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  • Articles  (49)
  • Food Policy  (36)
  • Q15 - Land Ownership and Tenure  (14)
  • Geodynamics and Tectonics
  • Oxford University Press  (49)
  • American Journal of Agricultural Economics  (49)
  • 129545
  • 1
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    Following Up on Smallholder Farmers and Supermarkets in Kenya (2015)
    Oxford University Press
    Details
    Publication Date: 2015-07-10
    Description: In many developing countries, supermarkets are expanding rapidly. This affects farmers’ marketing options. Previous studies have analyzed welfare effects of smallholder participation in supermarket channels from a static perspective, using cross-section data. We develop a conceptual framework and use panel data to better understand participation and impact dynamics. The analysis focuses on vegetable producers in Kenya. Participation in supermarket channels is associated with income gains. However, many farmers have dropped out of the supermarket channel due to various constraints. The initial income gains cannot be sustained when returning to the traditional market. Organizational support may be needed to avoid widening income disparities.
    Keywords: L24 - Contracting Out ; Joint Ventures ; Technology Licensing, O12 - Microeconomic Analyses of Economic Development, O13 - Agriculture ; Natural Resources ; Energy ; Environment ; Other Primary Products, Q12 - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets, Q13 - Agricultural Markets and Marketing ; Cooperatives ; Agribusiness, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
    Published by Oxford University Press
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  • 2
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    Who Really Benefits from Agricultural Subsidies? Evidence from Field-level Data (2016)
    Oxford University Press
    Details
    Publication Date: 2016-07-09
    Description: If agricultural subsidies are largely capitalized into farmland values through their effect on rental rates, then expanding support for agriculture may not benefit farmers who rent the land they farm. Existing evidence on the incidence of subsidies on cash rental rates is mixed. Identification is obscured by unobserved or imprecisely measured factors that tend to be correlated with subsidies, especially land quality and time-varying factors like commodity prices and adverse weather events. A problem that has received less attention is the fact that subsidies and land quality on rented land may differ from owned land. Since most farms possess both rented and owned acreage, farm-level measures of subsidies, land values, and rental rates may bias estimated incidence. Using a new, field-level data set that, for the first time, precisely links subsidies to land parcels, we show that this bias is considerable: where farm-level estimates suggest an incidence of 42–49 cents of the marginal subsidy dollar, field-level estimates from the same farms indicate that landlords capture just 20–28 cents. The size of the farm and the duration of the rental arrangement have substantial effects. Incidence falls by 5–15 cents when doubling total operated acres, and the incidence falls by 0.1–0.8 cents with each additional year of the rental arrangement. Low incidence of subsidies on rents combined with the farm-size and duration effects suggest that farmers renting land have monopsony power.
    Keywords: H22 - Incidence, Q14 - Agricultural Finance, Q15 - Land Ownership and Tenure ; Land Reform ; Land Use ; Irrigation, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
    Published by Oxford University Press
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  • 3
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    Trade Policy Coordination and Food Price Volatility (2016)
    Oxford University Press
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    Publication Date: 2016-07-09
    Description: Many countries adjust their trade policies counter-cyclically with food prices, to the extent that the use of restrictions by food-exporting countries has occasionally threatened the food security of food-importing countries. These trade policies are inconsistent with the terms-of-trade motivation often retained to characterize the payoff frontier of self-enforcing trade agreements, as they can worsen the terms of trade of the countries that apply them. This article analyzes trade policy coordination when trade policies are driven by terms-of-trade effects and a desire to reduce domestic food price volatility. This framework implies that importing and exporting countries have incentives to deviate from cooperation at different periods: the latter when prices are high and the former when prices are low. Since staple food prices tend to have asymmetric distributions, with more prices below than above the mean but with occasional spikes, a self-enforcing agreement generates asymmetric outcomes. Without cooperation, an importing country uses its trade policy more frequently because of the concentration of prices below the mean, but an exporting country has a greater incentive to deviate from a cooperative trade policy because positive deviations from the mean price are larger than negative ones. Thus, the asymmetry of the distribution of commodity prices can make it more difficult to discipline export taxes than tariffs in trade agreements.
    Keywords: F13 - Trade Policy ; International Trade Organizations, Q17 - Agriculture in International Trade, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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  • 4
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    Interactions between CAP Agricultural and Agri-Environmental Subsidies and Their Effects on the Uptake of Organic Farming (2016)
    Oxford University Press
    Details
    Publication Date: 2016-07-09
    Description: We analyze the effects of the interactions that the two pillars of the European Union Common Agricultural Policy—market support and rural development—have on farmers’ uptake of organic farming practices. Special attention is given to the 2003 reform, which substantially altered the relative importance of the two types of support by decoupling direct agricultural payments from the production of a specific crop. In our empirical analysis we study the case of Sweden, making use of the variation in the timing of farmers’ decisions regarding participation in support programs. We estimate a dynamic non-linear unobserved effects probit model to account for unobserved individual heterogeneity and state dependence. Our results indicate the existence of a negative effect of the market support system in place when organic farming techniques were adopted before the 2003 reform. However, this effect is reversed by the introduction of decoupling. Furthermore, the effects of support differ between certified and non-certified organic production: both pillars have significant effects on non-certified organic farming, whereas certified organic farming is exclusively driven by agro-environmental subsidies.
    Keywords: C23 - Models with Panel Data, Q12 - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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  • 5
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    The Yield of Plant Variety Protection (2015)
    Oxford University Press
    Details
    Publication Date: 2015-04-18
    Description: The prospects for plant variety protection to deliver improved varieties of self-pollinating crops is assessed using the experience of the Australian wheat breeding sector as a natural experiment. The analysis is based on detailed new data on the agronomic performance of all wheat varieties released by Australian breeders between 1976 and 2011. The results indicate that plant variety protection, and associated reforms, led to a substantial fall in breeder output. Qualitative evidence indicates that this was caused by a combination of fewer research spillovers, lower release standards, and a possible fall in total investment in breeding.
    Keywords: O34 - Intellectual Property Rights, Q16 - R&D ; Agricultural Technology ; Agricultural Extension Services, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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  • 6
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    A Triple-Hurdle Model of Production and Market Participation in Kenya's Dairy Market (2015)
    Oxford University Press
    Details
    Publication Date: 2015-07-10
    Description: Existing analyses of market participation are based on a "double-hurdle" modeling approach. Such models are appropriate only when all members of the population of interest actually produce the good. In some contexts, however (e.g., smallholder farmers), many members of the population do not produce particular goods that they could produce and that their neighbors do produce. Policies influencing market participation among producers may thus also induce additional farmers to become producers. Previous double-hurdle approaches do not allow explicitly for this possibility. To address these limitations, this article presents a "triple-hurdle" approach with an initial stage that includes nonproducers. The model is used to identify the factors associated with Kenyan smallholder farmers choosing to participate in dairy production, and the role that these producers choose to play (or not) in the marketplace. In the midst of debates underway over the privatization of the parastatal Kenya Creameries Company, new knowledge about smallholder participation in dairy could be an important contribution. Results suggest the importance of rural electrification, training, and improved grazing practices. We find that expected net sales are significantly higher when farmers have access to informal private markets. We also describe a version of the ordered tobit model that includes nonproducers and is nested in our triple-hurdle model. A likelihood ratio test shows the latter to be a significantly better fit to our data. We discuss how insights gained from this study differ from the insights that would come from a double-hurdle ordered tobit that also includes nonproducers.
