nep-agr New Economics Papers
on Agricultural Economics
Issue of 2007‒03‒31
fifteen papers chosen by
Angelo Zago
University of Verona

  1. Securing Household Income among Small-scale Farmers in Kakamega District: Possibilities and Limitations of Diversification By Henriette Dose
  2. Returns to Investment in Agriculture By Steven Haggblade
  3. Appraising Agricultural Greenhouse Gas Mitigation Potentials: Effects of Alternative Assumptions By Uwe A. Schneider; Bruce A. McCarl
  4. Consumer Demand for Quality: Major Determinant for Agricultural and Food Trade in the Future? By Julie A. Caswell; Siny Joseph
  5. Economic Aspects of Agricultural and Food Biosecurity in the United States By Hennessy, David A.
  6. Interrelationships of Animal Agriculture, the Environment, and Rural Communities By Hogberg, M. G.; Fales, S. L.; Kirschenmann, F. L.; Honeyman, M. S.; Miranowski, John; Lasley, P.
  7. Russia's New Agricultural Operators: Their Emergence, Growth and Impact By Rylko, Dmitri; Jolly, Robert W.
  8. Crop Rotation Effects on Soil Quality at Three Northern Corn/Soybean Locations By Karlen, D.; Hurley, E.; Andrews, S; Cambardella, C.; Meek, M.; Duffy, Michael; Mallarenio, A.
  9. What Works in Fighting Diarrheal Diseases in Developing Countries? A Critical Review By Alix Peterson Zwane; Michael Kremer
  10. The role of services in rural income : the case of Vietnam By Aksoy, M. Ataman; Isik-Dikmelik, Aylin
  11. Illegal Extractions of Renewable Resources and International Trade with Costly Enforcement of Property Rights By JINJI Naoto
  12. An Ordinal Regression Model using Dealer Satisfaction Data By Staus, Alexander
  13. Fisheries Management with Stock Growth Uncertainty and Costly Capital Adjustment By Singh, Rajesh; Weninger, Quinn; Doyle, Matthew
  14. The Effects of ITQ Management on Fishermen’s Welfare When the Processing Sector is Imperfectly Competitive By David M. McEvoy; Sylvia Brandt; Nathalie Lavoie; Sven Anders
  15. Can the Natural Resource Curse Be Turned Into a Blessing? The Role of Trade Policies and Institutions By Arezki, Rabah; van der Ploeg, Frederick

  1. By: Henriette Dose (Institute of African Studies, University of Leipzig)
    Abstract: In the debate of sustainable rural livelihoods, diversification is seen as a way to secure incomes and to increase food security. On the basis of a data set on income security, this paper analyses to what extent this applies to small-scale farmers in Kakamega District, Kenya. Using the sustainable rural livelihoods approach, this paper draws the conclusion, that (1) diversification in agricultural production is not sufficient for securing rural livelihoods in Kakamega District; (2) a sufficient income diversification depends heavily on requirements like access to education, infrastructure, as well as investment capital; and (3) small-scale farmers in Kakamega District in most cases lack these requirements, therefore not being able to achieve secure household incomes or increased food security.
    Keywords: agriculture, income security, small-scale farmers, Kenya, sustainable rural livelihoods (SRL), diversification
  2. By: Steven Haggblade (Department of Agricultural Economics, Michigan State University)
    Abstract: Investment in agriculture is necessary for ensuring rapid economic growth and poverty reduction in Zambia, as elsewhere in Africa. Yet many of the key investments required to accelerate agricultural growth – technological research, rural infrastructure and market standards, organization and enforcement -- are public goods. Because the private sector cannot capture gains from these investments, they will not invest in amounts sufficient to ensure broad-based agricultural growth. Therefore, the public sector needs to provide the necessary research, transport and market infrastructure necessary to stimulate agricultural growth. Zambia currently allocates 6% of government outlays for agriculture. This is less that the 10% commitment Zambia has made under the CAADP agreement and far less than the 15% spent by Asian countries at the launch of their Green Revolution. In allocating these funds, Zambia spends the majority of its discretionary agricultural budget on recurrent subsidies for private farm inputs, primarily fertilizer, while spending far less on rural infrastructure and technology development. Yet international evidence suggests that returns to private input subsidies are typically lower than returns to investments in public goods, in part because private input subsidies are prone to rent-seeking and in part because public input subsidies substitute for private financing of these private inputs. Investment in public goods such as agricultural research and extension, rural roads and irrigation typically produce returns two to six times greater than spending devoted to input subsidies. Therefore, a reorientation of public spending, away from private input subsidies and towards increased investment in public goods, would likely accelerate agricultural growth in Zambia.
