nep-agr New Economics Papers
on Agricultural Economics
Issue of 2009‒10‒10
thirteen papers chosen by
Angelo Zago
University of Verona

  1. The Forgotten Property Rights: Restrictions on Land Use in Vietnam By Thomas Markussen; Finn Tarp; Katleen Van den Broeck
  2. Growth in high-value export markets in Sub-Saharan Africa and its development implications By Miet Maertens; Bart Minten; Jo Swinnen
  3. Is Fair Trade Honey Sweeter? An Empirical Analysis on the Effect of Affiliation on Productivity By Leonardo Becchetti; Stefano Castriota
  4. The emergence of biofuels and the co-movement between crude oil and agricultural prices By Francisco Peñaranda; Augusto Rupérez-Micola
  5. From famine to food crisis. What history can teach us about local and global subsistence crises By Vanhaute, Eric
  6. Insurance, Credit and Safety Nets for the Poor in a World of Risk By Daniel Clarke; Sefan Dercon
  7. Economic Roles of Farmer's Specialized Cooperatives under Agro-industrialization in Rural China: An Empirical Analysis based on Household and Administrative Village Surveys By Hisatoshi Hoken; Hiroshi Sato
  8. A Paradox for Agro-Environmental Land Policy By David A. Hennessy; Hongli Feng
  9. Research and Productivity in Thai Agriculture By Waleerat Suphannachart; Peter Warr
  10. The World Trade Organization and Climate Change: Challenges and Options By Gary Clyde Hufbauer; Jisun Kim
  11. Choices under Risk in Rural Peru By Galarza, Francisco
  12. Characterizing Fresh Pear Consumers Purchasing Patterns By Karina Gallardo; Eugene Kupferman; Chris Sater
  13. Quality and Inclusion of Small Producers in Value Chains: A Theoretical Note By Thijs Vandemoortele; Scott Rozelle; Johan F.M. Swinnen; Tao Xiang

  1. By: Thomas Markussen (Department of Economics, University of Copenhagen); Finn Tarp (Department of Economics, University of Copenhagen); Katleen Van den Broeck (Department of Economics, University of Copenhagen)
    Abstract: Studies of land property rights usually focus on tenure security and transfer rights. Rights to determine how to use the land are regularly ignored. However, in transition economies such as Vietnam and China, user rights are often limited. Relying on a unique Vietnamese panel data set at both household and plot level, we show that crop choice restrictions are widespread and prevent crop diversification. Restrictions do not decrease household income, but restricted households work harder, and there are indications that they are supplied with higher quality inputs. Our findings are consistent with the view that the Vietnamese government has managed to intervene effectively in agricultural (rice) production to promote output and food security. At the same time, it is now time to carefully consider the potential benefits of a more diversified crop pattern.
    Keywords: Property rights; restrictions; Vietnam
    JEL: D1 O1 Q1
    Date: 2009–09
  2. By: Miet Maertens; Bart Minten; Jo Swinnen
    Abstract: During the past decades the global food system changed dramatically with increased trade in high-value food products, increased exports from developing countries, increased consolidation and dominance of large multinational food companies, and increased proliferation of public and private food standards. As a consequence, global food trade is increasingly organised around vertically coordinated supply chains rather than around spot market transactions. While there is consensus that these structural changes are profoundly changing the way food is produced and traded, there is no consensus on the overall welfare implications of increased high-value food exports and supply chain restructuring in poor countries. In this paper we discuss the income and poverty implications of expanded horticulture exports and changing supply chain structures for rural households in Sub- Saharan African exporting countries. We put together the economic arguments; distinguish different channels through which rural households are affected; provide evidence from three comparative case-studies on high-value horticulture exports; and derive implications for policy makers, private investors, and the development aid community.
