nep-agr New Economics Papers
on Agricultural Economics
Issue of 2006‒10‒07
eleven papers chosen by
Angelo Zago
Universita degli Studi di Verona

  1. Distributional Effects of WTO Agricultural Reforms in Rich and Poor Countries By Hertel, Thomas; Keeney, Roman; Ivanic, Maros; Winters, Alan
  2. The role of agriculture in poverty reduction an empirical perspective By Christiaensen, Luc; Demery, Lionel; Kuhl, Jesper
  3. Klum@Gtap: Introducing Biophysical Aspects of Land-Use Decisions Into a General Equilibrium Model A Coupling Experiment By Kerstin Ronneberger; Maria Berrittella; Francesco Bosello; Richard S.J. Tol
  4. Water Infrastructures Facing Sustainable Development Challenges: Integrated Evaluation of Impacts of Dams on Regional Development in Morocco By Paola Minoia; Anna Brusarosco
  5. Preserving Biodiversity: Ambiguity and Safety Rules By Giannis Vardas; Anastasios Xepapadeas
  6. L'agriculture périurbaine, une proximité ville agriculture à construire By Nathalie Bertrand; Nicole Rousier
  7. A Future for the Dead Sea Basin: Water Culture among Israelis, Palestinians and Jordanians By Clive Lipchin
  8. Measuring Technical Efficiency under Factor Non-Substitution: A Stochastic von Liebig Crop Response Model By Margarita Genius; Maria Mavraki; Vangelis Tzouvelekas
  9. Economic Valuation of Oceanographic Forecasting Services: A Cost-Benefit Exercise By Aline Chiabai; Paulo A.L.D. Nunes
  10. Experienced and Novice Investors: Does Environmental Information Influence on Investment Allocation Decisions? By Holm, Claus; Rikhardsson, Pall
  11. Spending Natural Resource Revenues in an Altruistic Growth Model By Elisabeth Hermann Frederiksen

  1. By: Hertel, Thomas; Keeney, Roman; Ivanic, Maros; Winters, Alan
    Abstract: Rich countries’ agricultural trade policies are the battleground on which the future of the WTO’s troubled Doha Round will be determined. Subject to widespread criticism, they nonetheless appear to be almost immune to serious reform, and one of their most common defenses is that they protect poor farmers. Our findings reject this claim. The analysis conducted here uses detailed data on farm incomes to show that major commodity programs are highly regressive in the USA, and that the only serious losses under trade reform are among large, wealthy, farmers in a few heavily protected subsectors. In contrast, analysis using household data from fifteen developing countries indicates that reforming rich countries’ agricultural trade policies would lift large numbers of developing country farm households out of poverty. In the majority of cases these gains are not outweighed by the poverty-increasing effects of higher food prices among other households. Agricultural reforms that appear feasible, even under an ambitious Doha Round, achieve only a fraction of the benefits for developing countries that full liberalization promises, but protects US large farms from most of the rigors of adjustment. Finally, the analysis conducted here indicates that maximal trade-led poverty reductions occur when developing countries participate more fully in agricultural trade liberalization.
    Date: 2006
  2. By: Christiaensen, Luc; Demery, Lionel; Kuhl, Jesper
    Abstract: The relative contribution of a sector to poverty reduction is shown to depend on its direct and indirect growth effects as well as its participation effect. The paper assesses how these effects compare between agriculture and non-agriculture by reviewing the literature and by analyzing cross-country national accounts and poverty data from household surveys. Special attention is given to Sub-Saharan Africa. While the direct growth effect of agriculture on poverty reduction is likely to be smaller than that of non-agriculture (though not because of inherently inferior productivity growth), the indirect growth effect of agriculture (through its linkages with nonagriculture) appears substantial and at least as large as the reverse feedback effect. The poor participate much more in growth in the agricultural sector, especially in low-income countries, resulting in much larger poverty reduction impact. Together, these findings support the overall premise that enhancing agricultural productivity is the critical entry-point in designing effective poverty reduction strategies, including in Sub-Saharan Africa. Yet, to maximize the poverty reducing effects, the right agricultural technology and investments must be pursued, underscoring the need for much more country specific analysis of the structure and institutional organization of the rural economy in designing poverty reduction strategies.
