nep-agr New Economics Papers
on Agricultural Economics
Issue of 2009‒09‒11
twelve papers chosen by
Angelo Zago
University of Verona

  1. Impact of Biofuels Policy on Agribusiness Stock Prices, The By Fatma Sine Tepe; Xiaodong Du; David A. Hennessy
  2. Determinants of Food Security in Rural Areas of Pakistan By Khan, Rana Ejaz Ali; Gill, Abid Rashid
  3. Productive efficiency of specialty and conventional coffee farmers in Costa Rica: Accounting for technological heterogeneity and self-selection By Meike Wollni; Bernhard Brümmer
  4. Wealth, Debt, Government Payments, and Yield Performance By Maria Joana Girante; Barry K. Goodwin; Allen Featherstone
  5. The Premium for Organic Wines: Estimating a Hedonic Price Equation from the Producer Side By Alessandro, Corsi; Strøm, Steinar
  6. Successful organizational learning in the management of agricultural research and innovation: The Mexican produce foundations By Ekboir, Javier M.; Dutrénit, Gabriela; Martínez V., Griselda; Vargas, Arturo Torres; Vera-Cruz, Alexandre O.
  7. "Market Failure and Land Concentration" By Fatma Gul Unal
  8. Changing business perceptions regarding biodiversity: from impact mitigation towards new strategies and practices By Joël Houdet; Michel Trommetter; Jacques Weber
  9. Strategic Group Formation in the Mekong Delta: The Development of a Modern Hydraulic Society By Evers, Hans-Dieter; Benedikter, Simon
  10. Conservation and Ecotourism in Brazil and Mexico: The Development Impact By David Ivan Fleischer
  11. Solar PV rural electrification and energy-poverty: A review and conceptual framework with reference to Ghana By Obeng, George Yaw; Evers, Hans-Dieter
  12. Embeddedness of Entrepreneurs in Rural Areas: A Comparative Rough Set Data Analysis By Aliye Ahu Gulumser; Peter Nijkamp; Tüzin Baycan-Levent; Martijn Brons

  1. By: Fatma Sine Tepe; Xiaodong Du (Center for Agricultural and Rural Development (CARD); Food and Agricultural Policy Research Institute (FAPRI)); David A. Hennessy (Center for Agricultural and Rural Development (CARD))
    Abstract: Corn markets are important for many industries, including the seed, fertilizer, meat production/processing and agricultural machinery sectors, all of which are highly concentrated. Oligopoly theory suggests that corn input and field equipment suppliers likely benefit from policies that support corn markets, such as U.S. biofuels policy, while meat companies are likely adversely affected. Employing a linear two-factor (S&P 500 and corn prices) equilibrium asset pricing model, this study investigates the impact of biofuels policy on U.S. agribusiness and food processing firm stock prices. Conditional heteroskedasticity in stock returns is accounted for using a GARCH(1,1) model. Corn price increases are found to have positive effects on excess stock returns for seed, fertilizer and machinery companies, while the impact on meat companies is negative. The results may be interpreted as evidence that crop input suppliers gain from U.S. biofuels policy while meat processors lose.
    Keywords: biofuels policy, excess stock returns, GARCH effect, linear factor model. JEL Classification: D43; L13; Q14.
    Date: 2009–09
  2. By: Khan, Rana Ejaz Ali; Gill, Abid Rashid
    Abstract: Abstract: Out of 120 districts of Pakistan (for rural areas) only 40 are food secure while 80 (67 percent) are food insecure. Within these food insecure districts, 38 (46 percent) are extremely food insecure. The matter of food security in rural areas is of immense nature and needs to be probed. A number of factors are responsible for the situation. The current paper examines the determinants of three aspects of food security in rural areas of Pakistan, i.e. food availability, accessibility and absorption. For the purpose a series of models is applied on district level data of rural areas of Pakistan. The production of wheat, rice, maize, pulses, oilseeds, poultry meat and fish at the district level is found to affect food availability positively. All the district except of Sindh are more probable to be food insecure in availability. In the food accessibility electrification and adult literacy emerged as the factors having negative effect. Child immunization, safe drinking water and number of hospitals have shown positive effect on food absorption.
    Keywords: Food production; Rural areas; Pakistan; Food security; Devolution.