    Keywords: trade, poverty, modern supply chains, Africa
    JEL: F2 J43 O12 Q12 Q17
    Date: 2009
  3. By: Leonardo Becchetti (Faculty of Economics, University of Rome "Tor Vergata"); Stefano Castriota
    Abstract: We evaluate the impact of affiliation to Fair Trade on a sample of Chilean honey producers. Evidence from standard regressions and propensity score matching shows that affiliated farmers have higher productivity (income from honey per worked hour) than the control sample. Additional results on the effects of affiliation on training, cooperation and advances on payments suggest that affiliation contributed both to, and independently from, the economies of scale effect. Therefore, we show that the productivity effect is partially explained by the superior capacity of affiliated workers to exploit economies of scale.
    Keywords: fair trade, economies of scale, productivity.
    JEL: D63 D64 O18 O19 O22
    Date: 2009–06–30
  4. By: Francisco Peñaranda; Augusto Rupérez-Micola
    Abstract: Biofuels are becoming an alternative to non-renewable energy sources but we know little about the economic mechanisms influencing their prices. This paper studies the interrelationships between the spot prices of oil and those of agricultural commodities used as biofuel feedstocks. Using daily data since 1988, we identify a co-movement after 2005 that does not appear for other food-related commodities and is not due to general economic variables. We also find traces of the co-movement in the prices of a large biofuel stock. The results amount to the first systematic piece of empirical evidence linking spot oil and agricultural markets via the emergence of biofuels.
    Keywords: Biofuels, co-movement, ethanol, oil, structural breaks, threshold regressions
    JEL: G15 Q18 O13
    Date: 2009–10
  5. By: Vanhaute, Eric
    Abstract: The range of famine prone regions in the world has been shrinking for centuries; it’s currently mainly limited to sub-Sahara Africa. Yet the impact of endemic hunger has not declined and the early 21st century seems to be faced with a new threat: global subsistence crises. In this essay I question the concepts of famine and food crisis. I will formulate some suggestions to understand these seemingly unrelated processes in a more integrated way. The article successively debates historical famine research, Europe’s ‘grand escape’ from hunger, past and contemporary ‘depeasantisation’, and the state of 21st century food systems. Only more integrated models of interpretation can supersede the dualistic histories of food and famine that have been dominating developmentalist stories for so long.
    Keywords: famines food crisis peasantry depeasantisation
    JEL: N10 N50 Q10 Q18
    Date: 2009–09
  6. By: Daniel Clarke; Sefan Dercon
    Abstract: This paper asks how insurance can be more effectively delivered to the poor, and what its role should be relative to other microfinance programmes, safety nets and informal insurance systems. We focus on the various interactions, including how insurance may crowd out credit and informal insurance, and implications for the design of insurance schemes. We argue that well-designed insurance schemes, building on existing informal systems, and focusing on catastrophic and serious covariate risks, could offer protection against risk and contribute to poverty reduction beyond the combined impact of microcredit programmes, safety nets and existing informal mutual support systems.
    Keywords: Risks, Microcredit, Microinsurance, Safety nets
    JEL: G21 G22 O16 O17
    Date: 2009–10
  7. By: Hisatoshi Hoken; Hiroshi Sato
    JEL: D21 Q12 Q13
    Date: 2009–09
  8. By: David A. Hennessy (Center for Agricultural and Rural Development (CARD)); Hongli Feng
    Abstract: A regulator with a fixed budget to spend on securing environmental benefits from farmed land has to choose between how many acres to enroll and the extent of benefits to require of each enrolled acre. Here we consider, given heterogeneous land, what properties of the environmental benefit-to-cost ratio imply for the choice of optimal program as the available budget varies. Conditions are found such that a program of high benefits on few acres is preferred for any budget level. It is also possible that a program delivering low benefits per acre at low cost is preferred on each land type, and yet a high benefit program is optimal policy, a variant of Simpson's paradox.
    Keywords: benefit-to-cost ratio, environmental policy, land heterogeneity, Simpson's paradox.