    Keywords: C51 - Model Construction and Estimation, C81 - Methodology for Collecting, Estimating, and Organizing Microeconomic Data, O12 - Microeconomic Analyses of Economic Development, Q13 - Agricultural Markets and Marketing ; Cooperatives ; Agribusiness, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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  • 7
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    The Political Economy of Food Price Volatility: The Case of Vietnam and Rice (2015)
    Oxford University Press
    Details
    Publication Date: 2015-07-10
    Description: This article argues that the structure of the Vietnamese rice export system is, in political economy terms, a rational response to the volatility present in the international rice market. In particular, it is argued that the Vietnamese Food Agency, along with VINAFOOD-1 and VINAFOOD-2, have been structured so that they can benefit from the domestic demands for export restrictions anticipated to occur as a consequence of international price volatility and the psychological demand of consumers for price stability. In turn, the actions of these agencies also contribute to international price volatility and the resulting demand for export restrictions. Since the political and economic elite in Vietnam obtain both political and economic power from this system, it is unlikely to be replaced with more effective and efficient policies to combat domestic price volatility. Thus, continued volatility in the price of rice can be expected.
    Keywords: N55 - Asia including Middle East, P26 - Political Economy ; Property Rights, Q17 - Agriculture in International Trade, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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  • 8
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    What Happens When Food Marketers Require Restrictive Farming Practices? (2015)
    Oxford University Press
    Details
    Publication Date: 2015-07-10
    Description: The dimensions that define a food product have expanded rapidly to include characteristics of the production process, marketing arrangements, and implications that production and consumption of the product have for the environment. Some market intermediaries have responded by requiring that their suppliers abide by restrictive production practices. We examine the economic effects of such restrictions and apply this analysis to limitations on the use of antibiotics in U.S. pork production. Results from conceptual and simulation analyses show that, in the absence of demand growth, less pork is sold due to higher costs in the restricted segment, and both pork consumers (on average) and producers are harmed. Demand growth of between 6–11% from adding new consumers who will consume the restricted (antibiotic-free) product but not the conventional product is needed to return consumer surplus to the level in the base case, and between 2–4% demand growth was required to return producer surplus to base. When restricted and conventional products are modeled using a vertical differentiation framework, results depend importantly on the ease with which consumers can switch to a seller who offers their desired product type. Significant distributional impacts among consumers are present when switching costs are prohibitive.
    Keywords: I18 - Government Policy ; Regulation ; Public Health, Q13 - Agricultural Markets and Marketing ; Cooperatives ; Agribusiness, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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  • 9
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    Asia-Pacific Integration with China versus the United States: Examining Trade Patterns under Heterogeneous Agricultural Sectors (2015)
    Oxford University Press
    Details
    Publication Date: 2015-09-12
    Description: This article examines bilateral trade patterns in the Asia-Pacific using a new model in which comparative advantage within the agricultural sector is linked to agro-ecological characteristics, and trade costs are product-specific. Bilateral market share is a function of productivity and trade costs. However, countries with similar land and climate characteristics systematically have high productivity in similar products making them disproportionately sensitive to changes in each other's trade costs. We use a random coefficients logit model to estimate a parametric distribution of comparative advantage and trade costs across products and calculate regional trade liberalization elasticities for each exporter in each import market. Unlike most existing models, the value of the elasticity depends on the degree to which liberalization includes competitors with similar comparative advantage within the agricultural sector. We find disproportionately larger trade elasticities under China-led liberalization relative to U.S.-led liberalization among close U.S. competitors compared to countries whose agricultural products are unlikely to compete head-to-head with U.S. exports. For the United States, we find that the "lost opportunity" cost of exclusion from regional liberalization is increasing in the extent to which its close competitors gain new access.
    Keywords: F13 - Trade Policy ; International Trade Organizations, F14 - Country and Industry Studies of Trade, F15 - Economic Integration, Q17 - Agriculture in International Trade, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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  • 10
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    Marketing Contracts and Crop Insurance (2015)
    Oxford University Press
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    Publication Date: 2015-09-12
    Description: Contracts between farmers and intermediaries and crop insurers are important means for farmers to mitigate risks in modern U.S. agriculture. In this paper, we investigate the effect of crop insurance enrollment on contract terms and farmers’ participation in marketing contracts. Following Ligon (2003) , we set up a mechanism design framework to demonstrate an intermediary's contract design problem, where farmers are assumed to be utility maximizing agents. We depict farmers’ optimal choices of insurance coverage using the specification developed by Babcock (2012) . Our model shows that improved terms of crop insurance (lower premiums, higher subsidies) make contracts less appealing to farmers as mechanisms for mitigating risk. Therefore, intermediaries may revise their contract offers so that they are more attractive. However, improvements in contract terms are limited by their cost to the intermediaries and will not lead to expanded participation in contracts.
    Keywords: Q12 - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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  • 11
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    The Effect of Food Deserts on the Body Mass Index of Elementary Schoolchildren (2015)
    Oxford University Press
    Details
    Publication Date: 2015-12-13
    Description: Families in low-income neighborhoods sometimes lack access to supermarkets that provide a broad range of healthy foods. We investigate whether these so called "food deserts" play a role in childhood obesity using a statewide panel data set of Arkansas elementary schoolchildren. We use fixed-effects panel data regression models to estimate the average food desert effect. We next compare children who left (entered) food deserts to children who were always (never) in food deserts and homogenize samples for those whose food desert status changed as a result of a change in residence and those whose status changed only as a consequence of the entry or exit of a supermarket. We present evidence that exposure to food deserts is associated with higher z-scores for body mass index. On average, this is in the neighborhood of 0.04 standard deviations. The strongest evidence and largest association is among urban students and especially those that transition into food deserts from non-deserts. Our food desert estimates are similar in magnitude to findings reported in earlier work on diet and lifestyle interventions targeting similarly aged schoolchildren. That said, we are unable to conclude that the estimated food desert effect is causal because many of the transitions into or out of food deserts result from a change in residence, an event that is endogenous to the child's household. However, there is evidence that food deserts are a risk indicator and that food desert areas may be obesogenic in ways that other low-income neighborhoods are not.
    Keywords: I14 - Health and Inequality, I19 - Other, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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  • 12
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    Spatial Pattern of Yield Distributions: Implications for Crop Insurance (2014)
    Oxford University Press
    Details
    Publication Date: 2014-01-22
    Description: Crop insurance is similar to flood and hurricane insurance in that spatially correlated weather tends to cause violations of the independence assumption. Ideally, one would seek to pool uncorrelated risk drawn from the same distribution in crop insurance. This article proposes a testing procedure for the cross-sectional pooling of group units, and empirically analyzes whether the proposed test improves out-of-sample rating performance. We utilize a balanced panel of U.S. county-level corn yields for 510 counties, and the results of an out-of-sample crop insurance rating performance exercise provide economic significance to the proposed pooling methodology and results.
