nep-agr New Economics Papers
on Agricultural Economics
Issue of 2010‒03‒06
eleven papers chosen by
Angelo Zago
University of Verona

  1. Program evaluation of agricultural input subsidies in Malawi using treatment effects: Methods and practicability based on propensity scores By Chirwa, Themba G.
  2. The changing structure of production: Argentine agriculture 1988–2002 By Marcos Gallacher
  3. Local Knowledge and Agricultural Sustainability: A Case Study of Pradhan Tribe in Adilabad District By Anil Kumar K
  4. Nutrition and Risk Sharing within the Household By Dubois, Pierre; Ligon, Ethan
  5. Changes in Beliefs and Perceptions about the Natural Environment in the Forest-Savanna Transitional Zone of Ghana: The Influence of Religion By Paul Sarfo-Mensah; William Oduro
  6. Public Support for Innovation, Intangible Investment and Productivity Growth in the UK Market Sector By Haskel, Jonathan; Wallis, Gavin
  7. Estimating models with unit and item nonresponse from cross-sectional surveys By Giuseppe De Luca; Luigi Franco Peracchi
  8. An Economic Breakeven Model of Cellulosic Feedstock Production and Ethanol Conversion with Implied Carbon Pricing By Miranowski, John; Rosburg, Alicia
  9. European Forests and Carbon Sequestration Services: An Economic Assessment of Climate Change Impacts By Paulo A.L.D. Nunes; Helen Ding; Sonja Teelucksingh
  10. A Productivity analysis of Eastern European banking taking into account risk decomposition and environmental variables By Karligash Kenjegalieva; Richard Simper
  11. Commodity prices, commodity currencies, and global economic developments By Jan J. J. Groen; Paolo A. Pesenti

  1. By: Chirwa, Themba G.
    Abstract: Several evaluations have been conducted to assess the impact of agricultural input subsidies in Malawi but have been mostly either descriptive or qualitatively inferred of the intervention impacts on the overall goal of the subsidy program. In most studies cited in this paper their approaches do not control for misspecification errors that might arise due to selection bias. One common erroneous approach is the lack of controlling for treatment effects. In this study we employ quasi-experimental econometric techniques using propensity scores to control for selection bias by creating control groups for those individuals that benefit from agricultural input subsidies. The study utilizes raw household data from two surveys conducted through the Malawi National Statistical Office in 2004/05 and 2006/07 production seasons. A household model for each dataset is estimated together with Average Treatment Effects on the Treated to assess the impact of targeted fertilizer input subsidies in 2004/05 and a refined program adopted in 2006/07 production periods. The evidence suggest that the starter pack or targeted input program implemented before 2004/05 focusing on one tenth of a hectare had a significant negative impact on household food expenditures compared to the refined program in 2006/07 that targeted about half a hectare for marginalized smallholder farmers. The latter, though portraying mostly insignificant results, showed positive impacts on household food expenditures. The approach adopted also proposes ways in which policy makers can effectively and independently evaluate the impact of public programs on social and economic welfare.
    Keywords: Fertilizer Subsidies; Propensity Scores; Logit; Nearest Neighbor; Stratification; Kernel; Radius; Complex Survey Design; Average Treatment Effects on the Treated
    JEL: D13 H43 I38 C31 H23
    Date: 2010–02–22
  2. By: Marcos Gallacher
    Abstract: The agricultural sector of many countries shows increasing farm size with corresponding decrease in farm numbers. Despite abundant research, the determinants of changes in firm numbers and size have not been clearly identified. This paper attempts to explain small firm survival in Argentine agriculture in the 1988 – 2002 period. The evidence suggests that labor market considerations, as well changing optimal size in response to production specialization are important factors affecting small-firm disappearance. In contrast, factor proportions (the K/L ratio) does not appear to have an impact on changes in firm size.
    Keywords: economies of scale, Argentine agriculture, agricultural labor markets.
    JEL: D2
    Date: 2009–12
  3. By: Anil Kumar K
    Abstract: The increasing attention and scientific research have made it possible to recognize tribal farmers as innovators, based on their unique practices in the field of sustainable agriculture. The study aims at understanding the importance of such farmers' knowledge and role in sustainable agriculture among the Pradhan Tribe in Adilabad District. The paper presents some empirical data from the Pradhan Tribe of Andhra Pradesh which highlights the community's indigenous agricultural knowledge and the changes over time. [CESS WP 81].
