New Economics Papers
on Agricultural Economics
Issue of 2010‒06‒04
24 papers chosen by

  1. Trade Competitiveness, Subsidies and Barriers to Trade:Implication for Indian Agriculture By Bandhu, Yogesh
  2. Patterns and Trends in Food Staples Markets in Eastern and Southern Africa: Toward the Identification of Priority Investments and Strategies for Developing Markets and Promoting Smallholder Productivity Growth. By Jayne, Thomas; Mason, Nicole; Myers, Bob; Ferris, Jake; Mather, David; Beaver, Margaret; Lenski, Natalie; Chapoto, Antony; Boughton, Duncan
  3. The Dynamics of Farm Land Allocation – Short and Long Run Reactions in a Long Micro Panel By Søren Arnberg; Lars Gårn Hansen
  4. Analysis of socio-economic aspects of local and national organic farming markets By Lobley, Matt; Butler, Allan; Courtney, Paul; Ilbery, Brian; Kirwan, James; Maye, Damian; Potter, Clive; Winter, Michael
  5. Etude sur la transmission des fluctuations et le calcul des prix de parité à lâimportation: cas pratique du riz et du maïs au Sénégal By Ndiaye, Mouhamadou; Niang, Moussa
  6. The Export-Production Decision of Chilean Farmers: Implications for Chileâs Agricultural and Export Policies By Echeverria, Rodrigio; Gopinath, Munisamy
  7. Study on Agrarian Contracts in Bulgaria By Bachev, Hrabrin
  8. Total Factor Productivity in Thai Agriculture Measurement and Determinants By Waleerat Suphannachart; Peter Warr
  9. Optimal Farm Size under an Uncertain Land Market: the Case of Kyrgyz Republic By Sara Savastano; Pasquale Lucio Scandizzo
  10. On the Role of Government in Food Staples Markets: Perspectives from Recent Research and Implications for Mozambique By Tostão, Emilio; Tschirley, David L.
  11. Small Farmers and Big Retail: trade-offs of supplying supermarkets in Nicaragua By Michelson, Hope; Reardon, Thomas; Perez, Francisco
  12. Cash Crop Choice and Income Dynamics in Rural Areas: Evidence for Post-Crisis Indonesia By Stephan Klasen; Jan Priebe; Robert Rudolf
  13. How Related Are the Prices of Organic and Conventional Corn and Soybean? By Singerman, Ariel; Lence, Sergio H.; Kimble-Evans, Amanda
  14. Economics and Efficiency of Organic Farming vis-à-vis Conventional Farming in India By D. Kumara Charyulu; Subho Biswas
  16. Does Shelf-Labeling of Organic Foods Increase Sales? Results from a Natural Experiment By Daunfeldt, Sven-Olov; Rudholm, Niklas
  17. Notes on the Economics of Control of Wildlife Pests By Tisdell, Clem
  18. A Semi-parametric Analysis of Technology, with an Application to U.S. Dairy Farms By de los Campos, Gustavos; Foltz, Jeremy; Chavas, Jean-Paul; Gianola, Daniel
  19. An Analysis of Bundle Pricing in Horizontal and Vertical Markets: The Case of the U.S. Cottonseed Market By Shi, Guanming; Stiegert, Kyle; Chavas, Jean-Paul
  20. An Analysis of the Pricing of Traits in the U.S. Corn Seed Market By Shi, Guanming; Chavas, Jean-Paul; Steigert, Kyle
  21. Mobile payments in the United States at retail point of sale: current market and future prospects By Marianne Crowe; Marc Rysman; Joanna Stavins
  22. Disentangling Purchasing Motives from Socio-demographic Differences: The case of Organic Milk By Laura Mørch Andersen
  23. Climate, population and famine in Northern Italy: General tendencies and Malthusian crisis, ca. 1450-1800 By Guido Alfani
  24. Managing Forests for Sustainable Economic Development: Optimal Use and Conservation of Forests By Tisdell, Clement Allan

  1. By: Bandhu, Yogesh
    Abstract: Agriculture in India is the most important segment of the economy. Growth of Agricultural sector is crucial for Indian economy as it employs two-third of its population and contributes nearly one-third of national income. However its importance in the economic, social and political fabric of India goes well beyond what is indicated by its contribution to the economy. The large number of poor agricultural households and their income vulnerability are major concern among policy makers. These concerns have driven both agricultural policies and public expenditures in agriculture in India as well as in other part of the globe. India made significant advances towards achieving its goal of rapid agricultural growth, improving food security, and reducing rural poverty during the last four decades. Sustainable food production growth enabled India to achieve foodgrain self sufficiency, eliminating