New Economics Papers
on Agricultural Economics
Issue of 2009‒01‒10
34 papers chosen by

  1. The Economic Impact of Forest Hydrological Services on Local Communities: A Case Study from the Western Ghats of India By SHARACHCHANDRA LELE
  2. Long-term Global Agricultural Output Supply-Demand Balance and Real Farm and Food Prices By Tweeten, Luther; Thompson, Stanley R.
  3. Accelerating Africa's food production in response to rising food prices: Impacts and requisite actions By Diao, Xinshen; Fan, Shenggen; Headey, Derek; Johnson, Michael; Nin Pratt, Alejandro; Yu, Bingxin
  4. Higher fuel and food prices: Economic impacts and responses for Mozambique By Arndt, Channing; Benfica, Rui; Maximiano, Nelson; Nucifora, Antonio M.D.; Thurlow, James
  5. Linkages between land management, land degradation, and poverty in Sub-Saharan Africa: The case of Uganda By Nkonya, Ephraim; Pender, John; Kaizzi, Kayuki C.; Kato, Edward; Mugarura, Samuel; Ssali, Henry; Muwonge, James
  6. Finding Missing Markets (and a disturbing epilogue): Evidence from an Export Crop Adoption and Marketing Intervention in Kenya By Nava Ashraf; Xavier Giné; Dean Karlan
  7. Do Consumers Really Care about Biotech Food Label? By Chen, Xi; Zhong, Funing; Zhou, Bin
  8. Global carbon markets: Are there opportunities for Sub-Saharan Africa? By Bryan, Elizabeth; Akpalu, Wisdom; Yesuf, Mahmud; Ringler, Claudia
  9. Sustaining and accelerating Africa's agricultural growth recovery in the context of changing global food prices: By Badiane, Ousmane
  10. Food and financial crises: Implications for agriculture and the poor By von Braun, Joachim
  11. It's a small world after all: Defining smallholder agriculture in Ghana By Chamberlin, Jordan
  12. The Philippines: Shadow WTO Agricultural Domestic Support Notifications By Cororaton, Caesar B.
  13. The impact of climate change and adaptation on food production in low-income countries: Evidence from the Nile Basin, Ethiopia By Yesuf, Mahmud; di Falco, Salvatore; Deressa, Temesgen; Ringler, Claudia; Kohlin, Gunnar
  14. United States: Shadow WTO Agricultural Domestic Support Notifications By Blandford, David; Orden, David
  15. A Risk Analysis of Converting CRP Acres to a Wheat-Sorghum-Fallow Rotation By Williams, Jeffery R.; Llewelyn, Richard V.; Pendell, Dustin L.; Schlegel, Alan; Troy, Dumler
  16. Rainfall Shocks, Markets, and Food Crises: Evidence from the Sahel By Jenny Aker
  17. The impact of Ethiopia's Productive Safety Net Programme and its linkages: By Gilligan, Daniel O.; Hoddinott, John; Taffesse, Alemayehu Seyoum
  18. Migration and technical efficiency in cereal production: Evidence from Burkina Faso By Wouterse, Fleur S.
  19. Rural finance reform in China By Chen Xiang Liu
  20. Accelerating innovation with prize rewards: History and typology of technology prizes and a new contest design for innovation in African agriculture By Masters, William A.; Delbecq, Benoit
  21. An Examination of the Relationship between Food Prices and Government Monetary Policies in Iran By Shahnoushi, Naser; Henneberry, Shida; Manssori, Hooman
  22. The impact of agricultural extension and roads on poverty and consumption growth in fifteen Ethiopian villages: By Dercon, Stefan; Gilligan, Daniel O.; Hoddinott, John; Woldehan, Tassew
  23. Japan: Shadow WTO Agricultural Domestic Support Notifications By Godo, Yoshihisa; Takahashi, Daisuke
  24. Anatomy of a crisis: The causes and consequences of surging food prices By Headey, Derek; Fan, Shenggen
  25. The future of global sugar markets: Policies, reforms, and impact By Bureau, Jean-Christophe; Gohin, Alexandre; Guindé, Loïc; Millet, Guy; Brandão, Antônio Salazar P.; Haley, Stephen; Wagner, Owen; Orden, David; Sandrey, Ron; Vink, Nick
  26. Carcass Quality Volume and Grid Pricing: An Investigation of Cause and Effect By Fausti, Scott; Qasmi, Bashir; Li, Jing
  27. Evaluating the impact of social networks in rural innovation systems: An overview By Matuschke, Ira
  28. A Foot and Mouth Disease Induced Model of US Excess Supply of Beef By Yeboah, Osei-Agyeman; Ofori-Boadu, Victor; Salifou, Samaila
  29. Making Retail Supply Chains Sustainable: Upgrading Opportunities for Developing Country Suppliers under Voluntary Quality Standards By Wijk, J.C.A.C. van; Danse, M.; Tulder, R.J.M. van
  31. Income Distribution Effects of EU Rural Development Policies: The Case of Farm Investment Support By Pavel Ciaian; Tomáš Ratinger
  32. Does Fertilizer Use Respond to Rainfall Variability? Panel Data Evidence from Ethiopia By Alem, Yonas; Bezabih, Mintewab; Kassie, Menale; Zikhali, Precious
  33. The net contribution of the Agri-Food Sector to the inflow of funds into Ireland: a new estimate By Riordan, Brendan
  34. Trade and the Environment By Lopez, Ramon; Islam, Asif

    Abstract: Building upon a larger research project at four sites in the Western Ghats of peninsular India, this study examines the link between stream flow, agricultural water use and economic returns to agriculture. The study attempts to simulate the likely impacts of regeneration of a degraded forest catchment on stream flow and the consequent impact on irrigation tankbased agriculture in a downstream village.