    Keywords: Traditional Knowledge, tribal farmers, agriculture, Pradhan tribe, adilabad district, knowledge, scentific research, innovators, indigenous community, geographic area, local communities, legends, folklore, rituals, songs, developing societies, Andhra Pradesh, Sustainable Development
    Date: 2010
  4. By: Dubois, Pierre; Ligon, Ethan (University of California, Berkeley. Dept of agricultural and resource economics)
    Abstract: Using data on individual consumption from farm households in the Philippines, we construct a direct test of risk-sharing within the household. We contrast the efficient outcomes predicted by the unitary household model with the outcomes we might expect if food consumption delivers not only utils, but also nutrients affecting future productivity. The efficiency conditions which characterize the within-household allocation of food under the unitary model are violated, as consumption responds to earnings shocks. If productivity depends on nutrition, this explains some but not all of the response, as earnings "surprises" have some effect on the cost and composition of diet.
    Date: 2010–01
  5. By: Paul Sarfo-Mensah (Kwame Nkrumah University of Science and Technology (KNUST)); William Oduro (Faculty of Renewable Natural Resources, CANR, KNUST)
    Abstract: The potential of traditional natural resources management for biodiversity conservation and the improvement of sustainable rural livelihoods is no longer in doubt. In sub-Saharan Africa, extensive habitat destruction, degradation, and severe depletion of wildlife, which have seriously reduced biodiversity and undermined the livelihoods of many people in rural communities, have been attributed mainly to the erosion of traditional strategies for natural resources management. In Ghana, recent studies point to an increasing disregard for traditional rules and regulations, beliefs and practices that are associated with natural resources management. Traditional natural resources management in many typically indigenous communities in Ghana derives from changes in the perceptions and attitudes of local people towards tumi, the traditional belief in super natural power suffused in nature by Onyame, the Supreme Creator Deity. However, this is closely entwined with ecological, demographic and economic factors. Whilst these factors have driven the need to over-exploit natural resources, a situation which threatens the sustainability of community forests including sacred groves, religion has been used to justify such actions. This paper explores changes in tumi and the sustainability of sacred groves in the forest-savanna transitional zone in Ghana. It would confirm that changes in traditional animist beliefs, such as tumi, which informs the worldview of local people and underlies traditional natural resources management, is mainly due to the advances made by Christianity and Islam.
    Keywords: Tumi, Sacred Groves, Forest-Savanna Transition, Sustainability, Traditional, Christianity, Islam
    JEL: Z1
    Date: 2010–01
  6. By: Haskel, Jonathan (Imperial College London); Wallis, Gavin (University College London)
    Abstract: Pressure on public finances has increased scrutiny of public support for innovation. We examine two particular issues. First, there have been many recent calls for the (relatively new) UK R&D subsidy to be extended to other “research” activities, such as software. Second, argument still rages about the efficacy of direct public spending on R&D via spending on academic research councils, universities, and government undertaken work on civil and military R&D. To evaluate these questions we use data on market sector productivity, R&D and non-R&D intangible assets, and public sector R&D spending. We look for evidence of market sector spillovers from intangible investment and from public R&D. We find (a) no evidence of spillover effects from intangible investment at the market sector level, including from R&D, (b) strong evidence of market sector spillovers from public R&D spend on research councils, and (c) no evidence of market sector spillovers from public spending on civil or defence R&D. Our findings tentatively suggest that for maximum market sector productivity impact government innovation policy should focus on direct spending on research councils.
    Keywords: intangible assets, productivity, R&D, spillovers
    JEL: O47 E22
    Date: 2010–02
  7. By: Giuseppe De Luca (ISFOL); Luigi Franco Peracchi (Tor Vergata University, EIEF)
    Abstract: We consider a general sample selection model for a single cross-section that simultaneously takes into account selectivity due to unit and item nonresponse, endogeneity problems, and issues related to flexible specification of the relationship of interest. We estimate both parametric and semiparametric specifications of the model. The parametric specification assumes that the unobservables in the model follow a multivariate Gaussian distribution. The semiparametric specification avoids distributional assumptions about the unobservables. We apply the model to the problem of estimating the food Engel curve using data from the first wave of the Survey on Health, Aging and Retirement in Europe (SHARE).