    Keywords: food security, food policy, Zambia, agriculture growth, public investment
    JEL: Q19
    Date: 2007
  3. By: Uwe A. Schneider (Research unit Sustainability and Global Change, Hamburg); Bruce A. McCarl
    Keywords: Soil carbon sequestration, Sink dynamics, Mathematical programming, Land use, Optimization, Agriculture, Forestry, Greenhouse gas mitigation
    JEL: Q54
    Date: 2005–07
  4. By: Julie A. Caswell (Department of Resource Economics, University of Massachusetts Amherst); Siny Joseph (Department of Resource Economics, University of Massachusetts Amherst)
    Abstract: The impact of consumer demand for quality on the agricultural and food system is an increased emphasis on quality differentiation but not all in the direction of upgrading quality. The more elite market segments are thriving and reaching growing numbers of consumers but the basic price/quality markets remain strong. Most recent economic studies find that consumers are willing to pay for food safety and other quality attributes, and for information about them. The magnitude of the valuations varies by food product, attribute, country, and study design. This literature and a case study of genetically modified foods suggest that consumer demand has a strong effect on agricultural and food trade.
    Keywords: food quality, food safety, consumer demand, willingness to pay, international trade
    JEL: D12 L15 Q18
  5. By: Hennessy, David A.
    Abstract: Concerns about biosecurity in the food system raise a variety of issues about how the system is presently organized, why it might be vulnerable, what one could reasonably do to better secure it, and the costs of doing so. After presenting some facts about US agriculture and food, this paper considers three economic aspects of the general problem. One is the global problem, or the way biosecurity measures can affect how countries relate to each other and the global consequences that result. Another is how to best manage the immediate aftermath of a realized threat in order to minimize damage. The third is how to seek to prevent realization of the threat. Some policy alternatives are also presented.
    Keywords: agro-terrorism, animal disease, biosecurity, epidemic, food system policy.
    Date: 2007–03–29
  6. By: Hogberg, M. G.; Fales, S. L.; Kirschenmann, F. L.; Honeyman, M. S.; Miranowski, John; Lasley, P.
    Abstract: Animal agriculture is closely interrelated to both the natural environment and human systems, including rural communities. Accordingly, changes in animal agriculture can have wide-ranging consequences across many areas. During the past 50 yr, there has been tremendous change in animal agriculture, involving an increase in the size of production units, greater reliance on technology, a corresponding decrease in human labor, increased confinement of animals, and a general trend toward monoculture or specialized production systems. At least in part, these changes were brought about as a consequence of animal science research in nutrition, breeding, reproduction, growth, and so on. A long-term goal for animal scientists has been to increase the biological efficiency of animal-based food production, and the success in reaching this goal has been remarkable, with the time to market, growth rates, milk and egg production, etc., per animal increasing two- to threefold in some cases during the last 50 yr. The increase in the efficiency of animal agriculture has brought about a parallel decrease in food prices. Nonetheless, whereas animal science in one sense has been very successful, new questions or issues have emerged. The scale of animal systems today sometimes concentrates large numbers of animals into smaller areas that cannot handle the resultant animal manure. Stream and ground water pollution is increasingly a concern in some regions. Odor is a nuisance problem that increasingly places neighbors and urban growth in conflict with confinement animal systems. Possibly one of the biggest issues can be stated in terms of sustainability: Can all current food animal production systems continue as they currently exist? Additionally, the decrease in the number of producers has affected rural communities, and in some cases has brought about the demise of small towns. Animal scientists typically contend that they serve the interests of producers and strive to promote practices that are environmentally sound. Bringing about a discussion among animal scientists as to whether these goals are always met, or could be better met, is important if both the industry and our rural communities are to survive and thrive.