    Keywords: India, agricultural water, irrigation, agriculture, catchment, research, crop, governance, ecologically, environmentally, crops, western ghats, forest, village, agriculture, india,
    Date: 2009
  2. By: Tweeten, Luther; Thompson, Stanley R.
    Abstract: Global food demand is estimated from population projections of the United Nations and food supply is projected from Food and Agriculture Organization yield data to quantify the global food supply-demand balance for 2025 and 2050. The eight food categories examined account for 95 percent of global food consumption. Results indicate that the historic era of secularly falling real food prices is over. The real price of corn, for example, is not expected to fall over the next four decades at the annual rate of 1.3 percent that it fell annually from 1960 to 2006. The analysis foresees future real food prices fluctuating around a flat or rising trend. Slowed national economic growth from flat or rising real food prices may be little more than an irritant for consumers in affluent countries, but will entail severe hardship for consumers in the many countries currently troubled by poverty and hunger. Opportunities exist to expand food output by adding cropland in Brazil and irrigation in Africa, for example, but in the long term such developments will be offset by cropland removed from production by urban and industrial development, soil degradation, and the like. Although cropland can be expanded through higher real farm and food prices, higher yields rather than added cropland offer the most attractive opportunities for farm output expansion at low cost to consumers and the environment. The slowing rate of increase in crop and livestock yields corresponds with a slowing rate of increase in public and in private agricultural research and development spending. The world will not have the luxury of curtailing spending on agricultural technology and rejecting promising technologies such as genetically modified organisms (GMOs) if is to keep real food costs from rising. Productive new cropland, irrigation, genetically modified varieties, and other technologies will be hard pressed indeed to match the massive historic gains from hybrid varieties, irrigation, synthetic fertilizers, and mechanization. On the demand side, subsidies to expand demand for farming resources such as biofuels will need revisiting if rising food costs are to be contained.
    Keywords: World Food Supply-Demand, Food Prices, Agricultural Markets, Crop and Livestock Yields, Agricultural and Food Policy, Demand and Price Analysis, International Development, Q11, Q18,
    Date: 2008–12
  3. By: Diao, Xinshen; Fan, Shenggen; Headey, Derek; Johnson, Michael; Nin Pratt, Alejandro; Yu, Bingxin
    Abstract: "In Africa the global food crisis threatens the livelihoods of millions of people who because of high rates of poverty, hunger, malnutrition, and food dependency are already exceptionally vulnerable. In better circumstances, Africa's agricultural sector would respond to rising prices by increasing food supply. But such a response is impossible without significant new policy actions on both the production and marketing of African agriculture. This paper assesses the likely impacts of two strategic policy options: doubling African staples production, and improving “market access” through regional integration and lowering transaction costs. Using an economywide multimarket model for 17 African economies and econometrically estimated parameters describing the relationships between growth and poverty and between public spending and growth, we assess the impacts of these two strategic options on Africa's food markets and its broader economic development. Doubling staples production significantly increases food security, reduces consumer food prices by roughly 25 percent, reduces producer prices by 10 percent (thus raising farm revenue), accelerates agricultural growth rates, facilitates broader economic growth through new agroprocessing and export opportunities, and lifts more than 100 million Africans out of poverty. Key policy actions are needed to move from this strategic vision to implementation. The first set of actions requires investing $38 billion from 2009 to 2013, or $7.5 billion per year, in a well-designed package of modern agricultural inputs and provisions. The second requires improving and extending transport infrastructure, especially major transport corridors and rural feeder roads. The third requires reducing tra*de barriers, which still remain much higher in agriculture than in other sectors. All of these actions are technically and financially feasible, but their timely implementation requires urgent initiatives by both national and international policymakers." from authors' abstract
    Keywords: Food prices, Green Revolution, Staple foods, Agricultural productivity, Market access, infrastructure, economic modeling,
    Date: 2008
  4. By: Arndt, Channing; Benfica, Rui; Maximiano, Nelson; Nucifora, Antonio M.D.; Thurlow, James
    Abstract: "Rising world prices for fuel and food represent a negative terms-of-trade shock for Mozambique. The impacts of these price increases are analyzed using various approaches. Detailed price data show that the world price increases are being transmitted to domestic prices. Short-run net benefit ratio analysis indicates that urban households and households in the southern region of the country are more vulnerable to food price increases. Rural households, particularly in the northern and central parts of Mozambique, often benefit because they sell more food goods than they consume (i.e., net seller). Long-term analysis using a computable general equilibrium model of Mozambique indicates that the fuel price shock dominates rising food prices from both macroeconomic and poverty perspectives. Here again, negative impacts are greater in urban areas than in rural areas. The importance of agricultural production response in general, and export response in particular, are highlighted in this discussion. Policy analysis reveals difficult trade-offs between short-run mitigation and long-run growth. Improved agricultural productivity has powerful positive impacts, but remains difficult to achieve and may not address the immediate impacts of higher prices. " from authors' abstract
    Keywords: Price transmission, Terms-of-trade shocks, food security, Food prices, Development strategies,
    Date: 2008
  5. By: Nkonya, Ephraim; Pender, John; Kaizzi, Kayuki C.; Kato, Edward; Mugarura, Samuel; Ssali, Henry; Muwonge, James
    Abstract: "Agriculture is vital to the economies of Sub-Saharan Africa: two-thirds of the region's people depend on it for their livelihoods. Nevertheless, agricultural productivity in most of the region is stagnant or declining, in large part because of land degradation. Soil erosion and soil nutrient depletion degraded almost 70 percent of the region's land between 1945 and 1990; 20 percent of total agricultural land has been severely degraded. If left unchecked, land degradation could seriously threaten the progress of economic growth and poverty reduction in Africa. Within this context, most African countries strive to achieve poverty reduction and sustainable land management. In designing policies to achieve these objectives concurrently, a clear understanding of their linkage is crucial. Nonetheless, the relationships between poverty and land management are complex, context specific, and resource specific, and empirical evidence to demonstrate their linkage has been limited. This analysis seeks to improve the understanding of this linkage by examining how poverty (broadly defined to include limited access to capital, infrastructure, and services) influences land-management practices, land degradation, crop productivity, and household incomes. In particular, the study focuses on how factors susceptible to policy initiatives—such as education, agricultural technical assistance, and credit— affect households' land management decisions. Uganda was chosen to serve as a case study of these issues, for several reasons. Of all Sub-Saharan African nations, Uganda has some of the most severe soil nutrient depletion in Africa: about 1.2 percent of nutrient stock stored in the topsoil is depleted by farmers each year. Also, the country contains a wide variety of agroecological zones (AEZs), making it an appropriate microcosm of Sub-Saharan Africa. The Ugandan government has also been conducting ambitious poverty-reduction and conservation efforts, and a study such as this one serves to measure those efforts. Working with the Uganda Bureau of Statistics (UBOS), the authors drew on Uganda's 2002–03 National Household Survey, as well as a specific survey conducted to collect poverty, land management, and land-degradation data at the household and plot levels." from text