    Keywords: C12 - Hypothesis Testing, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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  • 13
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    Input Subsidies, Cash Constraints, and Timing of Input Supply (2014)
    Oxford University Press
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    Publication Date: 2014-01-22
    Description: Is low input use by poor, smallholder farmers caused by time-inconsistent behavior or by limited ability to buy inputs? Are input subsidies the best solution to stimulate input demand or are there smarter solutions? These issues are investigated by combining survey data, stated preference questions, and randomized experiments in Malawi. The demand for fertilizer at harvest time and at planting time, farm gate shadow prices for fertilizer, and the gap between the willingness-to-accept (WTA) and willingness-to-pay (WTP) prices for a standard input package were investigated. Significant effects of timing and of cash constraints were found, suggesting the possibility that smarter designs exist, such as distribution of smaller packages from harvest time to planting time.
    Keywords: Q12 - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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  • 14
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    A Natural Resource Theory of U.S. Crop Insurance Contract Choice (2014)
    Oxford University Press
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    Publication Date: 2014-01-22
    Description: A large variety of subsidized crop insurance products are available to U.S. crop growers. Distinct and perhaps puzzling patterns in the choices of insurance products and coverage levels can be discerned. Where production conditions are better and yields are less risky then ( a ) higher insurance coverage levels are chosen; and ( b ) revenue insurance is preferred over yield insurance. Also, ( c ) the extent of preference for revenue insurance is stronger in more productive areas. Assuming, as many do, that growers seek to maximize subsidy transfers, point ( a ) can be explained by the interaction between yield technology and natural resource endowments. Points ( b ) and ( c ) can be explained by location in conjunction with the "natural hedge" and a contract design bias in how revenue insurance guarantees are computed. Empirical study of Risk Management Agency data on corn, soybean, and wheat yields, and insurance contract choices lend support to our model inferences.
    Keywords: Q15 - Land Ownership and Tenure ; Land Reform ; Land Use ; Irrigation, Q18 - Agricultural Policy ; Food Policy, Q24 - Land
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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  • 15
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    Angel Investment and Collective Agricultural Marketing: The Case of the Minnesota Food Network (2014)
    Oxford University Press
    Details
    Publication Date: 2014-03-21
    Description: The Minnesota Food Network is a limited liability company comprised of 52 farmers producing a variety of high-quality, sustainably produced agricultural products in southern Minnesota. The network's goal is to develop a regional food system to provide locally grown food at a price that "is fair" to both consumers and producers. This case outlines the challenges that the network faces in their efforts to expand to take advantage of a market opportunity. One of their biggest challenges is that they face high operating costs because of their disaggregated distribution system and need to purchase a distribution and storage facility and two vehicles. They will fund the purchase of a building through an angel investor. An angel investor is necessary because the network cannot sustain traditional loan payments in its current form. Students are asked to consider a number of questions pertaining to the decisions in this case outlined in the final section of the case study.
    Keywords: A22 - Undergraduate, Q13 - Agricultural Markets and Marketing ; Cooperatives ; Agribusiness, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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  • 16
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    Portfolio Speculation and Commodity Price Volatility in a Stochastic Storage Model (2014)
    Oxford University Press
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    Publication Date: 2014-03-21
    Description: Simulated prices from a stochastic storage model are used to examine the price impacts of speculation by rational investors who diversify their financial portfolios by holding agricultural commodity futures. The main result is that rather than destabilizing commodity prices, as is commonly believed, portfolio speculation actually reduces price volatility. Portfolio speculation can potentially destabilize a commodity's price because the additional demand for long futures by speculators is expected to drive up the cash price during both periods of low net demand, when the cash price is below average, and periods of high net demand, when the cash price is above average. Our theoretical analysis demonstrates that the higher level of inventory that is associated with portfolio speculation results in a larger release of stocks during periods of high net demand. The price simulations reveal that this stock adjustment effect is strong since overall price volatility is smaller rather than larger with portfolio speculation.
    Keywords: Q11 - Aggregate Supply and Demand Analysis ; Prices, Q14 - Agricultural Finance, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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  • 17
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    Capitalized Costs of Habitat Conservation Easements (2014)
    Oxford University Press
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    Publication Date: 2014-04-05
    Description: Perpetual conservation easements permanently remove the option to convert existing habitat to more intensive agricultural production. If existing habitat is at threat of conversion, removing the option to convert will reduce land values. In this article, we estimate the land value discount resulting from perpetual habitat conservation easements by using propensity score matching. We find that on the average eased parcel, land values fall by approximately $86 per acre for every acre of eased habitat. On average, our results suggest that landowners have been adequately compensated and conservation agencies have successfully secured habitat at risk of conversion.
    Keywords: Q15 - Land Ownership and Tenure ; Land Reform ; Land Use ; Irrigation, Q24 - Land, Q57 - Ecological Economics: Ecosystem Services ; Biodiversity Conservation ; Bioeconomics
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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  • 18
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    Agri-environmental Policy and Urban Development Patterns: A General Equilibrium Analysis (2014)
    Oxford University Press
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    Publication Date: 2014-04-05
    Description: This paper investigates the spatial effects that the provision of environmental public goods have on residential location choices in a suburban context. Specifically, a spatial general equilibrium framework is developed to analyze the consequences of adopting an agri-environmental policy promoting the provision of positive farming externalities. We use a static monocentric model of an open city where agricultural bid-rents and agricultural amenities vary endogenously in space, and where the positive externalities associated with agricultural production are valued by households. Consistent with empirical evidence of the potential side effects that conservation policies may have in terms of urbanization patterns and land price changes, we show that under certain conditions implementing an agri-environmental policy may promote additional suburban development. Moreover, we demonstrate that the emergence of disconnected suburban areas may be significantly influenced by the location of land regulated by an agri-environmental policy. Finally, we discuss distributional aspects and show that while introducing an agri-environmental policy has a negative impact on most residential land value, it can have positive effects on farmland and residential land located within the regulated areas, suggesting the non-neutrality of such policies regarding the agents’ assets.
    Keywords: Q15 - Land Ownership and Tenure ; Land Reform ; Land Use ; Irrigation, Q18 - Agricultural Policy ; Food Policy, R13 - General Equilibrium and Welfare Economic Analysis of Regional Economies, R14 - Land Use Patterns, R21 - Housing Demand
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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  • 19
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    Relative Preferences for Soil Conservation Incentives among Smallholder Farmers: Evidence from Malawi (2014)
    Oxford University Press
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    Publication Date: 2014-04-05
    Description: This paper uses framed choice experiments to examine the preferences of smallholder farmers in Malawi regarding alternative policy-based incentives to adopt conservation practices that reduce soil erosion and increase yields. The policy incentives offered in the choice experiments included an ideal index-based crop insurance contract, an index insurance contract with basis risk, cash payments, and fertilizer subsidies. Prior to implementing the choice experiments, the farmers participated in a workshop utilizing small group-based dynamic learning games that demonstrated how index-based crop insurance contracts function. The choice experiment results indicate that most farmers preferred cash payments to index insurance contracts, even when the insurance contracts offered substantially higher expected returns. Further, more risk averse farmers were more likely to prefer cash payments than less risk averse and risk loving farmers.