    Keywords: Animal Agriculture, Environment, Rural Communities
    Date: 2006–05–16
  7. By: Rylko, Dmitri; Jolly, Robert W.
    Abstract: Data from case studies, interviews, and surveys are used to explore the emergence, growth, and likely consequences of new agricultural operators (NAOs) in Russia. NAOs or agroholdings are very large farming operations averaging more than 50,000 ha, which are externally owned and managed. Entry motives and patterns vary widely, but most NAOs are responding to real profit opportunities. They bring with them the means to overcome market and institutional imperfections, as well as limitations in human and physical capital. However, there is a real risk they may lead to the creation of Russian latifundia to the possible detriment of the rural population.
    Keywords: Russian agriculture, transition economies, agroholdings, farm structure, latifundia, farm consolidation, vertical integration, diversification
    Date: 2006–05–31
  8. By: Karlen, D.; Hurley, E.; Andrews, S; Cambardella, C.; Meek, M.; Duffy, Michael; Mallarenio, A.
    Abstract: This paper examines how three different rotations effect on soil quality and profitability.
    Date: 2006–04–05
  9. By: Alix Peterson Zwane; Michael Kremer
    Abstract: The Millennium Development Goals call for reducing by half the proportion of people without sustainable access to safe drinking water. This goal was adopted in large part because clean water was seen as critical to fighting diarrheal disease, which kills 2 million children annually. There is compelling evidence that provision of piped water and sanitation can substantially reduce child mortality. However, in dispersed rural settlements, providing complete piped water and sanitation infrastructure to households is expensive. Many poor countries have therefore focused instead on providing community-level water infrastructure, such as wells. Various traditional child health interventions have been shown to be effective in fighting diarrhea. Among environmental interventions, handwashing and point-of-use water treatment both reduce diarrhea, although more needs to be learned about ways to encourage households to take up these behavior changes. In contrast, there is little evidence that providing community-level rural water infrastructure substantially reduces diarrheal disease or that this infrastructure can be effectively maintained. Investments in communal water infrastructure short of piped water may serve other needs and may reduce diarrhea in particular circumstances, but the case for prioritizing communal infrastructure provision needs to be made rather than assumed.
    JEL: O22 Q52 Q56
    Date: 2007–03
  10. By: Aksoy, M. Ataman; Isik-Dikmelik, Aylin
    Abstract: This paper investigates the role of services in the household response to trade reforms in Vietnam. The relative response of the households and income growth after a major trade liberalization in rice are analyzed aiming to answer the following questions: What type of households, in which locations, having access to what type of services, benefited more from the reforms? It focuses on services that have an impact on transaction costs (roads or quality of roads, public transportation, access to credit, extension services, and availability of markets in communication services) because transaction costs are often cited as a barrier to rural households in responding to the price changes and increased incentives offered by trade and other policy reforms. The results suggest that availability of production related services contributes positively to the impact of trade reforms. Although most of the service variables have a positive and significant effect on growth in income, some that are expected to have an impact are not significant. This may be explained by the exceptional coverage of infrastructure services in Vietnam even before the reforms. When service availability is very similar across different localities, household characteristics become more important in determining the response.