    Keywords: Poverty, Land management, Soil degradation,
    Date: 2008
  6. By: Nava Ashraf (Harvard Business School and Jameel Poverty Action Lab); Xavier Giné (The World Bank); Dean Karlan (Economic Growth Center, Yale University)
    Abstract: In much of the developing world, many farmers grow crops for local or personal consumption despite export options which appear to be more profitable. Thus many conjecture that one or several markets are missing. We report here on a randomized controlled trial conducted by DrumNet in Kenya that attempts to help farmers adopt and market export crops. DrumNet provides smallholder farmers with information about how to switch to export crops, makes in-kind loans for the purchase of the agricultural inputs, and provides marketing services by facilitating the transaction with exporters. The experimental evaluation design randomly assigns pre-existing farmer self-help groups to one of three groups: (1) a treatment group that receives all DrumNet services, (2) a treatment group that receives all DrumNet services except credit, or (3) a control group. After one year, DrumNet services led to an increase in production of export oriented crops and lower marketing costs; this translated into household income gains for new adopters. However, one year after the study ended, the exporter refused to continue buying the cash crops from the farmers because the conditions of the farms did not satisfy European export requirements. DrumNet collapsed in this region as farmers were forced to sell to middlemen and defaulted on their loans. The risk of such events may explain, at least partly, why many seemingly more profitable export crops are not adopted.
    Keywords: Field Experiment, Export Crop, Food Safety Standards
    JEL: O12 Q17 F13
    Date: 2008–12
  7. By: Chen, Xi; Zhong, Funing; Zhou, Bin
    Abstract: This paper is Selected for presentation at the Southern Agricultural Economics Association Annual Meeting, Atlanta, Georgia, January 31-February 3, 2009. The research is partially funded by ERS/USDA China Project and Social Science Fund of Jiangsu Province in China. The authors are grateful for comments from Dr. William Lin and Dr. Francis Tuan at ERS/USDA, and Prof. Loren Tauer at Cornell University. All errors are those of the authors.
    Keywords: biotech labeling, actual sales data, household survey data, Agribusiness, Agricultural and Food Policy, Consumer/Household Economics, Demand and Price Analysis, Food Consumption/Nutrition/Food Safety, Health Economics and Policy, International Development, International Relations/Trade, Marketing, Research and Development/Tech Change/Emerging Technologies, Risk and Uncertainty, Q13, Q17, Q18,
    Date: 2009
  8. By: Bryan, Elizabeth; Akpalu, Wisdom; Yesuf, Mahmud; Ringler, Claudia
    Abstract: "Global climate change poses great risks to poor people whose livelihoods depend directly on the use of natural resources. Mitigation of the adverse effects of climate change is a high priority on the international agenda. Carbon trading, under the Kyoto Protocol as well as outside the protocol, is growing rapidly from a small base and is expected to increase dramatically under present trends. However, developing countries, in particular Sub-Saharan Africa, remain marginalized in global carbon markets, with Africa's market share constituting less than 1 percent (excluding South Africa and North African countries). The potential for mitigation through agriculture in the African region is estimated at 17 percent of the global total, and the economic potential (i.e. considering carbon prices) is estimated at 10 percent of the total global mitigation potential. Similarly, Africa's forestry potential per year is 14 percent of the global total, and the avoided-deforestation potential accounts for 29 percent of the global total. Appropriate climate-change policies are needed to unleash this huge potential for pro-poor mitigation investment in Sub-Saharan Africa. Such policies should focus on increasing the profitability of environmentally sustainable practices that generate income for small producers and create investment flows for rural communities. Pro-poor investments, community development, new research, and capacity building can all help integrate the agriculture, forestry, and land-use systems of developing countries into the carbon trading system, both generating income gains and advancing environmental security. Achieving this result will require effective integration, from the global governance of carbon trading to the sectoral and micro-level design of markets and contracts, as well as investment in community management. Streamlining the measurement and enforcement of offsets, financial flows, and carbon credits for investors is also needed. This review paper begins with an overview of global carbon markets, including opportunities for carbon trading, and the current involvement of developing countries, with a focus on Sub-Saharan Africa. This is followed by an assessment of the mitigation potential and options involving agriculture, land use, and forestry. The major constraints to the participation of Sub-Saharan Africa in global carbon markets are discussed, and options for integrating the region into global carbon markets are proposed." from authors' abstract
    Keywords: Climate change, mitigation, carbon markets, Clean Development Mechanism,
    Date: 2008
  9. By: Badiane, Ousmane
    Abstract: "Starting in the mid-1990s, Africa embarked upon its longest period of sustained, positive per capita income growth since the 1960s. This growth recovery has made a dent in poverty and holds out hope that a number of African countries may reach the Millennium Development Goal targets for poverty and food security (MDG 1), if not by 2015, then within the following few years. Agricultural growth has been, and will remain, key to reducing poverty and hunger in Africa. To significantly reduce poverty, Africa needs to sustain, broaden, and accelerate its recent growth performance and boost its investments in agriculture. The recent spike in global food prices represents an opportunity that could support further agricultural sector growth in Africa. The unfolding financial crisis, on the other hand, could have the reverse effect, especially if it leads to lower investments in the sector." from author's abstract
    Keywords: Food prices, Agricultural growth, economic recovery, Development assistance,
    Date: 2008
  10. By: von Braun, Joachim
    Abstract: "High food prices from 2007 through mid-2008 had serious implications for food and nutrition security, macroeconomic stability, and political security. The unfolding global financial crisis and economic slowdown have now pushed food prices to lower levels. Yet the financial crunch has also decreased the availability of capital at a time when accelerated investment in agriculture is urgently needed. The food and financial crises will have strong and long-lasting effects on emerging economies and poor people. A synchronized response is needed to ease the burden on the poor and allow agriculture to face new challenges and respond to new opportunities. Three sets of complementary policy actions should be taken: (1) promote pro-poor agricultural growth, (2) reduce market volatility, and (3) expand social protection and child nutrition action. Agriculture requires strategic investment action, and the food-insecure poor need a bailout now." from Text
    Keywords: food security, Nutrition security, Pro-poor growth, Agricultural growth, Food prices, Social protection, Global financial crises,
    Date: 2008
  11. By: Chamberlin, Jordan