the threat of famines and acute starvation in the country. More rapid agricultural productivity growth, as past experiences shows, can have major impacts on poverty reduction trough direct effects on producers income, indirect effects on consumer welfare trough changes in food prices, employment and wage effects, and growth induced effects throughout the economy. Agriculture is also one of the major sources of export earnings of our country and is crucial for improving the balance of payments. In recent years, the export of agricultural and allied products accounted for about one-fifth of total export earnings of India. India's share of agricultural export has remained very low in many commodities despite inherent strength of Indian agriculture with the exception of few commodities. The performance of agricultural export depends not only on adequate surplus, international prices, quality of product, market competition and comparative advantage of producing the exportable commodities but also on domestic and international trade policy. Hence the subsidies and supports to agricultural commodities of country play a major role to stand in international market. Present paper is an effort to evaluate competitiveness of Indian wheat and rice in international market. Keeping in view the overall foodgrain production, marketable surplus and number of farmers, among the major foodgrain producing states, Uttar Pradesh has been taken for comparison of trade competitiveness. Since agricultural trade is highly distorted due to huge subsidies and support to agriculture in developed countries; paper also evaluate competitiveness of these commodities in alternative case if both countries withdraw their subsidies to these commodities in form of Producer Support Estimate (PSE). The Paper is divided in four parts; Part one is about the methodology to calculate competitiveness. Trade competitiveness of wheat and rice at normal prices and at PSE adjusted prices has been calculated in part two. Part three evaluate the implications of agricultural subsidy and part four is the concluding part with suggesting some corrective measures for fair agricultural trade and due space of developing countries in international agricultural trade.
    Keywords: Trade competitiveness; Subsidies; WTO; Indian Agriculture
    JEL: F00 F13 Q17 F1
    Date: 2009–10
  2. By: Jayne, Thomas; Mason, Nicole; Myers, Bob; Ferris, Jake; Mather, David; Beaver, Margaret; Lenski, Natalie; Chapoto, Antony; Boughton, Duncan
    Abstract: Accurate information on farmer and consumer behavior is the foundation for Identifying public investments and policies that can effectively promote national food security and income growth objectives. This report synthesizes recent findings on smallholder crop marketing behavior and urban consumption patterns in Eastern and Southern Africa, and their implications for public sector investments and policies to promote smallholder incomes and national food security.
    Keywords: food security, africa, smallholder markets, Agribusiness, Agricultural and Food Policy, Agricultural Finance, Community/Rural/Urban Development, Crop Production/Industries, International Development, Marketing, q14, q13, q12, q11,
    Date: 2010–04
  3. By: Søren Arnberg (Danish Economic Counsils); Lars Gårn Hansen (Institute of Food and Resource Economics, University of Copenhagen)
    Abstract: This study develops a dynamic multi-output model of farmers’ crop allocation decisions that allows estimation of both short-run and long-run adjustments to a wide array of economic incentives. The method can be used to inform decision-makers about a number of issues including agricultural policy reform and environmental regulation. The model allows estimation of dynamic effects relating to price expectations adjustment, investment lags and crop rotation constraints. Estimation is based on micro-panel data from Danish farmers that includes acreage, output and variable input utilisation at the crop level. Results indicate that there are substantial differences between the shortrun and long-run land allocation behaviour of Danish farmers and that there are substantial differences in the time lags associated with different crops. Since similar farming conditions are found in northern Europe and parts of the USA and Canada, this result may have more general interest.
