nep-agr New Economics Papers
on Agricultural Economics
Issue of 2005‒02‒13
twenty-one papers chosen by
Angelo Zago
Universita degli Studi di Verona

  1. Regulating Between National Fears and Global Disciplines: Agricultural Biotechnology in the EU By Gregory Shaffer; Mark Pollack
  2. Bridging research, policy, and practice in African agriculture By Omamo, Steven Were
  3. Strategic analysis and knowledge support systems for rural development strategies in Sub-Saharan Africa By Johnson, Michael; Resnick, Danielle
  4. The importance of public investment for reducing rural poverty in middle-income countries By Fan, Shenggen; Jitsuchon, Somchai; Methakunnavut, Nuntaporn
  5. Smallholder African agriculture By Resnick, Danielle
  6. International exchange of genetic resources, the role of information and implications for ownership By Rubenstein, Kelly Day; Smale, Melinda
  7. Dairy development in Ethiopia By Mohamed A. M. Ahmed; Ehui, Simeon; Yemesrach, Assefa
  8. Spatial patterns of crop yields in Latin America and the Caribbean By Wood, Stanley; You, Liangzhi; Zhang, Xiaobo
  9. Assessing the spatial distribution of crop production using a cross-entropy method By You, Liangzhi; Wood, Stanley
  10. Water allocation policies for the Dong Nai River Basin in Vietnam By Ringler, Claudia; Vu Huy, Nguyen
  11. Assets at marriage in rural Ethiopia By Fafchamps, Marcel; Quisumbing, Agnes R.
  12. Evidence and implications of non-tradability of food staples in Tanzania 1983-1998 By Delgado, Christopher; Minot, Nicholas; Tiongco, Marites
  13. Are horticultural exports a replicable success story? By Minot, Nicholas; Ngigi, Margaret
  14. Producer Support Estimates (PSEs) for agriculture in developing countries By Mullen, Kathleen; Sun, Dongsheng; Orden, David; Gulati, Ashok
  15. Domestic support to agriculture in the European Union and the United States By Gopinath, Munisamy; Mullen, Kathleen; Gulati, Ashok
  16. Post-Uruguay Round price linkages between developed and developing countries By Yavapolkul, Navin; Gopinath, Munisamy; Gulati, Ashok
  17. Agricultural diversification in India and role of urbanization By Rao, P. Parthasarathy; Birthal, P. S.; Joshi, P. K.; Kar, D.
  18. Agricultural policies in Indonesia By Thomas, Marcelle; Orden, David
  19. Agricultural policies in Vietnam By Nguyen, Hoa; Grote, Ulrike
  20. "It pays to be green" - a premature conclusion? By Kjetil Telle, Iulie Aslaksen and Terje Synnestvedt
  21. Environmental risk and the precautionary principle. “Late lessons from early warnings” applied to genetically modified plants By Iulie Aslaksen, Bent Natvig and Inger Nordal

  1. By: Gregory Shaffer; Mark Pollack
    Abstract: In this paper, we develop three interrelated arguments about the nature of GMO regulation and the challenges that it poses to the European Union (EU). First, we highlight the inherently multi-sectoral nature of GMO regulation, which links together the internal market with industrial policy, research and technological development, environmental policy, food safety, agriculture, and international trade. As a multi-sectoral issue, the regulation of GMOs raises the challenge of coordinating policymaking horizontally among a large number of public and private actors with diverse perspectives about the aims and the content of EU regulation. Second, we emphasize the multi-level nature of the process, which involves overlapping and sometimes conflicting regulations promulgated at the national, supranational/EU, and international levels. As such, EU policy has faced sharp political and legal challenges both from below (in the form of national revolts against the licensing of individual GM foods and crops) and from above (in the form of challenges from other countries within the World Trade Organization, or WTO). Third, the regulation of GM foods and crops is an instance of a broader category of “risk regulation,” in which government actors are called upon to adopt regulations about the acceptable degree of risk posed to society by products or industrial processes. Such decisions about risk regulation – including the regulation of GMOs – not only mobilize diverse interest groups, they also raise fundamental normative questions about the degree of risk judged to be acceptable to society, as well as about the roles of science and politics in the regulation of risk under uncertainty. As such, risk regulation raises fundamental questions of the legitimacy of decision-making at different levels of government, and, in particular, for our case, at the supranational level of EU institutions.