    Keywords: C93 - Field Experiments, O12 - Microeconomic Analyses of Economic Development, O13 - Agriculture ; Natural Resources ; Energy ; Environment ; Other Primary Products, Q18 - Agricultural Policy ; Food Policy
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    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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  • 20
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    Agricultural Rodent Control Using Barn Owls: Is It Profitable? (2014)
    Oxford University Press
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    Publication Date: 2014-04-05
    Description: We develop a model to evaluate the profitability of controlling rodent damage by placing barn owl nesting boxes in agricultural areas. The model incorporates the spatial patterns of barn owl predation pressure on rodents, and the impact of this predation pressure on nesting choices and agricultural output. We apply the model to data collected in Israel and find the installation of nesting boxes profitable. While this finding indicates that economic policy instruments to enhance the adoption of this biological control method are redundant, it does support stricter regulations on rodent control using rodenticides.
    Keywords: Q15 - Land Ownership and Tenure ; Land Reform ; Land Use ; Irrigation, Q18 - Agricultural Policy ; Food Policy, Q57 - Ecological Economics: Ecosystem Services ; Biodiversity Conservation ; Bioeconomics
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    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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  • 21
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    The Effects of Policy Expectations on Crop Supply, with an Application to Base Updating (2014)
    Oxford University Press
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    Publication Date: 2014-04-05
    Description: We develop a dynamic model to assess the effects of policy expectations on crop supply and illustrate the approach with estimates of the effects of base updating in U.S. crop programs. For corn and soybeans in the Corn Belt, the effect of base updating is relatively small because relevant crop alternatives are subject to similar policies and the alternatives are substitutes in production. Increasing acreage of one program crop to capture future payments from base updating reduces future payments from the alternative crop. We also use our model to assess the effect of base updating on acreage response to prices.
    Keywords: Q18 - Agricultural Policy ; Food Policy
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    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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  • 22
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    Sub-therapeutic Antibiotics and the Efficiency of U.S. Hog Farms (2014)
    Oxford University Press
    Details
    Publication Date: 2014-04-05
    Description: A substantial share of U.S. hog producers incorporate antimicrobial drugs into their livestock's feed or water at sub-therapeutic levels to promote feed efficiency and weight gain. Recently, in response to concerns that the overuse of antibiotics in livestock could promote the development of antimicrobial drug-resistant bacteria, the U.S. Food and Drug Administration adopted a strategy to phase out the use of antibiotics for production purposes. This study uses a stochastic frontier model and data from the 2009 USDA Agricultural Resource Management Survey of feeder-to-finish hog producers to estimate the potential effects on hog output and output variability resulting from a ban on antibiotics used for growth promotion. We use propensity score nearest neighbor matching to create a balanced sample of sub-therapeutic antibiotic (STA) users and nonusers. We estimate the frontier model for the pooled sample and separately for users and non-users—which allows for a flexible interaction between STA use and the production technology. Point estimates for the matched sample indicate that STA use has a small positive effect on productivity and production risk, increasing output by 1.0–1.3% and reducing the standard deviation of unexplained output by 1.4%. The results indicate that improvements in productivity resulted exclusively from technological improvement rather than from an increase in technical efficiency.
    Keywords: D24 - Production ; Cost ; Capital and Total Factor Productivity ; Capacity, I18 - Government Policy ; Regulation ; Public Health, Q12 - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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    Individual and Cooperative Management of Invasive Species in Human-mediated Landscapes (2014)
    Oxford University Press
    Details
    Publication Date: 2014-12-13
    Description: As a bioinvasion spreads across a landscape from its point of introduction, damages rise roughly with the square of the distance from the original invasion. It is thus generally beneficial, at the landscape scale, to apply eradication or containment controls early if not immediately upon discovery. However, an individual property owner only has incentives to consider the costs and benefits of control on his/her own property rather than potential landscape-scale damages. Bioinvasions will therefore generally be under-controlled in a landscape of independent owners operating under a laissez-faire system. A mechanism is thus needed to induce early cooperative contributions to control costs from beneficiaries who would, without them, be invaded later. We develop a spatially-explicit, integrated model of invasion spread and human behavior to examine how different degrees of spatial cooperation affect patterns of invasion spread and the total costs and damages imposed. We compare individual laissez-faire, cooperative control by adjacent neighbors, and cooperative control by groups including more distant but nearby neighbors. As expected, private laissez-faire control decisions tend to under-control the invasion relative to socially optimal control under most circumstances. But a reasonably high fraction of first best payoffs can be achieved with only a modest geographical reach of cooperation. We also find that less extensive cooperation is needed to control invasions whose costs and damages otherwise lead to the largest externalities (circumstances with costs that are relatively low compared with damages). This suggests that even small amounts of cooperation to control bioinvasions can provide large social benefits.
    Keywords: Q15 - Land Ownership and Tenure ; Land Reform ; Land Use ; Irrigation, Q24 - Land, Q57 - Ecological Economics: Ecosystem Services ; Biodiversity Conservation ; Bioeconomics
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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    On the Economics of Labels: How Their Introduction Affects the Functioning of Markets and the Welfare of All Participants (2014)
    Oxford University Press
    Details
    Publication Date: 2014-12-13
    Description: Are labels good or bad for consumers and firms? The answer may seem straightforward since labels improve information, yet economic theory reveals situations where their introduction reduces the welfare of at least some market participants. This essay reviews the theoretical literature on labels in order to identify and explain the main reasons that may cause labeling to produce undesirable side-effects. In contrast to earlier reviews that either concentrate on narrow topics or treat the subject in a more or less informal way, we bring together the main results from all the relevant topics by presenting and discussing the assumptions and model-building techniques that underpin them. The advantage of this approach is that it identifies the origin of the differences between results, thus allowing the synthesis of results that sometimes appear even to be contradictory. We focus on "quality labels" and examine the impact of labeling on market structure, the side-effects of costly certification, issues related to the label's trustworthiness, the rationale for mandatory vs. voluntary labeling, the level at which the label's standard is set according to the agency that selects it, the political economy of labels, that is, pro- or anti-label lobbying, lobbying to affect the label's standard, and lobbying in favor or against the label's mandatory imposition. These topics cover a wide range of applications, including Genetically Modified Organism (GMOs), organic produce, geographic indicators, controlled origin, eco-labels, etc. We conclude by identifying topics that require further research.
    Keywords: L15 - Information and Product Quality ; Standardization and Compatibility, L50 - General, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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    Rising Food Prices, Food Price Volatility, and Social Unrest (2014)
    Oxford University Press
    Details
    Publication Date: 2014-12-13
    Description: Can food prices cause social unrest? Throughout history, riots have frequently broken out, ostensibly as a consequence of high food prices. Using monthly data at the international level, this article studies the impact of food prices – food price levels as well as food price volatility – on social unrest. Because food prices and social unrest are jointly determined, data on natural disasters are used to identify the causal relationship flowing from food price levels to social unrest. Results indicate that for the period 1990–2011, food price increases have led to increases in social unrest, whereas food price volatility has not been associated with increases in social unrest. These results are robust to alternative definitions of social unrest, to using real or nominal prices, to using commodity-specific price indices instead of aggregated price indices, to alternative definitions of the instrumental variable, to alternative definitions of volatility, and to controlling for non-food-related social unrest.