    Abstract: "Strategies for boosting the agricultural economies of developing countries usually focus on small farms, attempting, for example, to link smallholders with markets through production chain development. However, such strategies often fail to differentiate between different types of small farmers or to investigate the distribution of assets within the group—efforts that are important because unequal distributions of assets can restrict pro-poor growth. Further, strategies to develop production chains favor some small farmers over others (i.e., those already participating in targeted chains and those with relatively more productive assets). Using landholding size as an organizational filter, we performed a basic descriptive analysis of smallholder traits in Ghana, using data from the 2005–2006 Ghana Living Standards Survey (GLSS5). We found strong inequalities in landholding distributions within Ghana's small-farm sector in all regions of the country. Using a classification of smallholders we derived based on landholding size, we examined a variety of small-farm traits and found that many of the broadly perceived defining characteristics of smallholder agriculture—such as low input use and low market engagement—are negatively correlated with landholding size. The crowding of farms at the smaller end of the small-farm spectrum in Ghana suggests that rural development strategies based on expanding existing market chains will face challenges in connecting with the bulk of small producers, who are less well endowed than average statistics indicate." from authors' abstract
    Keywords: small farms, Smallholder production, Agricultural development,
    Date: 2008
  12. By: Cororaton, Caesar B.
    Abstract: "The objective of this paper is to review the agricultural trade and domestic policies of the Philippines and to provide an assessment of the types and levels of domestic support relative to the rules of the World Trade Organization (WTO). Changes in trade protection and support in the Philippines, including tariff structure, quantitative restrictions, and domestic support, are discussed and analyzed. The paper also discusses the pattern of public expenditure on agriculture in the Philippines, including major agricultural productivity-enhancing programs. The present structure of protection and support favors the agricultural sector. Trade protection is higher in agriculture relative to manufacturing. There is a quantitative restriction on rice imports and a tariff rate quota in several agricultural commodities. The green box payments and the special and differential treatment constitute the major domestic support for agriculture. These support payments are relatively substantial and will continue to be sizable in the future to support the government's food sufficiency policy. However, the trade-distorting market price support for rice and corn is significantly below the de minimis limit that applies to the Philippines under the WTO Uruguay Round Agreement on Agriculture." from author's abstract
    Keywords: Philippine agriculture, Agricultural support, WTO support, WTO compliance, Notification of domestic support, trade,
    Date: 2008
  13. By: Yesuf, Mahmud; di Falco, Salvatore; Deressa, Temesgen; Ringler, Claudia; Kohlin, Gunnar
    Abstract: "This paper presents an empirical analysis of the impact of climate change on food production in a typical low-income developing country. Furthermore, it provides an estimation of the determinants of adaptation to climate change and the implications of these strategies on farm productivity. The analysis relies on primary data from 1,000 farms producing cereal crops in the Nile Basin of Ethiopia. Based on monthly collected meteorological station data, the thin plate spline method of spatial interpolation was used to interpolate the specific rainfall and temperature values of each household. The rainfall data were disaggregated at the seasonal level. We found that climate change and climate change adaptations have significant impact on farm productivity. Extension services (both formal and farmer to farmer), as well as access to credit and information on future climate changes, affect adaptation positively and significantly. Farm households with larger access to social capital are more likely to adopt yield-related adaptation strategies." from authors' abstract
    Keywords: Adaptation, Climate change, farm level productivity, rainfall,
    Date: 2008
  14. By: Blandford, David; Orden, David
    Abstract: "This paper examines past and proposed U.S. domestic support in light of current and potential World Trade Organization (WTO) constraints. It provides a brief review of U.S. farm policies since the Uruguay Round WTO agreements went into effect, including a synopsis of the new Food, Conservation, and Energy Act of 2008. It examines the United States' notifications to the WTO of domestic support from 1995 to 2005 and provides a preliminary notification estimate for 2006. Green-box (non trade-distorting) expenditures for domestic nutrition programs dominate the total dollar values notified by the United States. The main notified components of the U.S. support policies for agricultural producers include fixed direct payments, disaster assistance, and environmental payments in the green box; market price supports for dairy and sugar and substantial price-linked, loan-rate-related subsidy expenditures in the product-specific aggregate measure of support (AMS) category; and non product-specific support notified as de minimis, including crop market loss assistance payments, countercyclical payments, and crop and revenue insurance subsidies. The United States' notification of total AMS has not exceeded the Uruguay Round commitment of $19.1 billion. It would have exceeded this amount in some years if the fixed direct payments were included in the AMS, an issue arising in challenges to the U.S. notifications. This paper discusses other subsidies that may be underreported, misclassified, or omitted, including the blender tax credits and mandates related to ethanol production that have been largely outside the disciplines of the Uruguay Round Agreement on Agriculture. It also provides an assessment of projected U.S. support through 2014. Under the Uruguay Round rules, there is essentially no constraint on U.S. policies if high prices projected in mid 2008 are realized. The WTO constraints are tighter if the proposed Doha Development Agenda disciplines of July 2008 are agreed upon. In that case, under the projected prices, the United States would still have some leeway to increase expenditures under its commitments. Thus, if the economic environment that is foreseen in the projections proves correct, the United States would be able to adapt to the proposed Doha Round domestic support modalities by making only modest adjustments in its policies, although product-specific support for sugar, cotton, or other products could face constraints. Large payments under a new revenue guarantee program in the 2008 farm bill could violate the U.S. commitments, even if prices remain high enough not to trigger traditional countercyclical or loan-rate payments." from authors' abstract
    Keywords: U.S. agricultural support, WTO Doha Round, WTO compliance, Food, Conservation and Energy Act of 2008, Notification of domestic support, trade,
    Date: 2008
  15. By: Williams, Jeffery R.; Llewelyn, Richard V.; Pendell, Dustin L.; Schlegel, Alan; Troy, Dumler
    Abstract: This study examines the economic potential of producing a wheat (Triticum aesitivum) and grain sorghum (Sorghum bicolor (L.) Moench) rotation with three different tillage strategies compared to the Conservation Reserve Program (CRP) in a semi-arid region. This research uses stochastic efficiency with respect to a function (SERF) to determine the preferred management strategies under various risk preferences and utility-weighted certainty equivalent risk premiums. Yields, input rates, and field operations from an experimental field in western Kansas are used to calculate net returns for each tillage strategy. Although current net returns to crop production using reduced tillage and no-tillage strategies are higher than CRP, risk analysis indicates CRP would be the preferred strategy for some risk-averse managers.