    Date: 2004–12–12
  2. By: Omamo, Steven Were
    Abstract: "Policy research on African agriculture is long on prescriptions for what needs to be done to spur agricultural growth but short on how such prescriptions might be implemented in practice. What explains this state of affairs? What might be done to correct it, and, most important, how? This paper addresses these questions via a comprehensive review and assessment of the literature on the role and impact of research in policy processes. Six major schools of thought are identified: the rational model; pragmatism under bounded rationality; innovation diffusion; knowledge management; impact assessment; and evidence-based-practice. The rational model with its underlying metaphor of a 'policy cycle' comprising problem definition and agenda setting, formal decision making, policy implementation, evaluation, and then back to problem definition and agenda setting, and so on has been criticized as too simplistic and unrealistic. Yet it remains the dominant framework guiding attempts to bridge gaps between researchers and policy makers. Each of the other five schools relaxes certain assumptions embedded within the rational model e.g., wholly rational policy makers, procedural certainty, well-defined research questions, well-defined user groups, welldefined channels of communication. In so doing, they achieve greater realism but at the cost of clarity and tractability. A unified portable framework representing all policy processes and capturing all possible choices and tradeoffs faced in bridging research, policy, and practice does not currently exist and is unlikely ever to emerge. Its absence is a logical outcome of the context-specificity and social embeddedness of knowledge. A fundamental shift in focus from a 'researcher-as-disseminator' paradigm to a 'practitioner-as-learner' paradigm is suggested by the literature, featuring contingent approaches that recognize and respond to context-specificity and social embeddedness. At bottom, the issue is how to promote 'evidence-readiness' among inherently conservative and pragmatic policy makers and practitioners and 'user-readiness' among inherently abstraction-oriented researchers." Author's Abstract
    Keywords: Policy research ,Agriculture Africa ,Agricultural growth ,Research Methodology ,Knowledge management ,evaluation ,
    Date: 2004
  3. By: Johnson, Michael; Resnick, Danielle
    Abstract: "While greater growth in agriculture and the broader rural sector is crucial for ameliorating Africa's high levels of poverty and malnutrition, developing strategies to achieve these objectives is hindered by a number of factors, including the broad array of interventions needed, the lack of accurate data, and dearth of trained local policy analysts. As such, this paper proposes a Strategic Analysis Knowledge Support System (SAKSS) in which data, tools, and knowledge are compiled, analyzed, and disseminated for the purposes of identifying a set of priority investment and policy options to promote agricultural growth and rural development. These analyses can in turn help inform the broader process of designing, implementing, and monitoring and evaluating a country's rural development strategy. In order to be an influential and sustainable part of this process and become a genuine "knowledge system," SAKSS will need to be established with an awareness of each country s development priorities and unique political, social, and economic context. By institutionalizing SAKSS through a network structure that includes government ministries, research institutions, universities, regional organizations, non-governmental organizations, and donors, SAKSS can become not only more relevant and legitimate for its intended end-users but also help strengthen local analytical capacity to inform the policy debate on future development strategies and outcomes." Authors' Abstract
    Keywords: Agricultural growth ,Strategic analysis ,Development policies Africa, Sub-Saharan ,
    Date: 2004
  4. By: Fan, Shenggen; Jitsuchon, Somchai; Methakunnavut, Nuntaporn
    Abstract: This study estimates the impacts of different types of government expenditure on agricultural growth and rural poverty in Thailand. The results show that, despite Thailand's middle-income status, public investments in agricultural R&D, irrigation, rural education, and infrastructure (including roads and electricity), still have positive marginal impacts on agricultural productivity growth and rural poverty reduction. Additional government spending on agricultural research and development improves agricultural productivity the most and has the second largest impact on rural poverty reduction. Investments in rural electrification reduce poverty the most and have the second largest growth impact. These two investments dominate all others and are win-win for growth and poverty reduction. Road expenditure has the third largest impact on rural poverty reduction, but only a modest and statistically insignificant impact on agricultural productivity. Government spending on rural education has only the fourth largest impact on poverty, but a significant economic impact through improved agricultural productivity. Irrigation investment has the smallest impact on both rural poverty reduction and productivity growth in agriculture. Additional investments in the Northeast region contribute more to reducing poverty than investments in other regions. This is because most of the poor are now concentrated in the Northeast and it has suffered from under investment in the past. The poverty reducing impacts of infrastructure investments, such as electricity and roads, are particularly high in this region. The growth impacts of many investments are also greatest in the Northeast than in other regions, hence there is no evident tradeoff between investments for growth and