    JEL: D6 Q2
    Date: 2009–10
  9. By: Waleerat Suphannachart; Peter Warr
    Abstract: This paper examines the impact that publicly funded agricultural research has on productivity in crop production within Thailand. It tests empirically the two hypotheses that, first, publicly funded research and development (R&D) in crop production is a significant determinant of total factor productivity (TFP) in the crop sector and, second, that its social rate of return is high. The statistical analysis applies error correction methods to national level time series data for Thailand, covering the period 1970 to 2006. Emphasis is given to public research in crop production, where most publicly funded agricultural R&D has occurred. The role of international research spillovers and other possible determinants of TFP are also taken into account. The results demonstrate that public investment in research has a positive and significant impact on TFP. International research spillovers have also contributed to TFP. The results support the finding of earlier studies that returns on public research investment have been high. This result holds even after controlling for possible sources of upward biases present in most such studies, due to the omission of alternative determinants of measured TFP. The findings raise a concern over declining public expenditure on crop research, in Thailand and many other developing countries.
    Keywords: agricultural research, productivity, Thai agriculture, error correction model
    JEL: O30 Q16 C32
    Date: 2009
  10. By: Gary Clyde Hufbauer (Peterson Institute for International Economics); Jisun Kim (Peterson Institute for International Economics)
    Abstract: Trade and environment intersect in many ways. Aside from the broad debate as to whether economic growth and trade adversely affect the environment, there are linkages between existing rules of the World Trade Organization (WTO) and rules established in various multilateral environmental agreements. Controlling greenhouse gas emissions promises to be a top priority for both national and international agendas, and special attention must be given to the relationship between the WTO and the emerging international regime on climate change. This working paper examines the nexus of the WTO and climate change and discusses challenges and options.
    Keywords: World Trade Organization, WTO, climate change, global warming, border adjustments
    JEL: F13 F18 Q54 Q56
    Date: 2009–09
  11. By: Galarza, Francisco
    Abstract: This paper estimates the risk preferences of cotton farmers in Southern Peru, using the results from a multiple-price-list lottery game. Assuming that preferences conform to two of the leading models of decision under risk--Expected Utility Theory (EUT) and Cumulative Prospect Theory (CPT)--there is strong evidence of moderate risk aversion. Once we include individual characteristics in the estimation of risk parameters, we observe that farmers use subjective nonlinear probability weighting, a behavior consistent with CPT. Interestingly, when we allow for preference heterogeneity via the estimation of mixture models--where the proportion of subjects who behave according to EUT or to CPT is endogenously determined--we see that the majority of farmers’ choices are best explained by CPT. We further hypothesize that the multiple switching behavior observed in our sample can be explained by nonlinear probability weighting made in a context of large random calculation mistakes; the evidence found on this regard is mixed. Finally, we find that attaining higher education is the single most important individual characteristic correlated with risk preferences, a result that suggests a connection between cognitive abilities and behavior towards risk.
    Keywords: risk aversion; probability weighting; mixture models; experimental economics; Peru
    JEL: C9 D81
    Date: 2009–08
  12. By: Karina Gallardo; Eugene Kupferman; Chris Sater (School of Economic Sciences, Washington State University)
    Abstract: Fresh pears are one popular fruits consumed in the U.S. Yet, annual percapita consumption is by far lower than bananas, melons, and apples, the top three consumed fresh fruits. Indeed, pears are ranked 9th in annual percapita consumption out of a list of 23 fruits listed by the Economic Research Service – USDA (2009).
    Date: 2009–09
  13. By: Thijs Vandemoortele; Scott Rozelle; Johan F.M. Swinnen; Tao Xiang
    Abstract: This paper develops a formal theory of the endogenous process of the introduction of high quality products in developing countries. Initial differences in income and capital and transaction costs are shown to affect the emergence of and the size of the high quality economy. Initial differences in the production structure and the nature of transaction costs ¨C as well as the possibility of contracting between producers and processors ¨C are shown to determine which producers are included in the high quality economy, and which not.
    Date: 2009

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