    Keywords: Conservation Reserve Program, conservation tillage, simulation, sorghum, wheat, risk, Agricultural and Food Policy, Crop Production/Industries, Farm Management, Land Economics/Use, Risk and Uncertainty,
    Date: 2009
  16. By: Jenny Aker
    Abstract: How do markets respond to extreme rainfall in West Africa? This paper examines the effect of weather on grain market performance in Niger, a country increasingly affected by drought and severe food crises over the past two decades. Using a dataset that combines information on rainfall, agricultural production, prices and transaction costs, I exploit rainfall variation to estimate the impact of drought on grain market performance between 1997 and 2006. Time series tests suggest that grain markets in Niger respond to supply shocks and that markets are more integrated during drought years. Exploiting the exogeneity of extreme rainfall in a difference-in-differences framework supports these findings: drought reduces grain price dispersion across markets. This impact is stronger as a higher percentage of markets are affected by drought, as was the case in 2004/2005, the year of a severe food crisis. The results suggest that early warning systems in West Africa should focus on the spatial impact of drought at the sub-regional level, as well as monitor prices in key forecasting markets during the harvest period.
    Keywords: Markets, food crisis, Africa, climate change, vector autoregressive model
    Date: 2008–12
  17. By: Gilligan, Daniel O.; Hoddinott, John; Taffesse, Alemayehu Seyoum
    Abstract: "This paper assesses the impact of Ethiopia's Productive Safety Nets Programme (PSNP), the largest social protection program in Sub-Saharan Africa outside of South Africa. Using Propensity Score Matching techniques, we find that the program has little impact on participants on average, due in part to transfer levels that fell far below program targets. Beneficiary households that received at least half of the intended transfers experienced a significant improvement in food security by some measures. However, households with access to both the PSNP and packages of agricultural support were more likely to be food secure, to borrow for productive purposes, use improved agricultural technologies, and operate their own nonfarm business activities. For these households, there is no evidence of disincentive effects in terms of labor supply or private transfers. However, estimates show that beneficiaries did not experience faster asset growth as a result of the programs. " from authors' abstract
    Keywords: Productive Safety Net Programme, Impact evaluation, food security, Public works, Social protection,
    Date: 2008
  18. By: Wouterse, Fleur S.
    Abstract: "This paper uses data envelopment analysis and new data from Burkina Faso to test the impact of intercontinental and continental migration on technical efficiency in the production of two cereals—millet and sorghum—by rural households. Econometric evidence supports our theoretical expectation that the impact of emigration varies by migrant destination. I find evidence of a positive relation between continental migration and technical efficiency and a negative relation between intercontinental migration and technical efficiency. In an imperfect market environment, continental migration is associated with greater efficiency because it removes a male labor surplus; explanations for the negative relationship between intercontinental migration and technical efficiency should be sought in a surplus of female labor supply. Overall, findings suggest that migration does not lead to a transformation of cereal production from traditional to modern, because in an imperfect market environment, liquidity received in the form of remittances cannot compensate for labor shortfalls." from authors' abstract
    Keywords: Migration, Rural households, Data envelopment analysis, Science and technology, Agricultural innovation, Cereal production, Institutional change, Innovation systems,
    Date: 2008
  19. By: Chen Xiang Liu
    Abstract: China’s current financial structure does not give sufficient support to rural areas, leaving many farmers and rural businesses without the capital they need to develop. Rural finance is the weakest point in the country’s entire financial system. Low profits for rural financial institutions, a lack of rural financial products and services and the difficulty many farmers experience in securing loans are the main problems plaguing the rural financial system. Accelerating rural financial reform and making it easier for rural people to access capital are key parts of the country’s effort to reform its overall financial system, to resolve “Three Rural Issues (San Nong)(1)” (Agriculture, Countryside, Farmers), and to create “new socialist countryside”. The main objectives of this paper are to (i) examine the current status of rural finance’s demand and supply and identify existing issues and constraints; (ii) evaluate ongoing rural financial reform and explore suitable roadmaps to develop a well-functioning and sustainable rural finance system, which would address the diverse needs of “new socialist countryside” construction. (1) San nong literally means three “nong”. The word “nong” in Chinese is combined with other words to form phrases such as nongye (agriculture), nongcun (villages or countryside), and nongmin (farmers or peasants).