    Keywords: Rural Poverty Reduction,Pro-Poor Growth and Inequality,Economic Theory & Research,Rural Development Knowledge & Information Systems
    Date: 2006–09–01
  3. By: Kerstin Ronneberger (Deutsches Klimarechenzentrum GmbH); Maria Berrittella (University of Palermo); Francesco Bosello (Fondazione Eni Enrico Mattei and International Centre for Theoretical Physics); Richard S.J. Tol (Princeton University, Vrije Universiteit and Hamburg University)
    Abstract: In this paper the global agricultural land use model KLUM is coupled to an extended version of the computable general equilibrium model (CGE) GTAP in order to consistently assess the integrated impacts of climate change on global cropland allocation and its implication for economic development. The methodology is innovative as it introduces dynamic economic land-use decisions based also on the biophysical aspects of land into a state-of-the-art CGE; it further allows the projection of resulting changes in cropland patterns on a spatially more explicit level. A convergence test and illustrative future simulations underpin the robustness and potentials of the coupled system. Reference simulations with the uncoupled models emphasize the impact and relevance of the coupling; the results of coupled and uncoupled simulations can differ by several hundred percent.
    Keywords: Land-Use Change, Computable General Equilibrium Modeling, Integrated Assessment, Climate Change
    JEL: C68 Q15
    Date: 2006–08
  4. By: Paola Minoia (Università Ca’ Foscari di Venezia); Anna Brusarosco (Università Ca’ Foscari di Venezia)
    Abstract: During the past century, large hydraulic infrastructures have been considered as the most effective tools for increasing water supply and rationalise water management. According to this approach, large infrastructures are seen as catalysts for territorial development and economic progress. More recently, international surveys of results of water supply policies and performances of large dams, show that these structures need to be integrated in more comprehensive Integrated Water Resource Management strategies at catchments’ scale, to promote equitable and sustainable regional development. The aim of this communication is to present the role of large hydraulic infrastructures within the regional development dynamics with particular attention to the Sebou basin in Morocco, in order to assess some relevant impacts on local communities and their ecosystems. The Sebou region is one of the most important basins in Morocco, in the context of the national strategies and policies of management of water resources, established by the Water Law of 1995. The development of hydraulic infrastructures in the Sebou Basin begun in 1935, with construction of a complex of ten large dams and nine small dams, to provide water for agriculture, domestic and industrial use, and to generate hydropower and control floods, in line with the national water policies that, from the 1960s onwards, looked at large dams as core infrastructures for regional development. A critical view will be given about the coherence of this strategy with the sustainability principles.
    Keywords: Water Policy, Morocco, Dams, Sustainable Development, Impacts
    JEL: Q25 Q28
    Date: 2006–08
  5. By: Giannis Vardas (Department of Economics, University of Crete); Anastasios Xepapadeas (Department of Economics, University of Crete)
    Abstract: Safety rules are developed, for biodiversity preservation. These rules are designed to take into account the impact of uncertainty and worst case scenarios, which when combined with unregulated ecosystem management decisions, might produce extinction of species. The safety rules take the form of fixed land allocation and fixed harvesting rules under uncertainty. We explore how model uncertainty affects these safety rules relative to the classic risk aversion case and how a measure of precaution against worst case scenarios can be formulated.
