New Economics Papers
on Agricultural Economics
Issue of 2006‒03‒18
five papers chosen by

  1. From Microlevel Decisions to Landscape Changes: An Assessment of Agricultural Conservation Policies By Wu, JunJie; Adams, Richard M.; Kling, Catherine L.; Tanaka, Katsuya
  2. Changing Structure of Pork Trade, Production, and Processing in Mexico, The By Batres-Marquez, S. Patricia; Clemens, Roxanne; Jensen, Helen H.
  3. Incentive to reduce crop trait durability By Ambec, Stefan; Langinier, Corinne; Lemarie, Stephane
  5. Air Emissions of Ammonia and Methane from Livestock Operations: Valuation and Policy Options By Shih, Jhih-Shyang; Burtraw, Dallas; Palmer, Karen L.; Siikamäki, Juha V.

  1. By: Wu, JunJie; Adams, Richard M.; Kling, Catherine L.; Tanaka, Katsuya
    Abstract: The growth in conservation programs has created a need for modeling frameworks capable of measuring microlevel behavioral responses and macrolevel landscape changes. This paper presents an empirical model that predicts farmers' production practices and the resulting levels of agricultural runoffs at more than 42,000 agricultural sites in the upper-Mississippi river basin under alternative conservation policies. Results suggest that payments for conservation tillage and crop rotations increase the use of these conservation practices. However, the acreage response is inelastic and the programs are not likely to be cost effective on their own for addressing hypoxia problem in the Gulf of Mexico.
    Date: 2006–03–10
  2. By: Batres-Marquez, S. Patricia; Clemens, Roxanne; Jensen, Helen H.
    Abstract: The structure of the pork production, slaughter, and processing sectors in Mexico has changed significantly since implementation of the North American Free Trade Agreement (NAFTA) and with rising income and increased urbanization. Today, Mexico’s pork industry has become more integrated and achieved greater production efficiencies in response to increasing demand for better product quality and stricter sanitary practices in production and processing pork for both the domestic market and for export. However, despite these improvements Mexico’s pork industry has not kept up with the rising domestic demand, and Mexico has become an increasingly important market for the United States. A key to the development of increased trade in both live animals and pork is growth of federally inspected or “Tipo Inspección Federal” (TIF) plant production, as well as development of marketing channels and product promotion that support high-quality consumer meat products.
    Keywords: live hogs and pork trade, Mexico, NAFTA, pork industry, pork slaughter, TIF plants.
    Date: 2006–03–14
  3. By: Ambec, Stefan; Langinier, Corinne; Lemarie, Stephane
    Abstract: To reduce the competition from farmers who self-produce seed, an inbred line seed producer can switch to nondurable hybrid seed. In a two-period model we investigate the impact of crop durability on self-production, pricing and switching decisions, and we examine the impact of license fees paid by self-producing farmers. First, in an inbred line seed monopoly model, we find that the monopolist may produce technologically dominated hybrid seed in order to extract more surplus from farmers. Further, the introduction of license fees improves efficiency. Second, we study how the monopolist's behavior is affected by the entry of a nondurable hybrid seed producer. We show that the inbred line seed producer might benefit from competing with a technologically dominated hybrid seed producer, as this allows for consumers' discrimination.
    Keywords: Durable good, nondurable good, licenses.
    JEL: Q1
    Date: 2006–03–14
  4. By: Anke Leroux; John Creedy
    Abstract: An important characteristic defining the threat of environmental crises is the uncertainty about their consequences for future welfare. Random processes governing ecosystem dynamics and adaptation to anthropogenic change are important sources of prevailing ecological uncertainty and contribute to the problem of how to balance economic development against natural resource conservation. The aim of this study is to examine optimal growth subject to non-linear dynamic environmental constraints. In a two-sector exogenous growth framework we model a stochastic environmental good, exhibiting uncertain ecological responses to environmental change, and describe the economic and environmental trade-offs that ensue for a risk-averse social planner. Allowing for ecological risk tends to slow economic growth if environmental impacts are assumed to increase exponentially as the rate of disturbance increases. Taken in isolation the effects of ecosystem resilience and ecological uncertainty on the rate of natural resource development are ambiguous and depend on normative parameters such as the social planner’s attitude to risk and rate of time preference.
    Date: 2005
  5. By: Shih, Jhih-Shyang (Resources for the Future); Burtraw, Dallas (Resources for the Future); Palmer, Karen L. (Resources for the Future); Siikamäki, Juha V. (Resources for the Future)
    Abstract: The animal husbandry industry is a major emitter of methane, which is an important greenhouse gas. The industry is also a major emitter of ammonia, which is a precursor of fine particulate matter—arguably, the number-one environment-related public health threat facing the nation. We present an integrated process model of the engineering economics of technologies to reduce methane and ammonia emissions at dairy operations in California. Three policy options are explored: greenhouse gas offset credits for methane control, particulate matter offset credits for ammonia control, and expanded net metering policies to provide revenue for the sale of electricity generated from captured methane gas. Individually, any of these policies appears to be sufficient to provide the economic incentive for farm operators to reduce emissions. We report on initial steps to fully develop the integrated process model that will provide guidance for policymakers.
    Keywords: methane, ammonia, carbon dioxide, greenhouse gases, climate change, offset, particulate matter, net metering, environmental policy, CAFO, manure management, biodigester, electricity, global warming, cost-benefit, incentive approach
    JEL: Q2 Q4 Q53
    Date: 2006–03–14

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