    Keywords: Transport Economics Policy & Planning,Rural Poverty Reduction,Economic Theory & Research,Housing & Human Habitats
    Date: 2007–03–01
  11. By: JINJI Naoto
    Abstract: Illegal extractions of renewable resources threaten sustainable use of those resources. The world community has recently paid increasing attention to the issue of illegal logging. This paper tries to explain why it is important to exclude illegally logged timber from the international market by using a stylized model in the literature of trade and renewable resources. It is shown that a fall in the price of timber may cause a switch of management regime from enforced property rights to open-access, expanding the supply of timber and reducing forest stock. When several countries export timber, an increase in illegal logging in one country due to a regime switch may also increase illegal logging in other countries. While conflicting with the GATT/WTO rules for reasons of discrimination by process and production methods (PPMs), import restrictions only on illegally logged timber will be effective to prevent the international diffusion of illegal logging.
    Date: 2007–03
  12. By: Staus, Alexander
    Abstract: This article anylyses dealer satisfaction data in the agricultural technology market in Germany. An ordinal regression model is used to analyse the ordinal scaled rating of the dealers. Since the estimated coefficients of an ordinal regression model can't be properly interpreted we show other methods for a better insight of the relationship of the dealer satisfaction and the influencing variables.
    Keywords: ordinal regression; dealer satisfaction; interpretation
    JEL: C51 Q13 C25
    Date: 2007–03–28
  13. By: Singh, Rajesh; Weninger, Quinn; Doyle, Matthew
    Abstract: We develop a dynamic model of a fishery which simultaneously incorporates random stock growth and costly capital adjustment. Numerical techniques are used to solve for the resource-rent-maximizing harvest and capital investment policies. Capital rigidities bring diminishing marginal returns to the current period harvest, and introduce an incentive to smooth the catch over time. With density dependent stock growth, however, catch smoothing increases stock variability resulting in reduced average yields. The optimal management policy balances the catch smoothing benefits against yield loss. We calibrate the model to the Alaskan pacific halibut fishery to demonstrate the main insights.
    Keywords: Stochastic growth; Costly capital adjustment; Pacific halibut fishery
    JEL: D2 Q2
    Date: 2007–03–23
  14. By: David M. McEvoy (Department of Resource Economics, University of Massachusetts Amherst); Sylvia Brandt; Nathalie Lavoie (Department of Resource Economics, University of Massachusetts Amherst); Sven Anders (Department of Rural Economy, University of Alberta Edmonton)
    Abstract: In this paper we use a general model of imperfect competition to predict welfare changes within an open-access fishery transitioning to individual transferable quota (ITQ) management. Although related research has explored the effects of market power in the harvesting sector on ITQ performance, none have considered the implications of an imperfectly competitive processing sector. This study addresses this question specifically in the context of the Atlantic herring fishery, although its implications are relevant to all fisheries with similar industry structure. Our results show that ITQs could have a negative impact on fishermen’s welfare when processors have market power and the cap on aggregate harvest is binding or becomes binding with the implementation of ITQs.
    Keywords: ITQ, imperfect competition, welfare analysis, fisheries
    JEL: D43 Q22 Q28 L13
  15. By: Arezki, Rabah; van der Ploeg, Frederick
    Abstract: We criticize existing empirical results on the detrimental effects of natural resource dependence on the rate of economic growth after controlling for institutional quality, openness, and initial income. These results do not survive once we use instrumental variables techniques to correct for the endogenous nature of the explanatory variables. Furthermore, they suffer from omitted variables bias as they overestimate the effect of initial income per capita and thus underestimate the speed of conditional convergence. Instead, we provide new evidence for the impact of natural resource dependence on income per capita in a systematic empirical cross-country framework. In addition to a significant negative direct impact of natural resources on income per capita, we find a significant indirect effect of natural resources on institutions. We allow for interaction effects and provide evidence that the natural resource curse is particularly severe for economic performance in countries with a low degree of trade openness. Adopting policies directed toward more trade openness may thus soften the impact of a resource curse. We also check the robustness of our results by using a variety of instruments and also employing the ratio of natural capital rather than natural resource exports to national income as an explanatory variable. We find evidence that resource abundance, measured by the stock of natural capital, also induces a resource curse, but less severely for countries that are relatively open.
    Keywords: growth performance; income per capita; institutions; resource curse; trade policies
    JEL: C21 C82 O11 O41
    Date: 2007–03

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