    Keywords: Biodiversity Preservation, Model Uncertainty, Safety Rules
    JEL: Q57
    Date: 2006–03–11
  6. By: Nathalie Bertrand (DTGR - Développement des territoires montagnards - [CEMAGREF]); Nicole Rousier (LEPII - Laboratoire d'Economie de la Production et de l'Intégration Internationale - [CNRS : FRE2664] - [Université Pierre Mendès-France - Grenoble II])
    Abstract: Cette communication qui s'appuie sur l'analyse de la Région Urbaine Grenobloise s'interroge dans un premier temps sur la spécificité éventuelle de l'agriculture périurbaine, en termes de productions et de commercialisation (circuits courts), c'est-à-dire sur l'impact de la proximité géographique de la ville dans le rapport secteur agricole-territoires. La très grande diversité des stratégies des exploitants, les stratégies de niches, l'éclatement sur l'espace de ceux qui pratiquent les nouvelles fonctionnalités, rendent difficiles les actions collectives au niveau local sur des problèmes productifs agricoles. De telles dynamiques semblent plus relever d'une mobilisation du milieu professionnel agricole sur des projets de développement urbain. L'émergence de nouvelles organisations et les proximités institutionnelles entre agriculteurs et élus seront analysées dans un deuxième temps.
    Keywords: agriculture périurbaine ; ville ; territoire ; agriculture ; développement urbain ; développement territorial ; France ; Grenoble
    Date: 2006–10–02
  7. By: Clive Lipchin (Arava Institute For Environmental Studies)
    Abstract: The Dead Sea basin plays a major role for regional economic development (industry, tourism and agriculture) in the Middle East. This potential is threatened by the steady disappearance of the Dead Sea. Since around 1930 the water level of the Dead Sea has fallen by about 25 m, about half of this alone in the last 20 years. The Dead Sea is a transboundary resource shared by Israel, the Palestinian Authority and Jordan. The Dead Sea is the terminal point of the Jordan River watershed and as such, it serves as a barometer for the health of the overall system. Its rapid decline reflects the present water management strategies of the riparian and upstream countries. This includes the different water cultures of the three countries. Throughout history, the Dead Sea basin has served as a source of refuge and inspiration for followers of Judaism, Christianity and Islam. Today, the religious significance of the Dead Sea is being overshadowed by its rapid disappearance. This may be explained in part by the water cultures of the three countries that influence water policy in the region. Ideology, together with culture and tradition, such as that of Zionism in Israel, has played a central role in water development in the region. In many cases, this has been at the expense of the environment. Elements pertaining to environmental security and water culture and tradition, whereby a sustainably managed environment provides for social, economic as well as environmental benefits are evident with regards the Dead Sea. The decline for example, undermines its potential as a tourist destination, despite the enormous investment in hotel and resort infrastructures in Israel and in Jordan. The decline also raises ethical issues about the exploitation of water resources by present generations at the expense of this natural heritage to future generations. This paper provides an analysis of a European Union funded project whose aims are to synthesize and assess existing physical and socio-economic data and to assess options for a better future for the Dead Sea. It will identify the patterns of water supply and use in the region, and the factors that control these patterns, including those of water culture. The underlying assumption is that solutions for a more sustainable development than today’s scenario will not come from simply providing "more water for more development", but from a new land and water management system, indeed ethic, that is sensitive to social, cultural and ecological resources thereby providing security and stability across cultures, economic sectors and nations.
    Keywords: Water Culture, Dead Sea, Stakeholder Analysis
    JEL: Q25 Q56 Q58
    Date: 2006–09
  8. By: Margarita Genius (Department of Economics, University of Crete); Maria Mavraki (Department of Economics, University of Crete); Vangelis Tzouvelekas (Department of Economics, University of Crete)
    Abstract: The present paper develops an econometric model for measuring input-oriented technical efficiency when the underlying technology is characterized by the lack of substitution between inputs. In this instances, Farrell’s radial measure of technical inefficiency is inappropriate as it may be possible to identify a technical inefficient bundle as technical efficient. Instead Russell’s non-radial indices can adequately measure technical inefficiency in factor limitation models. To this end, a disequilibrium model augmented with a regime specific technical inefficiency term is proposed and its likelihood function derived together with the computation of technical efficiency under specific distributional assumptions. The framework under which the model is proposed is the well known von Liebig hypothesis that analyses crop response to different levels of fertilizer nutrients. Application of the proposed stochastic von Liebig crop response model to the experimental data of Heady and Pesek (1954) points out to the fact that technical inefficiency can arise for a subset of the nutrients considered.