investments for poverty reduction. Thailand is a middle-income country and it is insightful to compare these results with similar studies undertaken in low-income countries like India, China, and Uganda. Some of the results are similar, for example, the high returns to public investments in agricultural research and some kinds of rural infrastructure arise in most countries because of the inherent market failures associated with these types of public goods. But others results are different. For example, the returns to public investment in education in Thailand are quite low, partly because of increasing private investment but also the inappropriate composition of much public spending on education. Within infrastructure, results from low-income countries often show higher returns to road investments than telecommunications and electricity. But in the case of Thailand, it is investment in electricity that shows the highest return. Thailand has invested heavily in rural roads and a dense road network has already been built, suggesting that additional investment may yield diminishing returns. Also, there has been significant investment by the private sector in rural telecommunication, leading to a much-reduced role for the public sector. This situation differs from many low-income countries, especially in Africa, where the private sector is still embryonic and the public sector must play a dominant investment role for the foreseeable future.
    Date: 2004
  5. By: Resnick, Danielle
    Abstract: In contrast to uniformly pessimistic assessments about Sub-Saharan Africa's (hereafter Africa) ability to meet the Millennium Development Goals (MDGs), this paper examines recent trends in poverty, malnutrition, and growth to delineate where the challenges are the greatest within the entire region and sub-region and to highlight informative cases of success in specific countries. The performance of agriculture, especially smallholder agriculture, receives particular attention due to its role in sustaining the livelihoods of a majority of Africa's poor. In recent years, the importance of smallholder agriculture has been greatly recognized, demonstrated by both African governments and the donor community pledging to engage in the requisite interventions for generating agricultural growth. By seizing on this new enthusiasm and learning from case studies of smallholder successes, agriculture could significantly contribute to Africa's ability to meet the MDGs.
    Keywords: Millenium Development goal ,
    Date: 2004
  6. By: Rubenstein, Kelly Day; Smale, Melinda
    Abstract: "Changing perceptions of resource ownership have altered international exchange of genetic resources. After summarizing the role of genebanks and issues related to property regimes, this paper presents an empirical study of one of the largest national genebanks, the U.S. National Germplasm System. The demand for its genetic resources appears to be substantial, both domestically and internationally. Utilization rates are higher than suggested by past studies. The role of information in enhancing the usefulness of NPGS resources is explored with an econometric model that indicates that accompanying data make germplasm more useful. U.S. requestors account for most of the germplasm demanded, but developing countries appear to make greater use of these resources, proportionally, in terms of overall usefulness, secondary sharing, and the presence of useful data. Demand for public germplasm is likely to increase in the future, particularly from developing countries." Authors' Abstract
    Keywords: Crop genetic resources ,Genebanks ,Germplasm collection ,Genetic resource management ,Developing countries ,
    Date: 2004
  7. By: Mohamed A. M. Ahmed; Ehui, Simeon; Yemesrach, Assefa
    Abstract: Ethiopia holds large potential for dairy development due to its large livestock population, the favorable climate for improved, high-yielding animal breeds, and the relatively disease-free environment for livestock. Given the considerable potential for smallholder income and employment generation from high-value dairy products, development of the dairy sector in Ethiopia can contribute significantly to poverty alleviation and nutrition in the country. Like other sectors of the economy, the dairy sector in Ethiopia has passed through three phases or turning points, following the economic and political policy in the country. In the most recent phase, characterized by the transition towards market-oriented economy, the dairy sector appears to be moving towards a takeoff stage. Liberalized markets and private sector investment and promotion of smallholder dairy are the main features of this phase. Milk production during the 1990s expanded at an annual rate of 3.0 percent compared to 1.63-1.66 percent during the preceding three decades. Review of the development of dairy sector in Ethiopia indicates that there is a need to focus interventions more coherently. Development interventions should be aimed at addressing both technological gaps and marketing problems. Integration of crossbred cattle to the sector is imperative for dairy development in the country. This can be achieved either through promotion of large private investment to introduce new technology in the sector such as improved genotypes, feed and processing, and promotion of integration of crossbred cattle into the smallholder sector through improving their access to improved cattle breeds, AI service, veterinary service, and credit. Similarly, government should also take the lead in building infrastructure and providing technical service to smallholders. Severe shortages, low quality and seasonal unavailability of feed likewise remain as major constraints to livestock production in Ethiopia. These constraints need to be addressed and technological change be promoted to increase milk production.