    JEL: B12 C14 C31 C34
    Date: 2010
  8. By: Miranowski, John; Rosburg, Alicia
    Abstract: The objectives of this paper include: 1) developing an economic framework to estimate long run equilibrium breakeven prices that cellulosic ethanol processors can pay for the marginal or last unit of biomass feedstock they purchase and still breakeven and that cellulosic feedstock producers need to receive for supplying the last unit of feedstock delivered to a commercial-scale plant; 2) estimating the gap or difference between the biorefinery’s willingness to pay (WTP) or derived demand for the last unit of cellulosic feedstock and the suppliers’ willingness to accept (WTA) or marginal cost (MC) of supplying the last unit of feedstock; 3) completing a life-cycle analysis (LCA) of each feedstock alternative or a “well-to-wheels” accounting of the potential greenhouse gas (GHG) savings associated with feedstock-specific ethanol relative to gasoline; and 4) calculating the carbon price or credit necessary for a biofuel market to exist in the long run. The model is designed to address various policy issues related to cellulosic biofuel production, including cellulosic biofuel production costs, the cost of cellulosic feedstock production when accounting for all costs incurred, government intervention costs either through tax credits and other incentives needed to sustain biofuel markets or through mandates to achieve the revised Renewable Fuels Standard (RFS.2), and finally, the implicit price or credit for CO2e embodied in cellulosic biofuel.
    Date: 2010–02–24
  9. By: Paulo A.L.D. Nunes (University of Venice); Helen Ding (Ca’ Foscari University of Venice and Fondazione Eni Enrico Mattei); Sonja Teelucksingh (ondazione Eni Enrico Mattei and University of the West Indies)
    Abstract: This paper reports an original economic valuation of the impact of climate change on the provision of forest regulating services in Europe. To the authors’ knowledge the current paper represents the first systematic attempt to estimate human well-being losses with respect to changes in biodiversity and forest regulating services that are directly driven by climate change. First, selected 34 European countries are grouped by their latitude intervals to capture the differentiated regional effects of forests in response to climate change. Moreover, the future trends of forest areas and stocked carbon in 2050 are projected through the construction and simulation of global circulation models such as HADMC3 following four different future developing paths described by the four IPCC scenarios. Finally, the valuation exercise is anchored in an ecosystem service based approach, involving the use of general circulation models and integrated assessment models. Our findings address two dimensions in the evaluation of climate impacts on European forests: Firstly, future projections yield different states of the world depending upon the IPCC scenario adopted. Secondly, spatial issues matter in an assessment of the distributional impacts of climate change, as these impacts are not distributed in a uniform way across the European countries under consideration.
    Keywords: Economic Valuation, Forest Ecosystem, Carbon Sequestration, Climate Change Impacts
    JEL: Q23 Q51 Q57
    Date: 2010–01
  10. By: Karligash Kenjegalieva (Dept of Economics, Loughborough University); Richard Simper (Dept of Economics, Loughborough University)
    Abstract: This paper develops a new Luenberger productivity which is applied to a technology where the desirable and undesirable outputs are jointly produced and are possibly negative. The components of this Luenberger productivity index - the efficiency change and the components of the technological shift - are then decomposed into factors determined by the technology, adjusted for ‘risk and environment’, ‘risk management’ and ‘environmental effects’. The method is applied to Central and Eastern European banks operating during 1998–2003 utilising three alternative input/output methodologies (intermediation, production and profit/revenue). Additionally, the comparative analysis of the sensitivity of the productivity indices in the choice of the methodologies is undertaken using statistical and kernel density tests. It is found that the main driver of productivity change in Central and Eastern European banks is technological improvement, which, in the beginning of the analysed period, hinged on the banks’ ability to capitalise on advanced technology and successfully take into account risk and environmental factors. Whereas, in the later sampled periods, we show that one of the most important factors of technological improvement/decline is risk management. Finally, the tests employed confirm previous findings, such as Pasiouras (2008) in this journal, that different input/output methodologies produce statistically different productivity results. Indeed, we also find that external factors, such as a risk in the economy and banking production, and a ‘corruption perception’ affect the productivity of banks.
    Keywords: Luenberger productivity index; DEA; banking; undesirable outputs; negative data.
    JEL: C14 G2 L1
    Date: 2010–01
  11. By: Jan J. J. Groen; Paolo A. Pesenti
    Abstract: In this paper we seek to produce forecasts of commodity price movements that can systematically improve on naive statistical benchmarks, and revisit the forecasting performance of changes in commodity currencies as efficient predictors of commodity prices, a view emphasized in the recent literature. In addition, we consider different types of factor-augmented models that use information from a large data set containing a variety of indicators of supply and demand conditions across major developed and developing countries. These factor-augmented models use either standard principal components or partial least squares (PLS) regression to extract dynamic factors from the data set. Our forecasting analysis considers ten alternative indices and sub-indices of spot prices for three different commodity classes across different periods. We find that the exchange rate-based model and especially the PLS factor-augmented model are more prone to outperform the naive statistical benchmarks. However, across our range of commodity price indices we are not able to generate out-of-sample forecasts that, on average, are systematically more accurate than predictions based on a random walk or autoregressive specifications.
    JEL: C23 C53 F47
    Date: 2010–02

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