    JEL: Q1 Q15 Q18
    Date: 2009–02–16
  3. By: Meike Wollni (University of Göttingen); Bernhard Brümmer (University of Göttingen)
    Abstract: A steep decline in coffee prices at the producer level led to considerable pressure for farmers in Costa Rica and producer countries all over the world. One possible reaction was moving to specialty markets, where price pressure was perceived to be lower. We use original survey data from 2002/03 and 2003/04 to analyze the factors influencing efficiency levels of conventional and specialty coffee farmers. Controlling for selectivity bias, we find that technical efficiency in the two subsamples is influenced by both identical and divergent factors. Among the former, additional income activities increase efficiency. Among the divergent factors, experience, bookkeeping, and the number of adult household members are found to have a significant impact in the specialty coffee model. In the case of conventional coffee farmers, membership in cooperatives leads to higher farm-level efficiency. Based on the results, we derive policy recommendations to improve farmers’ production performance and ability to cope with the effects of the coffee crisis. These policy measures include the provision of extension services with respect to accounting methods, the creation of income opportunities in rural areas, and the support of farmer-owned cooperatives.
    Keywords: Coffee; Costa Rica; Stochastic frontier analysis; Sample Selectivity; Specialty markets; Technological heterogeneity
    JEL: Q12 D24
    Date: 2009–09–03
  4. By: Maria Joana Girante (Universidade do Minho - NIPE); Barry K. Goodwin (North Carolina State University - Dept. Agricultural and Resource Economics, Raleigh, NC, U.S.A); Allen Featherstone (Kansas State University, Department of Agricultural Economics, KS, US)
    Abstract: We use a large sample of Kansas Farm Management Association farms for eight different crop/practice combinations (dryland and irrigated corn, sorghum, soybeans, and wheat)for 1994 through 2006 to evaluate the determinants of relative yield performance and explore the ability of financial variables to account for some of the remaining unexplained variation. Our hypothesis is that more financially sound farms should be able to implement better production thecniques, thus have better yields. We further test whether decoupled payments can be used to enhance yield performance. Our hypothesis is that payments may be used to boots investment in inputs or equipament that can lead to better yields. Our results suggest this could be the case.
    Keywords: yield performance; decoupled payments.
    JEL: Q17 Q18
    Date: 2009
  5. By: Alessandro, Corsi (Department of Economics, University of Turin, Italy); Strøm, Steinar (Dept. of Economics, University of Oslo)
    Abstract: Organic production techniques are an increasing, though minor so far, part of agriculture, and organic wines are increasingly produced and appreciated. Nevertheless, since the organic technique is more costly, a crucial question is whether organic wines benefit from a price premium. In this paper a hedonic price function has been estimated for Piedmont organic and conventional wines. Unlike the current literature on the determinants of wine prices, we used data on the production side in addition to variables of interest for consumers. One question was whether farm and operator’s characteristics of no interest for consumers affect wine prices. The second question was whether organic wine obtains a price premium relative to conventional wine. Our results show that, along with characteristics that are of interest to consumers, like the appellation and the variety, some farm and producer characteristics that are not directly relevant for consumers do significantly affect wine prices. We also find that, though there is not a premium in the sense of an addition to other price components, given farmers’ and wines’ characteristics, organic wines do command higher prices.