    Keywords: D74 - Conflict ; Conflict Resolution ; Alliances, Q11 - Aggregate Supply and Demand Analysis ; Prices, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
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    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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    Farmland Protection and Agricultural Land Values at the Urban-Rural Fringe: British Columbia's Agricultural Land Reserve (2014)
    Oxford University Press
    Details
    Publication Date: 2014-12-13
    Description: Farmland conservation policies typically use zoning and differentiated taxes to prevent urban development of farmland, but little is known about the effectiveness of these policies. This study adds to current knowledge by examining the impact of British Columbia's Agricultural Land Reserve (ALR), established in 1973, which severely restricts subdivision and nonagricultural uses for more than 4.7 million hectares of farmland. To determine the extent to which the ALR preserves farmland by reducing or removing the development option, a multilevel hedonic pricing model is used to estimate the impact of land use, geographic, and zoning characteristics on farmland value near the capital city of Victoria on Vancouver Island. Using sales data from 1974 through 2008, the model demonstrates a changing ALR impact over time that varies considerably by improved and unimproved land types. In 2008, landowners paid 19% less for the typical improved farmland parcel within the ALR versus that outside it. This suggests that would-be developers expect permanency in the zoning law, and prefer non-ALR zoned land. However, ALR land that is unimproved has a premium of 55%, suggesting that this land is more valuable for agriculture than for development. Farmland located closer to the city or the commuting highway commands a premium if it has a residence on it, with a residence also explaining why smaller agricultural properties sell at higher prices. However, it appears that zoning by itself is insufficient to protect farmland; other policies likely need to be implemented in conjunction with zoning to protect agricultural land.
    Keywords: Q15 - Land Ownership and Tenure ; Land Reform ; Land Use ; Irrigation, Q28 - Government Policy, R14 - Land Use Patterns
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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    Capitalized Amenity Value of Native Vegetation in a Multifunctional Rural Landscape (2014)
    Oxford University Press
    Details
    Publication Date: 2014-12-13
    Description: In many parts of the world, natural vegetation has been cleared to allow agricultural production. To ensure a long-term flow of ecosystem services without compromising agricultural activities, restoring the environment requires a balance between public and private benefits and costs. Information about private benefits generated by environmental assets can be utilized to identify conservation opportunities on private lands, evaluate environmental projects, and design effective policy instruments. We use a spatio-temporal hedonic model to estimate the private benefits of native vegetation on rural properties in the state of Victoria, Australia. Specifically, we estimate the marginal value of native vegetation on private land and examine how it varies with the extent of vegetation on a property and across a range of property types and sizes. Private benefits of native vegetation are greater per unit area on small and medium-sized properties and smaller on large production-oriented farms. Native vegetation exhibits diminishing marginal benefits as its proportion of a property increases. The current extent of native vegetation cover is lower than the extent that would maximize the amenity value to many landowners. There is scope for improved targeting of investment in the study region by incorporating private benefits of environmental projects into environmental planning processes. Landowners with high marginal private benefits from revegetation would be more willing to participate in a revegetation program. Targeting these landowners would likely provide higher value for money because such projects could be implemented at lower public cost.
    Keywords: Q15 - Land Ownership and Tenure ; Land Reform ; Land Use ; Irrigation, Q57 - Ecological Economics: Ecosystem Services ; Biodiversity Conservation ; Bioeconomics
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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    Examining the Relationship between the Use of Supermarkets and Over-nutrition in Indonesia (2015)
    Oxford University Press
    Details
    Publication Date: 2015-03-14
    Description: This study examines the relationship between the use of modern food retailers and health outcomes using data from a survey of 1,180 urban households in Indonesia. The dependent variables include adult and child body-mass index and the share of individuals overweight and obese. After controlling for individual and household characteristics and using standard and Lewbel instrumental variable approaches to control for unobservable characteristics, we do not find a statistically significant relationship between use of supermarkets and adult nutrition measures. On the other hand, there is mixed evidence for a negative effect of supermarkets on child nutrition, particularly for those in high-income households.
    Keywords: I15 - Health and Economic Development, P46 - Consumer Economics ; Welfare and Poverty, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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    Position Bias in Best-worst Scaling Surveys: A Case Study on Trust in Institutions (2015)
    Oxford University Press
    Details
    Publication Date: 2015-03-14
    Description: This paper investigates the effect of items’ physical position in the best-worst scaling technique. Although the best-worst scaling technique has been widely used in many fields, the literature has largely overlooked the phenomenon of consumers’ adoption of processing strategies while making their best-worst choices. We examine this issue in the context of consumers’ trust in institutions to provide information about a new food technology, nanotechnology, and its use in food processing. Our results show that approximately half of the consumers used position as a schematic cue when making choices. We find the position bias was particularly strong when consumers chose their most trustworthy institution compared to their least trustworthy institution. In light of our findings, we recommend that researchers in the field be aware of the possibility of position bias when designing best-worst scaling surveys. We also encourage researchers who have already collected best-worst data to investigate whether their data shows such heuristics.
    Keywords: C25 - Discrete Regression and Qualitative Choice Models, D12 - Consumer Economics: Empirical Analysis, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
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    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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    The Effect of Chronic Illness on Participation in the Supplemental Nutrition Assistance and Medicaid Programs (2014)
    Oxford University Press
    Details
    Publication Date: 2014-09-02
    Description: We examine enrollment in the U.S. Medicaid and Supplemental Nutrition Assistance Programs (SNAP) and find that while SNAP-eligible adults in poor physical health and with multiple chronic conditions are more likely to jointly enroll in SNAP and Medicaid, they are less likely to enroll in SNAP alone. We also find that the conditional probability of SNAP enrollment given Medicaid participation is higher for individuals with multiple chronic conditions. As a result, the expansion of Medicaid and state policies that promote enrollment coordination between SNAP and Medicaid are expected to increase the number of individuals in SNAP with chronic medical conditions.
    Keywords: I10 - General, I38 - Government Policy ; Provision and Effects of Welfare Programs, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
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    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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    The Effects of Energy Prices on Agricultural Groundwater Extraction from the High Plains Aquifer (2014)
    Oxford University Press
    Details
    Publication Date: 2014-09-02
    Description: We examine the effects of energy prices on groundwater extraction using an econometric model of a farmer's irrigation water pumping decision that accounts for both the intensive and extensive margins. Our results show that energy prices have an effect on both types of margins. Increasing energy prices would affect crop selection decisions, crop acreage allocation decisions, and farmers’ demand for water. Our estimated total marginal effect, which sums the effects on the intensive and extensive margins, suggests that a $1 per million btu increase in the energy price would decrease water extraction by an individual farmer by 5.89 acre-feet per year, a decrease of 3.6 percent of the average annual extraction rate. Our estimated elasticity of water extraction with respect to energy price is –0.26.