    Keywords: banks, microcredit institutions, agricultural insurance, informal finance
    JEL: G21 G22 Q14
    Date: 2008
  20. By: Masters, William A.; Delbecq, Benoit
    Abstract: "This paper describes how governments and philanthropic donors could drive innovation through a new kind of technology contest. We begin by reviewing the history of technology prizes, which operate alongside private intellectual property rights and public R&D to accelerate and guide productivity growth towards otherwise-neglected social goals. Proportional “prize rewards” would modify the traditional winner-take-all approach, by dividing available funds among multiple winners in proportion to measured achievement. This approach would provide a royalty-like payment for incremental success. The paper provides concludes with a specific example for how such prizes could be implemented to reward and help scale up successful innovations in African agriculture, through payments to innovators in proportion to the value created by their technologies after adoption. " from authors' abstract
    Keywords: Productivity growth, Technology adoption, intellectual property, Agricultural R&D, Innovation,
    Date: 2008
  21. By: Shahnoushi, Naser; Henneberry, Shida; Manssori, Hooman
    Abstract: This study examines the relationship between food prices and monetary policy variables, using a Vector Error Correction Model (VECM) approach applied to annual data from 1976 to 2006. Results indicate that food prices in Iran have a long-run and short-run equilibrium granger causality relationship with money supply. More specifically, monetary policy reforms are shown to have a significant impact on food prices and domestic agricultural production. These policies influence consumption patterns and have serious implications for poverty reduction, food security issues, and agricultural growth in Iran.
    Keywords: VEC model, food Prices, monetary policy, Iran, Agricultural and Food Policy,
    Date: 2009–02
  22. By: Dercon, Stefan; Gilligan, Daniel O.; Hoddinott, John; Woldehan, Tassew
    Abstract: "This paper investigates whether public investments that led to improvements in road quality and increased access to agricultural extension services led to faster consumption growth and lower rates of poverty in rural Ethiopia. Estimating an instrumental variables model using Generalized Methods of Moments and controlling for household fixed effects, we find evidence of positive impacts with meaningful magnitudes. Receiving at least one extension visit reduces headcount poverty by 9.8 percentage points and increases consumption growth by 7.1 percent. Access to all-weather roads reduces poverty by 6.9 percentage points and increases consumption growth by 16.3 percent. These results are robust to changes in model specification and estimation methods." from authors' abstract
    Keywords: Public investment, roads, agricultural extension, income growth, Poverty,
    Date: 2008
  23. By: Godo, Yoshihisa; Takahashi, Daisuke
    Abstract: "The purpose of this paper is to provide a comprehensive review of Japan's agricultural domestic policy since 1995 in the context of the current international negotiations in the WTO Doha Round, which has as one aim further reductions of trade-distorting support among member countries. An overwhelming majority of farmers in Japan own small plots of rice paddy fields and earn their living mainly on their off-farm income. They go out into rice paddy fields in their spare time as a subsidiary business. Traditional small farming communities are powerful voting groups that seek to maintain their political power. By exerting political pressures on the authorities, farmers can obtain large returns through the manipulation of farmland use regulations, even though such manipulation causes social harm by preventing efficient land use. These inefficiencies in land use are a major reason why Japan is the only country whose food self-sufficiency rate keeps declining in spite of its heavy agricultural protection. In this sense, Japan is in sharp contrast to European and North American countries, where heavy agricultural domestic supports have resulted in an increased output of agricultural commodities and subsequent distortions in international markets. Apparently, Japan's attitude towards agricultural domestic policy reform is one of compliance with the WTO, which requests member countries to reduce their Aggregate Measure of Support (AMS) through trimming trade-distorting (amber box) support and/or transforming traditional-type agricultural subsidies to decoupled-type ones. Japan reduced its amber box support by nearly 80 percent between 1995 and 2000. This drastic reduction is mainly attributable to Japan's removal of rice from the amber box in 1998. In addition, following the WTO's principle of decoupling, Japan launched an extensive agricultural subsidy reform in 2007. This paper, however, shows the ironical realities of Japanese agricultural policy. Neither a sharp reduction of amber box support nor Japan's 2007 reform necessarily mean there will be a reduction of trade-distorting effects. On the contrary, the 2007 reform may in fact stimulate domestic rice production. In 2007, Japan's AMS is as little as 18 percent of its commitment level from the Uruguay Round WTO agreements. In addition, this paper projects that Japan's overall trade-distorting support (OTDS) for 2013 will be 469 billion yen, which is much less than the limit of 1,635 billion yen that is proposed in the modalities under discussion in July 2008 for the WTO Doha Round. Thus, the WTO Doha Round negotiations on domestic support policy are unlikely to restrict Japan's domestic agricultural support policy." from authors' abstract
    Keywords: Japan's agricultural support, WTO Doha Round, WTO compliance, Notification of domestic support, trade,
    Date: 2008
  24. By: Headey, Derek; Fan, Shenggen
    Abstract: "Although the potential causes and consequences of recent increases in international food prices have attracted widespread attention, many existing appraisals are superficial and/or piecemeal. This paper attempts to provide a more comprehensive review of these issues based on the best and most recent research, and includes fresh theoretical and empirical analysis. We first analyze the causes of the current crisis by considering how well standard explanations hold up against relevant economic theory and important stylized facts. Some explanations, especially rising oil prices, the depreciation of the US dollar, biofuel demand, and some commodity-specific explanations, hold up much better than some others. We then provide an appraisal of the likely macro- and microeconomic impacts of the crisis in developing countries. We observe a large gap in the effects of macro and micro factors, and note that when these factors are used to identify the most vulnerable countries, the results often point in different directions. We conclude with a brief discussion of what ought to be learned from this crisis." from authors' abstract
    Keywords: Food prices, global food crisis, oil prices, Biofuels, poverty impacts, macroeconomic impacts,
    Date: 2008
  25. By: Bureau, Jean-Christophe; Gohin, Alexandre; Guindé, Loïc; Millet, Guy; Brandão, Antônio Salazar P.; Haley, Stephen; Wagner, Owen; Orden, David; Sandrey, Ron; Vink, Nick