    Keywords: Organic wine; hedonic price; price premium; Piedmont
    JEL: C21 L11 Q12
    Date: 2009–02–20
  6. By: Ekboir, Javier M.; Dutrénit, Gabriela; Martínez V., Griselda; Vargas, Arturo Torres; Vera-Cruz, Alexandre O.
    Abstract: "Since the 1980s, developing countries' agriculture has become more complex and diversified. In general, the public research and extension institutions in these countries were criticized for not participating in the emergence of the most dynamic agricultural markets. In recent years, many of these institutions have struggled to adapt to the new environment but they could not overcome the hurdles posed by organizational rigidities, strict public regulations, deteriorating human capital, shrinking budgets and a model of science that hampered their integration into dynamic innovation processes. In general, developing countries applied similar agricultural research policies: separation of financing and implementation of research, reductions in direct budgetary allocations to research and extension institutions, elimination or major reduction of public extension, and introduction of competitive grants programs to induce a transformation of research organizations. Strong anecdotal information suggests that these policies had limited impact on the quality and pertinence of research, and on the performance of the public research institutions. Using a different set of instruments, the Mexican Produce Foundations (PF) had major and diverse impacts on the agricultural innovation and research systems. These impacts resulted mostly from activities the PF introduced as they learned to manage funds for research and extension, and to a lesser extent from the activities they were created for, i.e., manage a competitive fund for agricultural research and extension. The PF were able to introduce these activities because they developed strong abilities to learn, including identifying knowledge gaps and defining strategies to fill them. The questions this report seeks to answer are how an organization that manages public funds for research and extension could sustain organizational innovations over extended periods, and how it could learn and adapt to maximize its impact on the agricultural innovation system. Previous studies found that human resources, organizational cultures and governance structures are three of the most important factors influencing institutional change and innovative capabilities. Despite their importance, these factors have been largely neglected in the literature on agricultural research and extension policies. This document analyzes what role these factors played in the Mexican experience." from text
    Keywords: Agricultural research, Agricultural innovation, Developing countries,
    Date: 2009
  7. By: Fatma Gul Unal
    Abstract: Utilizing a 2002 household-level World Bank Survey for rural Turkey, this paper explores the link between concentration of land ownership and rural factor markets. We construct a unique index that measures market malfunctioning based on the neoclassical model linking land and labor endowments through factor markets to household income. We further test whether land ownership concentration affects market malfunctioning. Our empirical investigation supports the claim that factor markets are structurally limited in reducing existing inequalities as a result of land ownership concentration. Our findings show that in the presence of land ownership inequality, malfunctioning rural factor markets result in increased land concentration, increased income inequality, and inefficient resource allocation. This work fills an important empirical gap within the development literature and establishes a positive association between asset inequality and factor market failure.
    Date: 2009–08
  8. By: Joël Houdet (Orée - (-)); Michel Trommetter (INRA - UMR GAEL INRA - UPMF, Department of Economics, Ecole Polytechnique - CNRS : UMR7176 - Polytechnique - X); Jacques Weber (CIRAD - Unité de recherche Ressources forestières et politiques publiques)
    Abstract: Business activities play a major role in biodiversity loss and, as a result, firms are under increasing pressures from stakeholders to reduce their negative impacts on living systems. In response, business attitudes, behaviors and strategies regarding biodiversity are progressively changing, suggesting that interactions between business and biodiversity could go beyond the search of a compromise between development and conservation. This paper proposes an analysis of business perceptions regarding biodiversity. In its first part, we discuss how biodiversity is usually perceived as an external environmental constraint on business activities, and how economic tools may be used for arbitrages in that context. Building upon our work on the Business and Biodiversity Interdependence Indicator (BBII), we then discuss how assessing a firm's interdependences with biodiversity may bring about new business strategies and practices. We propose a typology of firm behavior regarding biodiversity and ecosystem services (BES), discuss business opportunities and property rights issues pertaining to markets for ecosystem services and propose preliminary conceptual foundations of new business standards needed to reverse current biodiversity trends.
    Keywords: biodiversity; business; strategy; payments for ecosystem services; impact mitigation; standards.
    Date: 2009–09–02
  9. By: Evers, Hans-Dieter; Benedikter, Simon
    Abstract: The lower Mekong Delta, one of the largest river deltas in Asia, is a landscape shaped by the waters of the Mekong River that flows, as last part of its long way from the Tibetan Plateau to the South Chinese Sea, through a dense river and canal network in the Southwest of Vietnam. People in this area are, traditionally, exposed to a water-shaped environment and have lived for generations in adaptation to their natural surrounding without much human interference into the complex natural hydraulic system of the delta. However, this has changed dramatically during recent decades when hydraulic management started to become a key issue for the development of the lower Mekong Delta constantly, in particular with respect to the agricultural sector, which is the backbone of the delta’s economy. After the Second Indochinese War ended in 1975 the delta started to shift from human adaption to human control, transforming itself into what Wittfogel has described as a hydraulic society. This was mainly due to the new socialist government’s policy of rapid agricultural extension and growing endeavours in hydraulic management for fostering irrigated rice production. By now, in many places of the delta hydraulic works such as additional canals, dykes and sluices have been set up, constructed for regulating water flows. Technical innovations in hydraulic management and agricultural production have not only had significant impact on the delta’s environment and ecology, but also have triggered social transformation, in particular the appearance of new social groups struggling for access to resources and power. This paper intends to analyzes recent trends of social development and water management in the Mekong Delta from a scientific approach that is based on two social theories, firstly “strategic group analysis”, and secondly selected core aspects of Wittfogel’s social theory of “hydraulic society”. By presenting recently collected data, it is illustrated how the Mekong Delta has been transformed into a modern hydraulic society, in which certain strategic groups emerged as a consequence of growing activities in hydraulic management and agricultural-based economic growth. More specifically, the paper aims to give an overview of strategic group development in the delta by putting a strong focus on the process of forming a state bureaucracy of hydraulic management and the appearance of hydraulic construction companies as its clients. The paper shows how the strategic alliance between both groups has increased the chances for mutually appropriating government funds spent on hydraulic works and how this has caused ecologically and socially far-reaching impacts for the Mekong Delta.