    Keywords: land allocation, crop rotation, system of dynamic equations, micro panel data, GMM
    JEL: C33 Q12 Q15
    Date: 2010–05
  4. By: Lobley, Matt; Butler, Allan; Courtney, Paul; Ilbery, Brian; Kirwan, James; Maye, Damian; Potter, Clive; Winter, Michael
    Abstract: The purpose of this study was to take a fresh look at the nature of organic production, consumption and marketing in England and Wales in order to better assess its current and likely contribution to rural development and its ability to meet consumer expectations. Based on a mixed methodological approach the study consulted with 2,300 individuals to reveal a complex and multi-dimensional sector with a highly committed consumer base. The research aimed to describe and account for: (1)The socio-economic impacts of the organic farm supply chains on rural development; (2)The extent to which organic food delivers consumer expectations; and (3) The barriers affecting conversion to organic farming and expansion of existing organic farms. The research reported here is arguably one of the most integrated studies of organic consumption, production and marketing conducted to date. It throws new light on the nature of organic consumption, underlining both the on-going commitment of the majority of committed organic consumers and the gap in perceptions, degrees of âbrand trustâ and price sensitivity between this group and the majority of consumers who rarely or never buy organic. While this degree of commitment suggests that recent declines in organic consumption may not be sustained and will soon hit a floor, this finding also points to difficulties, particularly in a time of recession, in enrolling new consumers into organic networks, particularly via the direct marketing channels that smaller producers are more likely to depend on. This group of producers, locally embedded and linked to consumers via short supply chains, fulfil the expectations of many organic consumers and exemplify the idea of alternative food producers. Managed by self selecting, entrepreneurial farmers, these organic producers make a valuable contribution towards employment and income generation within the local rural economy. As our broader analysis of food chains and multiplier effects across the regional and national rural economy shows, however, it is the large scale producers, concerned with the production of bulk commodities and integrated into long supply chains, that inevitably account for the main rural employment and income benefits of the organic sector, if measured in aggregate terms. While there is a good case to be made for the rural development benefits of organic farming, it is important to recognise these scale effects and their geographically uneven distribution in any policy assessment.
    Keywords: Organic markets, Organic farming, Organic consumers, Rural Economy, Multiplier Analysis, Simple Value Chains, Agricultural and Food Policy, Consumer/Household Economics, Farm Management, Food Consumption/Nutrition/Food Safety, Marketing,
    Date: 2009–07
  5. By: Ndiaye, Mouhamadou; Niang, Moussa
    Abstract: Calculation of maize and rice parity prices in Senegal.
    Keywords: food security, Senegal, markets, parity prices, Agricultural and Food Policy, Community/Rural/Urban Development, Food Security and Poverty, International Development, Marketing, q11, q18,
    Date: 2010–01
  6. By: Echeverria, Rodrigio; Gopinath, Munisamy
    Keywords: International Relations/Trade,
    Date: 2010–05–10
  7. By: Bachev, Hrabrin
    Abstract: This paper suggests a holistic framework for analysis of agrarian contracts and investigates the contractual structure in transitional Bulgarian agriculture. Firstly, it incorporates the interdisciplinary New Institutional and Transaction Costs Economics (combining Economics, Organization, Law, Sociology, Behavioral and Political Sciences) and describes major mechanisms of governance of agrarian activity – institutional environment, market competition, private, collective and public order; and defines features of agrarian sale-purchase, lease, employment, service, loan, insurance and coalition contracts; and identifies technological, institutional, behavioral, dimensional, and transaction costs factors for contractual choice and specifies effective modes for contractual arrangements in agriculture; and determines the effective boundaries and sustainability of farm and agrarian organizations. Secondly, it analyzes the post-communist institutional and organizational modernization of Bulgarian agriculture, and assesses the efficiency of various modes for governing of land supply, and labor supply, and service supply, and inputs supply, and finance supply, and insurance supply, and marketing of output in different type of farms.
    Keywords: mechanisms of governance; contract management; type of agrarian contracts; factors and efficiency of contractual choice; economic boundaries and sustainability of farm; transitional agriculture; Bulgaria
    JEL: L11 M55 J54 L14 M31 D71 Q13 L23 Q15 J33 D21 K12 Q12 D23 J43 O17 M51 L22
    Date: 2010–05–20
  8. By: Waleerat Suphannachart (Department of Agricultural and Resource Department, Kasetsart University); Peter Warr (The Australian National University, Canberra, Australia)
    Abstract: This paper studies total factor productivity (TFP) in Thai agriculture to provide better empirical evidence on the TFP measure and the factors influencing it. It employs time-series data at an aggregate level over the period 1970-2006 for both crops and livestock,individually, using the conventional growth accounting framework. The TFP measures are then used to investigate their determinants using the error correction modeling technique. The results confirm the general expectation from previous studies that TFP makes an important contribution to output growth and that agricultural research plays an important role in determining TFP in both the crop and livestock sectors.