    Abstract: "Sugar is one of the most highly protected agricultural commodities worldwide. This protection depresses trade opportunities and the prices received by exporters without preferential market access. For this reason, dialogues about sugar policy are often polarized and short sound bites caustic. Yet today's sugar markets are being driven by a complex array of dynamic and emerging supply, demand, and policy forces that need to be understood. A number of these forces have the potential to reshape the global market scene. Recent sugar policy reforms in the European Union (EU) have received little attention in North America but may turn the EU into a net importer, with substantial compensation paid to its farmers and displaced processing facilities. High oil prices and the related ethanol boom place Brazil at the fulcrum of new market developments. In the United States, corn sweetener and sugar markets are being integrated with Mexican markets under the North American Free Trade Agreement (NAFTA), raising the question of whether the EU reforms provide a template for new policies. And among developing countries in Africa and elsewhere there are low-cost producers that would benefit from more open trade but others who would be disadvantaged by the loss of preferential markets. This discussion paper presents the proceedings of a one-day conference that served as a forum for the discussion of these and other critical issues affecting global sugar markets, policies, and reform options. The conference was attended by 60 representatives of governments, research institutions, producers and processors from the sugar sector, and other groups interested in sugar markets and policies. The four papers were presented by internationally recognized experts from the EU, Brazil, the United States, and South Africa. Discussion openers and general discussion at the conference added further policy insights, and the papers were edited and revised after the conference to reflect the dialogue that had occurred." from authors' abstract
    Keywords: sugar, Ethanol, NAFTA, WTO, Trade policy,
    Date: 2008
  26. By: Fausti, Scott; Qasmi, Bashir; Li, Jing
    Abstract: The relationship between publically reported weekly grid premiums and discounts for specific carcass characteristics and the percentage of those characteristics reflected in total weekly slaughter volume (i.e., proportional slaughter volume) is investigated. Granger Causality and multi-lag VAR models were used to investigate if grid premiums and discounts were efficiently transmitting market signals to producers with respect to carcass quality attributes. The empirical evidence indicates that there is little evidence to suggest that grid prices are providing efficient price signals to buyers and sellers with respect to market valuation of desirable and undesirable beef carcass characteristics.
    Keywords: Grid pricing, Granger Causality, slaughter cattle, beef carcass quality, Demand and Price Analysis, Livestock Production/Industries, Marketing, Q11, Q13,
    Date: 2009
  27. By: Matuschke, Ira
    Abstract: "In light of an increasing focus on new demand-driven extension approaches that aim at accelerating the adoption of innovative technologies by smallholder farmers in developing countries, greater analysis is needed of the role of rural social networks and their impact on technology adoption. This paper contributes to this topic by reviewing selected studies on rural social networks and by outlining a research approach that combines social network analysis with econometric estimation techniques in one coherent framework to strengthen the study of technology adoption by smallholders. If applied, such a framework could help establish which network characteristics have the greatest impact on technology uptake, thereby lending support to and improving the design of new extension approaches." from authors' abstract
    Keywords: Social network analysis, econometric modeling, adoption of innovations, farmer-to-farmer knowledge transfer,
    Date: 2008
  28. By: Yeboah, Osei-Agyeman; Ofori-Boadu, Victor; Salifou, Samaila
    Abstract: Agriculture is a vulnerable sector of the U.S economy, accounting for 13% of Gross Domestic Product and 15% of employment. It produces quality cheap food for domestic consumption and accounts for more than $65 billion in export revenues. Contagious animal diseases like Foot and Mouth Disease (FMD) are often referred to as economic diseases because of the magnitude of harm they cause producers, local communities and the consequences in international trade. Losses from the 2001 FMD outbreak in the United Kingdom are estimated at $10.7 to $11.7 billion. The total cost of an FMD outbreak is the sum of eradication cost, production losses, and the loss of exports. This paper examines the export effects of a bioterrorist attack such as the introduction of FMD on the US beef industry. The context is to model the US beef market as a price taker on the international beef market, the simplifying “small open economy†assumption of international economics. Although, the beef market is linked to beef prices around the world, we tend to conceive of the US beef market in terms of domestic supply and demand and the resulting domestic equilibrium price. The excess supply of beef is the difference between quantities supplied and demanded that increases with price and responds to other influences on domestic supply and demand. We assumed that U.S consumers will exercise more caution when purchasing beef at grocery store as a result of the outbreak of FMD. As U.S consumers alter their diet, poultry and pork will become good substitutes with poultry having a higher demand than pork. The economic impact of FMD is simulated based on expected changes in price of beef and its substitutes based on three different scenarios of the levels of FMD occurrences.
    Keywords: Excess supply, FMD, beef prices, bioterrorism, Agricultural and Food Policy, Environmental Economics and Policy, International Relations/Trade, Q17,
    Date: 2009
  29. By: Wijk, J.C.A.C. van; Danse, M.; Tulder, R.J.M. van (Erasmus Research Institute of Management (ERIM), RSM Erasmus University)
    Abstract: This paper examines the sustainability claims of private quality standards, voluntary adopted by supermarket to improve the quality of products in respect of food safety, and environmental and social sustainability. The concept of ‘sustainability’ is defined as the opportunity for upgrading by developing country suppliers in the retail supply chains. The paper reports of an explorative analysis on the perceived effects of 36 quality standards in the retail on upgrading. Data was collected through a survey of a wide variety of relevant media: websites, scientific articles and reports, policy reports, and online newspaper articles. The overall conclusion is that the majority of the 36 standards are perceived to facilitate trading opportunities for developing country producers, but only for those suppliers who can meet the criteria of quality standards. The study found interesting differences between various categories of standards. Standards initiated by NGOs and partnerships are perceived to offer better upgrading opportunities to suppliers than do standards initiated by (inter-) governmental authorities, by individual firms, or by business associations. Standards with an explicit social and social/environmental focus have a more positive influence on process and product upgrading in developing countries compared to voluntary food safety standards. Product-specific standards offer better upgrading opportunities than do generic quality standards.
    Keywords: supermarkets;corporate social responsibility;upgrading;global value chains;chain governance;upgrading
    Date: 2008–12–02
  30. By: Nyaupane, Narayan; Gillespie, Jeffrey
    Abstract: This study investigates factors influencing the adoption of best management practices in Louisiana crawfish production. Probit results show acreage, years farming, portion of income from farming, technology adoption tendencies, hunting leases and a stream running through the farm to influence adoption. The most frequently used BMP was irrigation water management.