    Keywords: Q15 - Land Ownership and Tenure ; Land Reform ; Land Use ; Irrigation, Q40 - General
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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    Re-examining the Reported Rates of Return to Food and Agricultural Research and Development (2014)
    Oxford University Press
    Details
    Publication Date: 2014-09-02
    Description: At odds with a vast body of economic evidence reporting exceptionally high rates of return to investments in agricultural research and development (R&D), growth in public R&D spending for food and agriculture has slowed in numerous, especially rich, countries worldwide. The observed R&D spending behavior is consistent with a determination that the reported rates of return are perceived as implausible by policy makers. We examine this notion by scrutinizing 2,242 investment evaluations reported in 372 separate studies from 1958 to 2011. We find that the internal rate of return (IRR) is the predominant summary measure of investment performance used in the literature despite methodological criticisms dating back more than a half century. The reported IRRs imply rates of return that are implausibly high. We investigate the reasons for these implausibly high estimates by analytically comparing the IRR to the modified internal rate of return (MIRR). The MIRR addresses several methodological concerns with using the IRR, has the intuitive interpretation as the annual compounding interest rate paid by an investment, and is directly related to the benefit–cost ratio. To obtain more credible rate of return estimates, we then develop a novel method for recalibrating previously reported IRR estimates using the MIRR when there is limited information on an investment's stream of benefits and costs. Our recalibrated estimates of the rate of return are more modest (median of 9.8% versus 39% per year); however, they are still substantial enough to question the current scaling back of public agricultural R&D spending in many countries.
    Keywords: O22 - Project Analysis, Q16 - R&D ; Agricultural Technology ; Agricultural Extension Services, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
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    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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    Corn Area Response to Local Ethanol Markets in the United States: A Grid Cell Level Analysis (2016)
    Oxford University Press
    Details
    Publication Date: 2016-04-24
    Description: We measure corn and total agricultural area response to the biofuels boom in the United States from 2006 to 2010. Specifically, we use newly available micro-scale grid cell data to test whether a location's corn and total agricultural cultivation rose in response to the capacity of ethanol refineries in their vicinity. Based on these data, acreage in corn and overall agriculture not only grew in already-cultivated areas but also expanded into previously uncultivated areas. Acreage in corn and total agriculture also correlated with proximity to ethanol plants, though the relationship dampened over the time period. A formal estimation of the link between acreage and ethanol refineries, however, must account for the endogenous location decisions of ethanol plants and areas of corn supply. We present historical evidence to support the use of the US railroad network as a valid instrument for ethanol plant locations. Our estimates show that a location's neighborhood refining capacity exerts strong and significant effects on acreage planted in corn and total agricultural acreage. The largest impacts of ethanol plants were felt in locations where cultivation area was relatively low. This high-resolution evidence of ethanol impacts on local agricultural outcomes can inform researchers and policy-makers concerned with crop diversity, environmental sustainability, and rural economic development.
    Keywords: Q15 - Land Ownership and Tenure ; Land Reform ; Land Use ; Irrigation, Q16 - R&D ; Agricultural Technology ; Agricultural Extension Services
    Print ISSN: 0002-9092
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    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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    Does the Minimum Lot Size Program Affect Farmland Values? Empirical Evidence Using Administrative Data and Regression Discontinuity Design in Taiwan (2016)
    Oxford University Press
    Details
    Publication Date: 2016-04-24
    Description: This study empirically assesses the causal effect of the minimum lot size program on farmland values in Taiwan. A unique dataset of 4,032 parcels of farmland drawn from administrative foreclosure auction profiles between 2000 and 2008 and regression discontinuity design were applied to cope with the endogeneity issue of land use regulations. The results of the parametric and nonparametric estimations indicate that the minimum lot size program significantly increases farmland value by approximately 18% and 15%, respectively. Moreover, the program effect is more pronounced for farmland located in urban/suburban areas. In the absence of a tax effect and externality resulting from non-agricultural activities, the significant program effect on farmland values is likely to result from the effect of the program on farmland's option value for future development.
    Keywords: Q15 - Land Ownership and Tenure ; Land Reform ; Land Use ; Irrigation, R52 - Land Use and Other Regulations
    Print ISSN: 0002-9092
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    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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    The Economy-wide Impacts and Risks of Malawi's Farm Input Subsidy Program (2016)
    Oxford University Press
    Details
    Publication Date: 2016-04-24
    Description: We estimate the impact of Malawi's Farm Input Subsidy Program using an economy-wide approach. This approach yields benefit-cost ratios about 60% higher than existing partial equilibrium studies, a result of our accounting for indirect benefits. Fertilizer response rates remain the determining parameter for benefit-cost ratio levels. Even with lower-end response rates, the program is pro-poor and generates double-dividends through higher and more drought-resilient yields. Overall, for macro-economically significant programs, our approach strongly complements survey-based evaluations. For Malawi, our results buttress arguments for a focus on program improvements.
    Keywords: C68 - Computable General Equilibrium Models, O13 - Agriculture ; Natural Resources ; Energy ; Environment ; Other Primary Products, O22 - Project Analysis, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
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    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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    Modeling the Market and Welfare Effects of Mexico's "Agriculture by Contract" Program (2016)
    Oxford University Press
    Details
    Publication Date: 2016-04-24
    Description: "Agriculture by contract" ( $\hbox {A}\times \hbox {C}$ ) is the main Mexican government program aimed at mitigating price risks for agricultural producers in Mexico. $\hbox {A} \times \hbox {C}$ has unique features involving forward contracts and the provision of basis subsidies and subsidized exchange-traded futures options for both producers and intermediaries. A simulation model is developed to analyze the market and welfare effects of $\hbox {A}\times \hbox {C}$ . When applied to corn, results show that $\hbox {A}\times \hbox {C}$ exerts substantial impacts and causes large transfers across sectors. Even if $\hbox {A}\times \hbox {C}$ reduced intermediaries' market power to the largest extent feasible, results indicate that it would still cause important losses in aggregate welfare.
    Keywords: Q11 - Aggregate Supply and Demand Analysis ; Prices, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
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    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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    Bayesian Estimation of Possibly Similar Yield Densities: Implications for Rating Crop Insurance Contracts (2016)
    Oxford University Press
    Details
    Publication Date: 2016-03-31
    Description: The Agricultural Act of 2014 solidified insurance as the cornerstone of U.S. agricultural policy. The Congressional Budget Office (2014) estimates that this act will increase spending on agricultural insurance programs by $5.7 billion to a total of $89.8 billion over the next decade. In light of the sizable resources directed toward these programs, accurate rating of insurance contracts is of the utmost importance to producers, private insurance companies, and the federal government. Unlike most forms of insurance, agricultural insurance is plagued by a paucity of spatially correlated data. A novel interpretation of Bayesian Model Averaging is used to estimate a set of possibly similar densities that offers greater efficiency if the set of densities are similar while seemingly not losing any if the set of densities are dissimilar. Simulations indicate that finite sample performance—in particular small sample performance—is quite promising. The proposed approach does not require knowledge of the form or extent of any possible similarities, is relatively easy to implement, admits correlated data, and can be used with either parametric or nonparametric estimators. We use the proposed approach to estimate U.S. crop insurance premium rates for area-type programs and develop a test to evaluate its efficacy. An out-of-sample game between private insurance companies and the federal government highlights the policy implications for a variety of crop-state combinations. Consistent with the simulation results, the performance of the proposed approach with respect to rating area-type insurance—in particular small sample performance—remains quite promising.