    Keywords: total factor productivity, TFP decomposition, Thai agriculture
    JEL: O40 Q19
    Date: 2010–04
  9. By: Sara Savastano (Faculty of Economics, University of Rome "Tor Vergata"); Pasquale Lucio Scandizzo (Faculty of Economics, University of Rome "Tor Vergata")
    Abstract: The paper illustrates a theoretical model of real option value applied to the problem of land development. Making use of the 1998-2001 Kyrgyz Household Budget Survey, we show that when the hypothesis of decreasing return to scale holds, the relation between the threshold value of revenue per hectare and the amount of land cultivated is positive. In addition to that, the relation between the threshold and the amount of land owned is positive in the case of continuous supply of land and negative when there is discontinuous supply of land. The direct consequence is that, in the first case, smaller farms will be more willing to rent land and exercise the option where, in the second case, larger farms will exercise first. The results corroborate the findings of the theoretical model and suggest three main conclusions: (i) the combination of uncertainty and irreversibility is a significant factor in the land development decisions, (ii) farmers’ behaviour is consistent with the continuous profit maximization model, (iii) farming unit revenue tends to be positively related to farm size, once uncertainty is properly accounted for.
    Keywords: Option value theory, Farm size, Uncertainty, irreversibility.
    JEL: O13 Q12 Q15 Q18
    Date: 2010–05–28
  10. By: Tostão, Emilio; Tschirley, David L.
    Abstract: This brief reviews results of applied research regarding the role of government in staple food markets in East and Southern Africa. The purpose of the brief is to draw lessons for Mozambique as it decides how to use the grain storage silos it has been building since 2009. The authors suggest that: Mozambique is in an unusually strong position to take advantage of private sector activity to stabilize prices over time and space; Additional investment in road and rail infrastructure, incentives, and institutions, would help bring down transaction costs and allow private action to further stabilize prices; Additional stabilization, for those times when Mozambique has to rely on imports from the world market beyond what they normally make, could be obtained in a cost efficient manner using a financial reserve; and If the government chooses also to maintain a public physical reserve, then several conditions (listed in the brief) are necessary for operating this in a manner that improves market performance.
    Keywords: Africa, Mozambique, food security, Agribusiness, Agricultural and Food Policy, Agricultural Finance, Community/Rural/Urban Development, International Development, Marketing, q18, q13, q12,
    Date: 2010–03
  11. By: Michelson, Hope; Reardon, Thomas; Perez, Francisco
    Abstract: In Nicaragua and elsewhere in Central America, small-scale farmers are weighing the risks of entering into contracts with supermarket chains. We use unique data on negotiated prices from Nicaraguan farm cooperatives supplying supermarkets to study the impact of supply agreements on producersâ mean output prices and price stability. We find that prices paid by the domestic retail chain approximate the traditional market in mean and variance. In contrast, we find that mean prices paid by Wal-mart are significantly lower than the traditional market but that Wal-Mart systematically reduces price volatility compared with the traditional market. We find some evidence, however, that farmers may be paying too much for this contractual insurance against price variation.
    Keywords: Nicaragua, Supermarkets, Wal-Mart, Modern Retail, Market Risk, Contracts, Supply Chains, Agribusiness, International Development,
    Date: 2010–04
  12. By: Stephan Klasen (Georg-August-University Göttingen); Jan Priebe (Georg-August-University Göttingen); Robert Rudolf (Georg-August-University Göttingen)
    Abstract: In this paper we investigate the factors affecting income levels, income growth, and poverty reduction in rural Indonesia following the crisis of 1997/98. We particu- larly investigate the relative roles of non-farm incomes, productivity improvements achieved via changes in crops versus improvements on the same crops, and demographic changes induced by the crisis on income dynamics in rural Indonesia. Using a unique household panel data set for Central Sulawesi that allows us to control for a large set of household and geographical characteristics, household fixed effects as well as endogeneity issues, we find that falling household size and the adoption and intensification of new cash crop varieties can explain a substantial part of the observed post-crisis developments. Moreover, we compare our results to cross-sectional data from SUSENAS, Indonesia\'s large scale national household survey. While the overall determinants of rural incomes are very similar across both data sets, we find that the importance of agricultural self-employed income seems to be higher in Central Sulawesi than in most other parts of Indonesia. Although several factors could explain these differences, lessons from our Central Sulawesi data suggests that unexploited potentials in the production of cash crops in other areas of Indonesia might contribute to these findings.