    Keywords: Ethiopia ,Dairy products industry ,Livestock productivity Ethiopia ,Africa sub-Saharan ,East Africa ,
    Date: 2004
  8. By: Wood, Stanley; You, Liangzhi; Zhang, Xiaobo
    Abstract: From a theoretical perspective crop yields should tend to converge over time and space as: growth in yield potential exhibits diminishing returns; an increasing share of farmers shift to using high yielding varieties (HYVs); barriers to the free flow of knowledge and information are removed; and significant investments continue to be made in supporting institutions whose mandates include facilitating and accelerating the cross-border flow of improved agricultural technologies. Using a new, sub-national crop yield database for Latin America and the Caribbean (LAC) we examine whether convergence is indeed occurring, and discover it is not. On the contrary, there is evidence of divergence. We test three hypotheses that might help account for this finding: that technology generation has been biased towards production in more-favored production systems leaving behind persistent pockets of production in more marginal lands; that rainfall patterns have changed in ways that exacerbate yield divergence, and that technology spillover across borders remains more problematic than within-country spillover. We find evidence to support all three of these hypotheses. Further work is needed to assess the relative importance of these sources of yield divergence both across and within LAC. As anticipated, rainfall variability is poorly linked to the variability of irrigated crop yields, but more strongly linked to variability in rainfed crops. The results suggest while some countries and regions within countries forge ahead with crop yield improvements there are many areas, often in smaller countries, where the livelihoods of many farmers - and likely a disproportionate share of LAC's rural poor - continue to be constrained by low-productivity agriculture. There remains significant work ahead for national governments and for publicly-funded regional and international agricultural technology institutions to remedy this situation.
    Date: 2004
  9. By: You, Liangzhi; Wood, Stanley
    Abstract: While agricultural production statistics are reported on a geopolitical – often national - basis we often need to know the status of production or productivity within specific sub-regions, watersheds, or agro-ecological zones. Such re-aggregations are typically made using expert judgments or simple area-weighting rules. We describe a new, entropy-based approach to making spatially disaggregated assessments of the distribution of crop production. Using this approach tabular crop production statistics are blended judiciously with an array of other secondary data to assess the production of specific crops within individual ‘pixels' – typically 25 to 100 square kilometers in size. The information utilized includes crop production statistics, farming system characteristics, satellite-derived land cover data, biophysical crop suitability assessments, and population density. An application is presented in which Brazilian state level production statistics are used to generate pixel level crop production data for eight crops. To validate the spatial allocation we aggregated the pixel estimates to obtain synthetic estimates of municipio level production in Brazil, and compared those estimates with actual municipio statistics. The approach produced extremely promising results. We then examined the robustness of these results compared to short-cut approaches to spatializing crop production statistics and showed that, while computationally intensive, the cross-entropy method does provide more reliable estimates of crop production patterns.