    Keywords: Q16 - R&D ; Agricultural Technology ; Agricultural Extension Services, Q18 - Agricultural Policy ; Food Policy
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    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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    A Novel, Spatiotemporally Explicit Ecological-economic Modeling Procedure for the Design of Cost-effective Agri-environment Schemes to Conserve Biodiversity (2016)
    Oxford University Press
    Details
    Publication Date: 2016-03-31
    Description: Agri-environment schemes (AES) compensate farmers for land use measures that are costly to them but beneficial to biodiversity and the environment. We present an ecological-economic modeling procedure for the design of cost-effective AES to conserve grassland biodiversity, which is applicable to large areas, covers many endangered species and grassland types, and includes several hundred different types of mowing regimes, grazing regimes, and combinations of mowing and grazing regimes as land use measures. The modeling procedure also accounts for the spatial variations in the land use measures' costs and in the effects on species and grassland types. The procedure's main novelty is that it considers variations of the costs and impacts on species and grassland types that arise from different timings of the land use measures. Considering the spatial and the temporal dimension of land use measures makes the modeling procedure spatiotemporally explicit. We demonstrate the power of the modeling procedure by evaluating an existing grassland AES in Saxony, Germany, and identify substantial improvements in terms of cost-effectiveness.
    Keywords: Q15 - Land Ownership and Tenure ; Land Reform ; Land Use ; Irrigation, Q57 - Ecological Economics: Ecosystem Services ; Biodiversity Conservation ; Bioeconomics
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    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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    How Healthy Is Hunger Relief Food? (2016)
    Oxford University Press
    Details
    Publication Date: 2016-03-31
    Description: Distributing healthy food is an important goal for hunger relief agencies, but they face many challenges in meeting it. Budgets for purchasing food are limited, and hunger relief agencies often have little influence over the nutritional quality of food they receive through donations. In a recent study, Healthy Eating Index (HEI) scores were calculated monthly using electronic invoice data for food shelves served by two major food banks in Minnesota. While the HEI is directly related to nutrition guidelines and provides great detail in its scoring, implementation requires careful measurement and classification of foods and a rather complex set of calculations. In addition, a significant portion of food distributed by food banks is mixed pallets of free "miscellaneous" that cannot readily be included in HEI calculations. We propose and test a less data- and labor-intensive measure for characterizing the healthfulness of food distributed by hunger relief agencies. This new measure, the Hunger Relief Nutrition Index (HRNI), facilitates nutritional assessment of miscellaneous foods, allows for easy aggregation of healthfulness scores across food sources and time periods, and correlates well with the HEI.
    Keywords: C81 - Methodology for Collecting, Estimating, and Organizing Microeconomic Data, Q18 - Agricultural Policy ; Food Policy
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    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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    Improving Food Bank Gleaning Operations: An Application in New York State (2016)
    Oxford University Press
    Details
    Publication Date: 2016-03-31
    Description: Gleaning is increasingly attracting the attention of food safety networks, including food banks, as a valuable tool that simultaneously reduces food loss and alleviates food insecurity. However, managing gleaning operations can be challenging because the arrival of gleaning opportunities and the attendance of gleaner volunteers are both stochastic. We develop a stochastic optimization model to characterize and optimize a gleaning operation. The food bank chooses the gleaning schedule, which affects the gleaner capacity and the number of gleaning opportunities scheduled. In a specific field study of the Food Bank of the Southern Tier in New York, we analyze the tradeoff between call and volume service levels to find the optimum schedule that maximizes the expected total volume gleaned. Moreover, we find that increasing the gleaning window and increasing slot availability can be used as substitute mechanisms for increasing the total volume gleaned. Additionally, we use our model to assess the impact of recruiting more volunteer gleaners.
    Keywords: C61 - Optimization Techniques ; Programming Models ; Dynamic Analysis, C63 - Computational Techniques, D24 - Production ; Cost ; Capital and Total Factor Productivity ; Capacity, Q18 - Agricultural Policy ; Food Policy
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    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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    Impact of Cost Shocks on Consumer Prices in Vertically-Related Markets: The Case of The French Soft Drink Market (2013)
    Oxford University Press
    Details
    Publication Date: 2013-11-22
    Description: We develop a structural econometric model of the vertical contracts between soft drink manufacturers and retailers to assess the impact of taxes or changes in production costs on consumer prices. Using individual data on food purchases from a representative survey of 19,000 French households in 2005, we estimate consumer demand using a random utility approach. Among a set of possible vertical relationships, we select the model that best fits the data. We evaluate the pass-through rate of changes in input costs (sugar) or of taxes and show that the industry over-shifts cost changes or excise taxes to the consumers. This result challenges the belief that firms do not pass on the full extent of cost changes or excise taxes to consumers.
    Keywords: H32 - Firm, I18 - Government Policy ; Regulation ; Public Health, L13 - Oligopoly and Other Imperfect Markets, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
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    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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    Production Incentives from Static Decoupling: Land Use Exclusion Restrictions (2013)
    Oxford University Press
    Details
    Publication Date: 2013-11-22
    Description: Many agricultural support payments are based on past production with restrictions on how land may currently be used. When support payments to field crops are analyzed in a static framework, they do not directly impact current production decisions. However, over time, as relative profits change, these payments affect current output. The payments may keep land in less profitable production of program crops through restrictions prohibiting potentially more profitable endeavors such as cultivating fruits and vegetables. These payments have the potential to lead to production and trade distortions similar in magnitude to the distortions associated with direct production subsidies.
    Keywords: Q15 - Land Ownership and Tenure ; Land Reform ; Land Use ; Irrigation, Q17 - Agriculture in International Trade, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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    Disinvestment, Farm Size, and Gradual Farm Exit: The Impact of Subsidy Decoupling in a European Context (2013)
    Oxford University Press
    Details
    Publication Date: 2013-11-22
    Description: The recent reform of the Common Agricultural Policy, which decouples farm subsidies from production, is expected to impact on farmers’ production decisions. We perform a cross-country farm-level empirical analysis of farmers’ production responses to these reforms using a panel dataset for the EU15 countries for the period 2001–2007. We apply quasi-experimental empirical methods and find that the probability of a farm disinvesting decreased due to the policy change for most farms. However, the policy change facilitated exit for farms engaged in livestock production and those that were already in the process of leaving the sector.