    Keywords: Crop choice; Income diversification; non-farm sector; rural development; Indonesia
    JEL: I31 Q12 Q15 R13
    Date: 2010–05–26
  13. By: Singerman, Ariel; Lence, Sergio H.; Kimble-Evans, Amanda
    Abstract: Cointegration is tested between organic and conventional corn and soybean markets in several locations throughout the U.S. using a unique data set. Organic prices are found to behave like jump processes rather than diffusions, and Monte Carlo methods are developed to compute appropriate critical values for such tests. Findings indicate that no long-run relationship exists between organic and conventional prices, implying that price determination for organic corn and soybean is independent from that for the conventional crops. This suggests that organic corn and soybean prices are driven by demand and supply forces idiosyncratic to the organic market. For each crop, cointegrating spatial relationships are found between prices at the main organic markets. However, such relationships are generally weaker than the ones for the corresponding conventional prices, implying that organic markets are more affected by idiosyncratic shocks than conventional markets.  
    Keywords: cointegration; jump process; organic crops; organic production; price analysis; organic price premiums
    Date: 2010–05–25
  14. By: D. Kumara Charyulu; Subho Biswas
    Abstract: The present paper focuses mainly on the issues like economics and efficiency of organic farming visà- vis conventional farming in India. Four states namely Gujarat, Maharashtra, Punjab and U.P were purposively selected for the present study. Similarly, four major crops i.e., cotton, sugarcane, paddy and wheat were chosen for comparison. A model based nonparametric Data Envelopment Analysis (DEA) was used for analyzing the efficiency of the farming systems.
    Keywords: India, cotton, data, Gujarat, maharashtra, punjab, UP, padday, non-parametric, economics, efficiency, organic farming, conventional farming, DEA analysis,
    Date: 2010
  15. By: Ashenfelter, Orley; Storchmann, Karl
    Abstract: In this paper we measure the effect of year to year changes in the weather on wine prices and winery revenue in the Mosel Valley in Germany in order to determine the effect that climate change is likely to have on the income of wine growers. A novel aspect of our analysis is that we compare the estimates based on auction, retail, and wholesale prices. Although auction prices are based on actual transactions, they provide a thick market only for high quality, expensive wines and may overestimate climateâs effect on farmer revenues. Wholesale prices, on the other hand, do provide broad coverage of all wines sold and probably come closest to representing the revenues of farmers. Overall, we estimate a 1°C increase in temperature would yield an increase in farmer revenue of about 30 percent.
    Keywords: wine, global warming, auction prices, retail prices, wholesale prices, Demand and Price Analysis, Environmental Economics and Policy,
    Date: 2010–05
  16. By: Daunfeldt, Sven-Olov (The Ratio Institute and Dalarna University); Rudholm, Niklas (The Swedish Retail Institute (HUI) and Dalarna University)
    Abstract: Can a simple point-of-purchase (POP) shelf-label increase sales of organic foods? We use a random-effects, random-coefficients model, including a time adjustment variable, to test data from a natural experiment in a hypermarket in Gävle, Sweden. Our model incorporates both product specific heterogeneity in the effects of labeling and consumer adjustment to the labels over time. The introduction of POP displays was found to lead to an increase in sales of organic coffee and olive oil, but a reduction in sales of organic flour. All targeted products became less price-sensitive. The results reveal that product specific heterogeneity has to be accounted for, and in some cases consumers adjusted to labeling over time.