    Keywords: Entropy ,Cross entropy ,Remote sensing ,Spatial allocation ,Crop distribution ,
    Date: 2004
  10. By: Ringler, Claudia; Vu Huy, Nguyen
    Abstract: Recent water sector reforms, increased scarcity and vulnerability of existing water resources, combined with declining public funding available for large-scale infrastructure investment in the sector have led to an increased awareness by the Government of Vietnam for the need to analyze water resource allocation and use in an integrated fashion, at the basin scale, and from an economic efficiency perspective. This paper presents the development, application, and results from an integrated economic-hydrologic river basin model for the Dong Nai River Basin in southern Vietnam that attempts to address these issues. The model framework takes into account the sectoral structure of water users (agriculture, industry, hydropower, households, and the environment), the location of water-using regions, and the institutions for water allocation in the basin. Water benefit functions are developed for the major water uses subject to physical, system control, and policy constraints. Based on this modeling framework, policies that can affect water allocation and use at the basin level, including both basin-specific and general macroeconomic policies, are analyzed.
    Keywords: River basin model ,water allocation policy ,integrated assessment ,Vietnam ,Dong Nai basin ,
    Date: 2004
  11. By: Fafchamps, Marcel; Quisumbing, Agnes R.
    Abstract: "This paper contributes to the economic analysis of marriage and the family by examining and analyzing the relative importance of potential determinants of assets brought to marriages in rural Ethiopia. One potential determinant is assortative matching, whereby the rich marry the rich and the poor marry the poor, generating a positive correlation between assets brought to marriage by both spouses. Another determinant explored is compensating parental transfers at marriage, whereby parents reduce assets transferred to their marrying children if their spouses bring more. The third determinant analyzed is parents' strategic behavior to improve the marriage-market ranking of their children by transferring more assets to them at the time of marriage." from Text
    Keywords: Intrahousehold allocation ,Intergenerational transfers ,Marriage market ,Inheritance ,
    Date: 2004
  12. By: Delgado, Christopher; Minot, Nicholas; Tiongco, Marites
    Abstract: "Economic reform programs assume that major goods are tradable, such that depreciation of the real exchange rate raises the value of output compared to factor costs in domestic currency. In Tanzania, major food staples that account for most real income are non-tradables in at least one-quarter of the country. This is demonstrated and implications assessed for the constraints imposed on macroeconomic-led adjustment strategies." Author's Abstract
    Keywords: Food staples ,Food prices ,Tradable goods ,Non-tradable goods ,
    Date: 2004
  13. By: Minot, Nicholas; Ngigi, Margaret
    Abstract: Kenyan horticultural exports are often cited as a success story in African agriculture. Fruit and vegetable exports from Côte 'Ivoire have received less attention, but the export value is similar to that of Kenya. This paper focuses on three questions. First, do the horticultural sectors of Kenya and Côte d'Ivoire constitute valid success stories? Second, what factors have contributed to the success (or lack thereof)? And third, to what degree can the success be replicated in other African countries? The paper finds that Kenyan horticultural exports are indeed a success story: horticulture has become the third largest earner of foreign exchange, more than half the exports are produced by smallholders, and smallholders gain from producing for the export market. At the same time, the total number of smallholders producing for export is relatively small, and trends in European retailing may shift the advantage to larger producers. Côte d'Ivoire is not as clearly a success story because the most of the exports are produced on large industrial estates and because growth has been uneven. Ivorian exports rely on preferential access to European markets relative to Latin American exporters, raising doubts about sustainability. Factors in the growth and success of horticultural exports include a realistic exchange rate, stable policies, a good investment climate, competitive international transport connections, institutional, and social links with markets in Europe, and continual experimentation with the market institutions to link farmers and exporters. Smallholder participation is encouraged by farmer training and extension schemes, investment in small-scale irrigation, and assistance in establishing links with exporters. Many of the lessons of Kenyan horticulture can be applied elsewhere in Africa. Indeed, Kenya faces increasing competition from neighboring countries trying to replicate its success. At the same time, market institutions take time to develop, and demand constraints probably prevent other African countries from achieving the same level of success as Kenya.