    Date: 2006–03
  9. By: Aline Chiabai (Fondazione Eni Enrico Mattei); Paulo A.L.D. Nunes (Fondazione Eni Enrico Mattei)
    Abstract: This paper provides an assessment of the economic value of the oceanographic services provided by the Mediterranean operational forecasting system, MFSTEP. The main purpose of this exploratory study is to carry out a cost-benefit analysis for different development scenarios, by comparing the costs associated with the project implementation with the private benefits that arise from delivering its products on the market. As far as the costs are concerned, a total cost assessment has been performed by identifying, classifying and estimating the wide range of inputs that have been allocated both to the project development and maintenance. Against this context, a cost questionnaire has been designed and administered to all MFSTEP partners. In addition, the study focuses on an end-users analysis in order to examine end-users’ attitudes and interests for the forecasting products, their needs and satisfaction. As before, we make the use of a survey. Finally, this questionnaire is characterized by exploring the use of the contingent valuation approach so as to address and estimate the private benefits derived from the provision of the MFSTEP products. Estimation results show that the mean willingness to pay for accessing the forecasting products amounts to 65 euro per download. Cost-benefit analysis reveals that, from a market perspective relying on the profit maximisation, a total of 163 downloads per day are required for total maintenance costs recovery, whereas 90 downloads per day are required to recover personnel maintenance costs. Finally, 33 downloads per day are required so as to recover durable equipment maintenance costs.
    Keywords: Cost-Benefit Analysis, Contingent Valuation, Survey Design, Willingness to Pay, Cost Assessment, Observing and Modelling Oceanographic System
    JEL: D60 D61 D12
    Date: 2006–08
  10. By: Holm, Claus (Department of Management Science and Logistics, Aarhus School of Business); Rikhardsson, Pall (Department of Management Science and Logistics, Aarhus School of Business)
    Abstract: This paper examines the effect of environmental information on the investment <p> decisions of investors. The motivation for the experimental design <p> applied in this study is that unless actual decision making is observed, <p> the potential usefulness of environmental information (or lack <p> thereof) cannot be taken for granted. The study is based on an experiment <p> where groups of investors (varied by experience) were asked to <p> make investment allocation decisions based on financial information and <p> on supplementary environmental information (varied between cases). As <p> an investment allocation decision (varied by investment horizons) the <p> groups were asked to allocate funds to two companies based on the available <p> information. The findings suggest that environmental information has <p> the potential to influence investment allocation decisions. The findings <p> also suggest that the influence of environmental information on investment <p> allocation decisions is mitigated by the variables considered explicitly <p> in this study, i.e., the investment horizon (varied as short and long) <p> and investor experience (varied as novice and experienced investor). It is <p> concluded that because allocation decisions are multifaceted problems, <p> mixed results related to the influence of environmental information should <p> be expected
    Keywords: Environmental reporting; Environmental disclosures; Allocation; Decision making; Investment horizon; Investors; Experiment;
    Date: 2006–06–14
  11. By: Elisabeth Hermann Frederiksen (Department of Economics, University of Copenhagen)
    Abstract: This paper examines how revenues from a natural resource interact with growth and welfare in an overlapping generations model with altruism. The revenues are allocated between public productive services and direct transfers to members of society by spending policies. We analyze how these policies influence the dynamics, and how the dynamics are influenced by the abundance of the revenue. Abundant revenues may harm growth, but growth and welfare can be oppositely affected. We also provide the socially optimal policy. Overall, the analysis suggests that variation in the strength of altruism and in spending policies may be part of the reason why natural resources seem to affect economic performance across nations differently.
    Keywords: natural resources; economic growth; welfare; altruism
    JEL: D64 O41 Q33 Q38
    Date: 2006–09

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