    Keywords: Product labeling; random coefficient models; ecological products; experimental economics
    JEL: L66 L81 M31 M37
    Date: 2010–05–26
  17. By: Tisdell, Clem
    Abstract: Some wildlife species are agricultural pests but these populations are often valued by other than agriculturalists. For non-farmers, the population levels of such wildlife are frequently pure public goods. This is one source of market failure in the economically optimal social control of an agricultural pest of this type. Secondly, if the species is geographically mobile, externalities occur between farmers in the control of the species, and this reduces the incentives of farmers as individuals to control the pest species. It is shown that depending on the relative strength of these opposing types of market failure, farmers may excessively reduce or insufficiently decrease the population of a species from a social economic point of view.
    Keywords: agriculture, market failure, mobility of pests, pest control, pure public goods., Environmental Economics and Policy, Q57,
    Date: 2010–05
  18. By: de los Campos, Gustavos (University of Alabama, Birmingham); Foltz, Jeremy (University of Wisconsin); Chavas, Jean-Paul (University of Wisconsin); Gianola, Daniel (University of Wisconsin)
    Abstract: This article proposes a semi-parametric stochastic frontier model (SPSF) in which components of the technology and of technical efficiency are represented using semi-parametric methods and estimated in a Bayesian framework. The approach is illustrated in an application to US farm data. The analysis shows important scale economies for small and medium herds and constant return to scale for larger herds. With the exception of labor, estimates of marginal products were close to the value expected under profit maximization. Finally, the results suggest important opportunities to increase productivity through reductions in technical inefficiencies.
    Date: 2010–03
  19. By: Shi, Guanming (University of Wisconsin); Stiegert, Kyle (University of Wisconsin); Chavas, Jean-Paul (University of Wisconsin)
    Abstract: In this paper, we investigate substitution/complementarity relationships among products sold with different bundled characteristics and under different vertical arrangements. Our conceptual model demonstrates the interactive price impacts emanating from product differentiation, market concentration and market size. The model is applied to the U.S. cottonseed market using transaction level data from 2002 to 2007. This market has been impacted structurally in numerous ways due to the advances and the rapid adoption of seeds with differing bundles of biotechnology traits and vertical penetration emanating from the biotechnology seed industry. Several interesting findings are reported. The econometric investigation finds evidence of sub-additive pricing in the bundling of patented biotech traits. Vertical organization is found to affect pricing and the exercise of market power. While higher market concentration is associated with higher prices, there is also evidence of cross-product complementarity effects that lead to lower prices. Simulation methods are developed to measure the net price effects. These simulations are applicable for use in pre-merger analysis of industries producing differentiated products and exhibiting similar market complexities.
    JEL: L13 L40 L65
    Date: 2009–12
  20. By: Shi, Guanming (University of Wisconsin); Chavas, Jean-Paul (University of Wisconsin); Steigert, Kyle (University of Wisconsin)
    Abstract: This paper investigates the pricing of patented traits in the U.S. hybrid corn seed market under imperfect competition. In a multiproduct context, we first examine how substitution/complementarity relationships among products can affect pricing. This is used to motivate multi-product generalizations of the Herfindahl-Hirschman index (GHHI) capturing cross-market effects of imperfect competition on bundle pricing. The GHHI model is applied to pricing of conventional and patented biotech seeds in the US from 2000-2007. One major finding is that standard component pricing in biotech traits is soundly rejected in favor of subadditive bundle pricing. The econometric estimates show how changes in market structures (as measured by both own- and cross-Herfindahl indexes) affect U.S. corn seed prices.
    JEL: L13 L40 L65
    Date: 2009–12
  21. By: Marianne Crowe; Marc Rysman; Joanna Stavins
    Abstract: Although mobile payments are increasingly used in some countries, they have not been adopted widely in the United States so far, despite their potential to add value for consumers and streamline the payments system. After describing a few countries’ experiences, we analyze the prospects for the U.S. market for mobile payments in retail payments, particularly the use of contactless and near-field communication technologies. We identify conditions that have facilitated some success in other countries and barriers to the adoption of mobile payments in the United States. On the demand side, consumers and merchants are well served by the current card system, and face a low expected benefit-cost ratio, at least in the short run. On the supply side, low market concentration and strong competitive forces of banks and mobile carriers make coordination of standards difficult. Furthermore, mobile payments are characterized by a network effects problem: consumers will not demand them until they know that enough merchants accept them, and merchants will not implement the technology until a critical mass of consumers justifies the cost of doing so. We present some policy recommendations that the Federal Reserve should consider.