    Date: 2004
  14. By: Mullen, Kathleen; Sun, Dongsheng; Orden, David; Gulati, Ashok
    Abstract: In many developing countries, governments rely on price-based measures (including border protection and subsidies on inputs and outputs) more than on budgetary payments to achieve agricultural policy objectives defined to include price stabilization or food self-sufficiency. Assessing the effects of these price-based measures is thus important to evaluating whether agriculture is being protected or disprotected by commodity or in the aggregate. This aspect of producer support estimates (PSEs) is simple to describe conceptually but difficult to evaluate well empirically. Developing countries may face higher international transport and port costs for imports and exports than developed countries or may have substantial internal handling, transportation and processing costs. Separating these structural effects on farmers from agricultural policy effects that drive a wedge between the domestic farmgate price and an adjusted international reference price requires extensive data and judgments. In this paper, we describe the PSE measurement issues and illustrate their importance. We estimate product-specific market price support, budget expenditures and PSEs for three important agricultural commodities (wheat, rice and corn) in India (1985-2002), using representative disaggregated state-level results, and for five commodities (wheat, rice, corn, soybeans and sugar) in China (1995-2001). The results for India suggest that ignoring factors such as internal transport costs, marketing margins and quality differences can result in inaccurate price support estimates and PSEs that may be of the wrong sign. We also explore how relaxing or changing certain standard PSE assumptions (such as altering the “scaling up” procedure or computing the PSE as a percentage of value of production at world reference prices) can have large impacts on the results. Finally, for commodities that are near self-sufficiency, we follow Byerlee and Morris (1993) and define a relevant adjusted reference price based on the relationship between an estimated autarky price and the import and export prices. We discuss this procedure and use the resulting reference prices to compute the market price support component of the PSE for India. Based on our three-commodity PSEs for India, support is largely counter-cyclical, rising when world prices are low (as in the late 1980s and 1990s) and falling when world prices strengthen (as in the mid 1990s). From our more preliminary five-commodity PSE estimates for China, a trend decline in disprotection is more evident. Further research is needed to confirm and elaborate on these results.
    Date: 2004
  15. By: Gopinath, Munisamy; Mullen, Kathleen; Gulati, Ashok
    Abstract: In this study, we outline the farm policy changes in the European Union, EU, and the United States, US, since 1996 and compare their levels of support under various policies. The producer support estimates for the EU are more than twice that of the US, although the value of EU agricultural production is only 30% more than the US production value. In the EU, reductions in the intervention (support) prices for cereals, oilseeds and beef sector have been compensated by increased direct payments, i.e., payments based on historical acreage and yield or animal head counts. In 1996, the US eliminated target prices and deficiency payments for major crops, and acreage set-sides for supply control. They have been replaced with fixed and emergency payments. However price floors (loan rate with deficiency payments) have been retained for major crops. The sugar and dairy sector policies of the EU and the US have undergone few changes since 1996....The initial EU and US agricultural proposals for the Doha round focused on reducing market access barriers and export subsidies, but refrained from limiting domestic support measures. Developing countries' effective opposition to these proposals led to the collapse of the 2003 WTO Ministerial Meeting at Cancun, Mexico. The recently announced Doha Work Program proposes complete elimination of export subsidies and significant reductions in market access barriers. In the case of domestic support, developing countries' views such as the reductions in product and non-product specific de minimis provisions, and the criteria for blue box payments are reflected in the proposal. At the same time, developed countries' views on the continued placement of direct payments in either blue or green box have been included in the proposal. However, agreement on the extent of reductions and the specific modalities is expected in the next 16 months. The final agreement, scheduled for presentation to members at the Hong Kong WTO Ministerial Conference in December 2005, likely depends on whether or not the new proposals and their modalities would result in meaningful limits on domestic support.
