in farm business wealth (farm equity) of farm households. The farms associated with farm households are grouped by state into ten regions of the United States. The Theil entropy measure is then calculated and used to decompose total inequality of farm wealth into within-state and across-states (between states) inequalities for each region. Results show that since the enactment of the 1996 Federal Agricultural Improvement and Reform (FAIR) Act, inequality in farm wealth among farms within a state has decreased relative to the number of farms per state, across all regions. Further, most of the reduction in farm wealth inequality is attributed to increased equality in the distribution of real estate assets of the farm households, a major component of farm wealth.
Price Dynamics in the North American Wheat Market
Authors: Baek Jungho , Koo Won W.
Published: September 2016

Perron's test, Johansen cointegration analysis, and a vector error-correction (VEC) model are used to identify structural change, as well as to examine price dynamics in the U. S. and Canadian hard red spring (HRS) and durum wheat markets. It is found that, due to the U. S. Export Enhancement Program (EEP), price instability experienced in June 1986 has resulted in structural changes for Canadian HRS and durum prices. We also find that Canadian prices have significant effects on the determination of the U. S. prices in the North American wheat market.
Import Demand for Quality in the Japanese Beef Market
Authors: Miljkovic Dragan , Jin Hyun
Published: September 2016

The case of reduction in ad valorem tariffs as a trade liberalization policy is considered in this article. It is shown that the reduction leads to a higher quality of imports, ceteris paribus. This hypothesis was tested on the case of Japanese beef imports from the United States and Australia. U. S. beef, according to the results of Gallup surveys, is considered by Japanese consumers to be a high quality product, while Australian beef is considered to be a low quality product. Empirical results support the hypothesis. Moreover, the recent domination of U. S. beef in the Japanese market is further explained by increasingly more efficient U. S. beef production relative to Australian production and a strong income effect, where an increase in per capita income leads to more demand for higher quality products.