    Keywords: Mobile commerce - United States ; Payment systems
    Date: 2010
  22. By: Laura Mørch Andersen (Institute of Food and Resource Economics, University of Copenhagen)
    Abstract: Using a unique data set where an unbalanced panel of more than 1,000 households have reported their purchases of groceries in great detail over a period of six months it is shown that consumption of organic milk increases significantly with level of education, urbanisation and income. Age and presence of children in the household have no significant effects. Combining the purchase data with a questionnaire about attitudes towards organic production issued to the same panel shows that 51 per cent believes that organic production has a positive effect on the environment and 41 per cent believes in a positive effect on their own health. The level of trust in organic products generally increases with level of education, urbanisation and income. Including perception of organic goods in the estimation therefore reduces the effects of these socio-demographics, and thereby demonstrates the strength of this type of data combination. It turns out that both trusts in effect on environment and on health increases the probability of choosing organic milk significantly. The effect of trust in health is more than twice as big as the effect of trust in environment.
    Keywords: panel mixed multinomial logit, labelling, characteristics model, health, environment, organic
    JEL: Q51 Q13 D12 C25
    Date: 2010–05
  23. By: Guido Alfani
    Abstract: This article provides a picture of long-term developments in the relationship between population and resources in Northern Italy that takes fully into account climate. It analyzes both the slow underlying development of climatic conditions over the centuries (in the theoretical framework of the Little Ice Age) and the consequences of short-term periods of heightened instability. The most severe famines are shown to be events triggered by climatic and environmental factors operating at a time when the maximum carrying capacity of the system had been reached or, at least, when the population was exerting considerable pressure on the potential for food production. This is the case of the famine of the 1590s, the greatest demographic catastrophe of a non-epidemic nature to strike Northern Italy since the Black Death and up to the end of the eighteenth century. The article also analyzes long-term paths of agrarian innovation, suggesting that most (but not all) of this was consistent with Boserup’s idea of chain-reactions of innovations induced by demographic pressure. These processes, though, were too slow to compensate for a rapidly growing population. Finally, the article provides a periodization in which the period between the famine of the 1590s and the great plague pandemic of 1630 is shown to be the crucial turning point in how population dynamics, climate and agrarian innovation interacted.
    Keywords: history of climate, plague, famine, Little Ice Age, Malthusian crisis, Early Modern Italy, agrarian innovation
    Date: 2010–05
  24. By: Tisdell, Clement Allan
    Abstract: The conservation of natural forests contributes significantly to the goal of achieving sustainable economic development. There is, however, growing concern that natural forests (which provide tangible and intangible economic benefits to humankind) are being lost at a rate which (combined with other factors) seriously threatens sustainable economic development because of the environmental and social impacts of such loss. There is little doubt that in order to achieve sustainable development, multifunctional forest ecosystems (as well as other important ecosystems) need to be managed appropriately. However, determining the socially optimal level of conservation and use of forests is a challenging task. From a human point of view, it is clearly not optimal to conserve all natural forests. In other words, only some conservation of natural forest is socially optimal. The extent to which (traditional) neoclassical economics elucidates the matter is explored. It is found that due to market failures, a larger amount of forest conversion occurs than is socially optimal as determined by the application of traditional welfare economics. Nevertheless, neoclassical economics fails to address adequately the requirements for sustainable economic development. When the goal of economic sustainability is taken into account, even less forest conversion than recommended by neoclassical economics is socially optimal. Some economists (for example, Ramsey and Pigou) claim that the sustainability shortcoming of neoclassical economics can be overcome by applying a zero discount rate in making decisions about resource use. This, however, does not solve the problem because it does not give enough weight to the welfare of future generations and may result in too much forest conversion from an economic sustainability viewpoint. In general, variations in the discount rate are ineffective as a means for determining measures that ensure sustainable economic development. This finding seriously undermines established economic theory.
    Keywords: Discount rates, ecosystem services, environmental conservation, forests, intergenerational equity, multifunctionality, resource economics, sustainable development, Community/Rural/Urban Development, Environmental Economics and Policy, Q20, Q23, Q56, Q57,
    Date: 2010–02

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