    Keywords: Agricultural price supports ,
    Date: 2004
  16. By: Yavapolkul, Navin; Gopinath, Munisamy; Gulati, Ashok
    Abstract: The Uruguay Round Agreement on Agriculture attempted to lower distortions in the global agricultural markets. However, the significant fall in commodity prices in late 1990s may have reduced the incentives for both developed and developing countries to better integrate into the world markets. This study analyzes price linkages and adjustment between developed and developing countries during the post-Uruguay Round period. Prices of two key commodity markets, long-grain rice and medium-hard wheat, are assembled for major exporters and producers. Results from the multivariate cointegration analysis suggest partial market integration between developed and developing countries in the post-Uruguay Round period. Developed countries are found to be price leaders in these two markets, and in most cases, the changes in their prices have relatively large impacts on those of the developing countries. The new entrants into world markets (Vietnam and Argentina) have faced considerable price adjustment due to changes in the developed countries' prices.
    Keywords: Price linkages ,Wheat markets ,Rice markets ,Uruguay Round Agreement on Agriculture (URAA) ,Doha Developmental Round of the World Trade Organization (WTO) ,
    Date: 2004
  17. By: Rao, P. Parthasarathy; Birthal, P. S.; Joshi, P. K.; Kar, D.
    Abstract: Indian agriculture is diversifying during the last two decades towards High-Value Commodities (HVCs) i.e., fruits, vegetables, milk, meat, and fish products. The pace has been accelerated during the decade of 1990s. HVCs account for a large share in the total value of agricultural production. Supply and demand side factors coupled with infrastructural development and innovative institutions drive these changes. In this paper, the focus is on diversification towards HVCs in the context of urbanization. Group of urban districts (districts with >1.5 million urban population) have a higher share of HVCs compared to the urban-surrounded (near urban districts) and other districts (districts in the hinterland). Among the HVCs, vegetables and meat products have a higher share in urban districts compared to the other two groups. Milk production is more widespread due to excellent network of co-operatives and infrastructure facilities. Using GIS (geographic Information System) approach it was found that urban-surrounded districts with better road network connection to urban centers have been able to diversify towards HVC's to meet the demand in the urban centers. Model results further confirm these findings. Thus, urbanization is a strong demand side driver promoting HVCs. Since urban population is growing at more than 3% per annum, demand for HVCs will drive their production. The analysis has also brought out regional variations in HVCs across different districts in the country that has implications on regional development and planning, and consequently on public and private sector investment strategies.
    Date: 2004
  18. By: Thomas, Marcelle; Orden, David
    Abstract: As in many other developing countries, the concerns about food security in Indonesia during the 1980s and early 1990s resulted in policies aimed at achieving self-sufficiency in food crops. The Government of Indonesia (GOI) combined price interventions and economic incentives to encourage agricultural production, especially of the staple crops. From 1985 to 1998, Indonesia started a series of domestic and trade reforms emanating from a combination of unilateral undertakings, the country's commitments to the WTO, and the government's agreement with the IMF following the 1997/98 financial crisis. This study computes nominal protection rates and producer support estimates (NPR and PSE) for Indonesia for the period 1985-2003 for six agricultural commodities, rice, maize, sugar, soybeans, crude palm oil, and natural rubber (representing more than two-thirds of Indonesian agricultural output) in an attempt to quantify the net effects of these policies. The NPRs and PSEs computed for Indonesia show that in spite of the reforms, the GOI has protected its agriculture over the past twenty years, although not uniformly across commodities. Although the reforms went a long way in reducing trade and domestic regulations on agricultural products, the study results demonstrate a return to protection for some commodities in recent years.