    Keywords: D22 - Firm Behavior: Empirical Analysis, Q12 - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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    Tails Curtailed: Accounting for Nonlinear Dependence in Pricing Margin Insurance for Dairy Farmers (2014)
    Oxford University Press
    Details
    Publication Date: 2014-07-23
    Description: Livestock Gross Margin Insurance for Dairy Cattle (LGM-Dairy) is a risk management tool for protecting milk income over feed cost margins. In this article, we examine the assumptions underpinning the method used to determine LGM-Dairy premiums. Analysis of the milk–feed dependence structure is conducted using copula methods, a rich set of tools that allow modelers to capture nonlinearities in dependence among variables of interest. We find a significant relationship between milk and feed prices that increases with time-to-maturity and severity of negative price shocks. Extremal, or tail, dependence is the propensity of dependence to concentrate in the tails of a distribution. A common theme in financial and actuarial applications and in agricultural crop revenue insurance is that tail dependence increases the risk to the underwriter and results in higher insurance premiums. We present, to our knowledge, the first case in which tail dependence may actually reduce actuarially fair premiums for an agricultural risk insurance product. We examine hedging effectiveness with LGM-Dairy and show that, even in the absence of basis or production risk, hedging horizon plays an important role in the ability of this tool to smooth farm income over feed cost margins over time. Rating methodology that accounts for tail dependence between milk and feed prices extends the optimal hedging horizon and increases hedging effectiveness of the LGM-Dairy program.
    Keywords: G13 - Contingent Pricing ; Futures Pricing, Q13 - Agricultural Markets and Marketing ; Cooperatives ; Agribusiness, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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    Real Options Approach to Inter-Sectoral Migration of U.S. Farm Labor (2014)
    Oxford University Press
    Details
    Publication Date: 2014-07-23
    Description: The core of the literature on inter-sectoral labor migration is based on net present value models of investment in which individuals are assumed to migrate to take advantage of positive wage differentials. In this article, we argue that a real options approach, taken together with the adjustment costs associated with sectoral relocation, may provide a basis for explaining the migration of farm labor out of the agricultural sector. Given the irreversibility of migration decisions and uncertainty in the economy, potential migrants might choose to postpone migration, even in the face of positive wage differentials. Using annual U.S. employment data from between 1948 and 2009, our results indicate that large elasticities between economic incentives and out-farm migration are observed after a high threshold of wage differentials between farm and off-farm sectors is surpassed.
    Keywords: J62 - Job, Occupational, and Intergenerational Mobility, Q12 - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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    Land Markets and the Value of Water: Hedonic Analysis Using Repeat Sales of Farmland (2014)
    Oxford University Press
    Details
    Publication Date: 2014-07-23
    Description: The lack of robust water markets makes it difficult to value irrigation water. Because water rights are appurtenant to land, it is possible to infer the value of water from observed differences in the market price of land. We use panel data on repeat farmland sales in California's San Joaquin Valley to estimate a hedonic regression equation with parcel fixed effects. This controls for sources of omitted variables bias and allows us to recover the value of irrigation water to landowners in our sample. We show that a more traditional cross-sectional regression results in an artificially low value of irrigation water.
    Keywords: Q15 - Land Ownership and Tenure ; Land Reform ; Land Use ; Irrigation, Q24 - Land, Q25 - Water
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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    The Value of Heterogeneous Property Rights and the Costs of Water Volatility (2017)
    Oxford University Press
    Details
    Publication Date: 2017-01-05
    Description: The system of prior appropriation in the Western Unites States prioritizes property rights for water based on the establishment of beneficial use, creating a hierarchy where rights initiated first are more secure. I estimate the demand for security in water rights through their capitalization in agricultural property markets in the Yakima River Basin, a major watershed in Washington State. All water rights are satisfied in an average year, so the relative value of secure property rights is a function of water supply volatility and the costs of droughts are predominantly born by those with weak rights. In aggregate, security in water rights does not capitalize into property values at the irrigation district level; however, there is heterogeneity in the premium for secure water rights. The lack of a premium for district-level water security is robust to a variety of econometric methods to account for correlated district unobservables, and the null result produces an economically significant upper bound on the value to water security for the district. The ability for farmers to adapt to water supply volatility, as well as expectations about water markets and government infrastructure investment, are leading explanations for the lack of an aggregate premium. These explanations are supported by the pattern of heterogeneity in the water security premium.
    Keywords: Q15 - Land Ownership and Tenure ; Land Reform ; Land Use ; Irrigation, Q21 - Demand and Supply, Q24 - Land, Q25 - Water, Q54 - Climate ; Natural Disasters ; Global Warming
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
    Published by Oxford University Press
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    Socioeconomic and Demographic Determinants of the Nutritional Content of National School Lunch Program Entree Selections (2017)
    Oxford University Press
    Details
    Publication Date: 2017-01-05
    Description: New National School Lunch Program (NSLP) guidelines aim to reduce sodium and saturated fats, limit calories, and eliminate trans-fat and whole milk. This paper provides a novel approach to understanding how the healthfulness of NSLP participants’ entrée selections varies across socioeconomic and demographic groups. Unlike previous studies that rely on dietary recalls, we use a mixed logit model to examine students’ entrée choices in a school cafeteria. We estimate the likelihood that an entrée is selected from the available lunch choices as a function of the entrée’s nutrients (fat, carbohydrate, protein, and sodium) and entrée’s taste profile characteristics (e.g., Mexican, Pizza-like), as well as the student’s socio-economic and demographic characteristics. Using these estimates, we examine how changing the nutritional content of an offering impacts the probability of selecting each of the offerings. Free lunch recipients are more likely to choose entrées higher in fat but lower in sodium than other students. Full-price lunch recipients are the most responsive to changes in nutritional content of the offerings and are most likely to respond to changes in the nutritional content of the offered entrées by substituting a lunch brought from home for the school-purchased lunch. Replacing less healthy menu items with popular but healthier items reduces the selection of total calories, calories from fat, and sodium by approximately 4%, 18%, and 8%, respectively, over the study period. The new guidelines should be effective at improving the nutrition of school-age children, and potentially reducing childhood obesity, provided NSLP participation does not decline appreciably.
    Keywords: D12 - Consumer Economics: Empirical Analysis, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
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    Crop Choice, School Participation, and Child Labor in Developing Countries: Cotton Expansion in Burkina Faso (2017)
    Oxford University Press
    Details
    Publication Date: 2017-01-05
    Description: We estimate the effects of changes in cotton adoption on children’s schooling and child labor in rural Burkina Faso. Using time and spatial variations, we find evidence that expansion of cotton farming has led to an increase in enrollment and to a reduction of participation in child labor for girls. There are, however, no detectable effects on boys. In theory, cotton adoption could increase household income, leading to increased demand for schooling and reduced child labor. On the other hand, because children are productive on cotton farms, adoption of cotton could increase the opportunity cost of child time and the demand for child labor. We provide suggestive evidence showing that boys are more productive than girls on cotton farms. Taken together, the results suggest that the income effect from cotton adoption might have been larger than the wage effect for girls, hence the overall positive impacts on school enrollment for girls.
    Keywords: O12 - Microeconomic Analyses of Economic Development, O13 - Agriculture ; Natural Resources ; Energy ; Environment ; Other Primary Products, O15 - Human Resources ; Human Development ; Income Distribution ; Migration, Q18 - Agricultural Policy ; Food Policy
    Print ISSN: 0002-9092
    Electronic ISSN: 1467-8276
    Topics: Agriculture, Forestry, Horticulture, Fishery, Domestic Science, Nutrition , Economics
    Published by Oxford University Press
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