    Keywords: Best Management Practices (BMPs), technology adoption, crawfish, probit, tenancy, crop rotation, Production Economics,
    Date: 2009
  31. By: Pavel Ciaian; Tomáš Ratinger
    Abstract: This paper analyses income distribution effects of investment support granted under the EU Rural Development Policies (RDP). In the short-run and with perfect credit markets, the size of gains for farms depends on the extent to which investment additionality is enforced. If additionality is not enforced, farms gain an important share of the total support but do not have incentive to increase capital use. If additionality is enforced, gains for farms are lower and farms can even lose. With imperfect rural credit markets, farms would most likely prefer to increase capital use even without enforcement of investment additionality and total welfare increases. In the long-run farm benefits from this investment may be enhanced because of the multiplier effect. Introducing minimum thresholds as eligibility criteria may deter small farms from uptaking the investment support even if investment additionally is not enforced. Benefits from investment support are shared with capital suppliers. Gains of capital suppliers depend on the size of the capital supply elasticity and are conditional on the EU support to increase farm capital demand.
    Keywords: Rural development policies, policy rents, policy modelling, farm investment.
    JEL: Q12 Q18
    Date: 2009–01–01
  32. By: Alem, Yonas (Department of Economics, School of Business, Economics and Law, Göteborg University); Bezabih, Mintewab (Department of Economics, University of Portsmouth, UK); Kassie, Menale (Department of Economics, School of Business, Economics and Law, Göteborg University); Zikhali, Precious (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: In this paper we use farmers' actual experiences with changes in rainfall levels and their responses to these changes to assess if patterns of fertilizer use are responsive to changes in rainfall patterns. Using plot and farm level panel data from the central Highlands of Ethiopia matched with corresponding village level rainfall data; results show that both the current year’s decision to adopt and the intensity of fertilizer adoption is positively associated with higher rainfall levels experienced in the previous year. Furthermore, we find a concave relationship between previous season rainfall levels and fertilizer adoption, indicating that too much rainfall discourages adoption. Abundant rainfall in the previous year could depict relaxed liquidity constraints and increased affordability of fertilizer, which makes rainfall availability critical in severely credit constrained environments. In light of similar existing literature, the major contribution of the study is its use of plot level panel data, which permits us to investigate the importance of plot characteristics in fertilizer adoption decisions.<p>
    Keywords: Fertiliser adoption; Rainfall; Highlands of Ethiopia; Panel data
    JEL: O12 O33 Q12 Q16 Q54
    Date: 2009–01–05
  33. By: Riordan, Brendan
    Abstract: This new analysis of Ireland’s Balance of International Payments (BOP) shows a surprisingly large net contribution from the Biosector. In 2005 net foreign earnings of the sector, comprising agriculture, forestry, fisheries, food, drink and tobacco industries, amounted to 32 percent of the total net earnings from primary and manufacturing industries. This is double the sector’s 16 percent contribution to exports in that year. Reasons for the sector’s disproportionately large net contribution to earnings from exports include: 1. Import requirements per euro of Biosector exports were lower than in the Non-Biosector, import requirements for every euro of output averaged 38 cent in the Biosector but 58 cent per euro of output in the Non-Biosector. 2. Foreign ownership, and thus profit repatriation outflow, was lower than in other sectors. This was despite strong growth in the activities of foreign based enterprises in some of the food and beverage industries. Profit repatriation by these enterprises in the Biosector was only 9 cent per euro of exports in 2000 while it was then 21 cent on average in the Non-Biosector. However, since 2000 the activities of foreign owned businesses in the Biosector have grown and their profit repatriation in 2005 accounted for 15 cent per euro of exports from this sector. On the other hand this growth propelled a 46 percent increase in exports from the sector between 2000 and 2005, though this is not visible in the Trade Statistics, possibly due to data confidentiality concerns. Profit repatriation by businesses in the Non-Biosector peaked at 26 cent per euro of exports in 2002, but by 2005 it was back again to 20 cent. 3. Receipts of EU payments were almost entirely in support of agriculture and its exports. This is especially a feature of the Biosector, unlike the Non-Biosector where they are negligible. EU payments grew at the same rate as exports from the Biosector in the years from 2000 to 2005 and continued to provide an important addition to BOP inflows. Importation of capital goods was also analysed in the context of the BOP. Results showed that industries in the Biosector made almost as much use of imported capital goods as those in the Non-Biosector. Thus adjustment of net in-flow estimates for out-goings on the purchase of capital goods from abroad only raised the net contribution of the Biosector from 30 percent to 32 percent of the total, according to calculations for 2005. Corresponding figures for the year 2000 were higher at 38 percent and 39 percent respectively. In every one of the intervening years the Biosector’s net contribution was found to be close to 30 percent. Support for the overall conclusion that the Biosector contributed close to 30 percent of the net flow of funds into the economy generated by the primary and manufacturing industries is provided by the detailed analysis described in the Report. What is more, were the earnings of Irish companies operating abroad to be included, the result could have shown an even larger contribution from the Biosector, due to the overseas achievements of Irish food firms. Results for 2007 could also show a higher proportionate contribution from the Biosector, reflecting large increases in prices for food product exports between 2005 and 2007.
    Keywords: International Balance of Payments; Agri-food sector; quantification of sector's net contribution; Ireland;
    JEL: F14 L66 F24
    Date: 2008–05
  34. By: Lopez, Ramon; Islam, Asif
    Abstract: Trade, the exchange of goods and services across countries, is often viewed as an engine of economic growth. Benefits of liberalized trade include access to a larger variety of goods and services to consumers, easier access to foreign technologies, access to larger markets for producers, and increased efficiency in resource allocation. The impact of trade on the environment, however, is a contentious issue; air and water pollution, the degradation of natural habitats and loss of species, and global pollutants, particularly carbon dioxide emissions, are major concerns.
    Keywords: Environmental Economics and Policy, International Relations/Trade,
    Date: 2008

General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.