    Date: 2004
  19. By: Nguyen, Hoa; Grote, Ulrike
    Abstract: Since 1986, Vietnam started to move from a centrally-planned towards a market-oriented system. It underwent several major economic and trade reforms – a process which is still not completed. At the same time, it also started to open its economy. Vietnam has become a member of the ASEAN Free Trade Agreement (AFTA), signed several bilateral trade agreements and is currently negotiating accession to the World Trade Organization (WTO). First positive results of the reform process became visible in the early 1990s when poverty declined to a large extent. Since then, the Vietnamese agricultural sector has also experienced high growth and impressive export achievements. The country changed from a food importer to one of the major exporters worldwide. The question arises to what extent support policies contributed to this growth, especially of the agricultural sector. In order to answer this question, domestic and trade policies in the agricultural sector are analysed and the market price support (MPS) and producer support estimates (PSEs) are calculated. To account for the special conditions in Vietnam, the MPS and PSEs are adjusted for country- and commodity-specific factors like transportation costs, marketing margins and the quality difference of exportables (or importables) at the border and domestically. The selected agricultural commodities for which the MPS and PSEs are estimated include rice, coffee, tea, rubber, pepper, sugar, groundnut, cashew nut and pig meat. These nine commodities are the main agricultural products and exportables of Vietnam. Their shares in total output exceed 70% allowing for a generalization of the calculated PSEs, thus roughly representing the whole agricultural sector. The finding is that most agricultural products were taxed in the mid 1980s until the mid 1990s. This was often due to large inefficiencies in the production and processing of agricultural commodities, the dominance and monopoly position of the state-owned sector, restrictive trade policies like import and export quotas and licenses, and distorted markets and prices in the country. The domestic reform process, the opening of the economy since the early 1990s, and the shift from an import-substitution strategy towards export-promotion, however, impacted on the gaps between the domestic and international prices. Thus, since the mid 1990s, the support of agriculture increased - but still reaching only rather low levels. At its peak, the %PSE for the agricultural sector was 24.2% which is moderate compared with other countries. The low level of protection implies that Vietnam may not face excessive difficulties in its further international integration. This study of Vietnam is the third comprehensive review conducted within an IFPRI project on understanding and assessing domestic and trade policies in the agricultural sector in developing countries. The data are meant to deliver a basis for further trade-related research to be conducted in the future.
    Keywords: Agricultural policies ,Markets ,Free trade ,Trade agreements ,World Trade Organization ,Poverty ,
    Date: 2004
  20. By: Kjetil Telle, Iulie Aslaksen and Terje Synnestvedt (Statistics Norway)
    Abstract: It has been claimed that good environmental performance can improve firms’ economic performance. However, because of e.g. data limitations, the methods applied in most previous quantitative empirical studies of the relationship between environmental and economic performance of firms suffer from several shortcomings. We discuss these shortcomings and conclude that previously applied methods are unsatisfactory as support for a conclusion that it pays for firms to be green. Then we illustrate the effects of these shortcomings by performing several regression analyses of the relationship between environmental and economic performance using a panel data set of Norwegian plants. A simple correlation analysis confirms the positive association between our measures of environmental and economic performance. The result prevails when we control for firm characteristics like e.g. size or sub-industry in a pooled regression. However, the result could still be biased by omitted unobserved variables like management or technology. When we control for unobserved plant specific characteristics in a panel regression, the effect is no longer statistically significant. Hence, greener plants perform economically better, but the analysis provides no support for the claim that it is because they are greener. These empirical findings further indicate that a conclusion that it pays to be green is premature.
    Keywords: Economic performance; environmental performance; environmental regulations; pays to be green
    JEL: Q25 Q28 K23
    Date: 2004–11
  21. By: Iulie Aslaksen, Bent Natvig and Inger Nordal (Statistics Norway)
    Abstract: The environmental risk associated with genetically modified organisms (GMO) implies that new approaches to risk assessment, risk management and risk communication are needed. In this paper we discuss the role of the precautionary principle in policy responses to GMO risk. We first discuss application of the criteria in the European Environment Agency report “Late lessons from early warnings: The precautionary principle 1896-2000” to environmental GMO risk, with focus on crop plants. Moreover, we discuss Bayesian analysis in the context of improving the informational basis for decision making under uncertainty. Finally, environmental uncertainties are intertwined with economic uncertainties. Providing incentives for improved risk assessment, risk management and risk communication is crucial for enhancing social and environmental responsibility and thereby facilitate implementation of precautionary approaches. We discuss ethical screening of companies as an example of how such incentives can be provided.
    Keywords: Environmental risk; precautionary principle; Bayesian analysis; genetically modified organisms.
    JEL: D81 Q20 Q50
    Date: 2004–12

This nep-agr issue is ©2005 by Angelo Zago. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
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NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.