    Keywords: Vietnam; Mekong Delta; strategic groups; hydraulic society; social transformation and power; water management; hydraulic bureaucracy; economic development
    JEL: D74 A11
    Date: 2009–05–02
  10. By: David Ivan Fleischer (International Policy Centre for Inclusive Growth)
    Abstract: Conservation projects alter local productive modes and have an impact on livelihoods. For example, sea turtle conservation projects affect fishing communities through hunting restrictions. It is not painless for communities to improve fishing technology in order to prevent the accidental capture of sea turtles. The inability to adapt to environmental requirements forces fishermen to abandon traditional livelihoods. A combination of environmental conservation and ecotourism development can provide the solution. (...)
    Keywords: Conservation and Ecotourism in Brazil and Mexico: The Development Impact
    Date: 2009–09
  11. By: Obeng, George Yaw; Evers, Hans-Dieter
    Abstract: In spite of the intention of governments to increase the use of renewable energy in electricity supply, particularly the use of solar photovoltaic (PV) for energy poverty reduction in rural and peri-urban areas of Africa, there is relatively little information on how solar PV electrification impacts on energy poverty reduction. Therefore, there is a gap in the literature and hence the need for continuous research. Using Ghana as a reference country, the historical trend, donor cooperation and other aspects of solar PV rural electrification are discussed . The paper illustrates the intersectoral linkages of solar PV electrification and indicators on education, health, information acquisition, agriculture and micro-enterprises. It also reviews sustainability related issues including costs and market barriers, subsidies, stakeholders involvement, political and policy implications, which are critical factors for sustainable market development of solar PV and other renewables. Finally, a common framework is developed to provide a basic understanding of how solar PV electrification impacts on energy-poverty. This framework provides a structure of the interrelated concepts and principles relevant to the issues under review.
    Keywords: Rural electrification; solar PV electrification; energy-poverty; renewable energy; economic development; Ghana; Africa.
    JEL: N57 O55 N37 O13 Q42 N7 P28 Q43
    Date: 2009–02–02
  12. By: Aliye Ahu Gulumser (VU University Amsterdam, Istanbul Technical University); Peter Nijkamp (VU University Amsterdam); Tüzin Baycan-Levent (Istanbul Technical University); Martijn Brons (VU University Amsterdam)
    Abstract: This study aims to identify the critical factor(s) that determine the embeddedness level (EL) of rural entrepreneurs. In order to achieve this aim, existing applied studies on the embeddedness of entrepreneurs undertaken in different rural areas were systematically collected to create a database in order to provide the material for a systematic comparative analysis. This was done in order to highlight common and contrasting findings from a set of selected studies for different ELs. As many results of these studies were largely qualitative in nature and only partially comparable, a specific tool for analysing categorical data based on artificial intelligence methods, viz. rough set data analysis (RSDA), was employed. This experimental study is the first RSDA approach that compares the results of several rural case studies and infers general induction rules for the different ELs. The results of our analysis show that using and benefiting from local resources are the key factors that explain how entrepreneurs become embedded in rural areas.
    Keywords: rural development; rural entrepreneurship; embeddedness; rough set data analysis
    JEL: Q19 R23
    Date: 2009–07–16

This nep-agr issue is ©2009 by Angelo Zago. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
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