nep-agr New Economics Papers
on Agricultural Economics
Issue of 2010‒12‒18
eighteen papers chosen by
Angelo Zago
University of Verona

  1. The wanted change against climate change: assessing the role of organic farming as an adaptation strategy By Aravindakshan, Sreejith; Sherief, Aliyaru Kunju
  2. Inflation Dynamics and Food Prices in Ethiopia By Durevall, Dick; Loening, Josef L.; Birru, Yohannes A.
  3. Restoration of micro data of John Lossing Buck's survey and analysis of the inverse relationship between yield and farm size in rural China in the 1930's By Hoken, Hisatoshi
  4. As You Sow, So Shall You Reap: The Welfare Impacts of Contract Farming By Bellemare, Marc F.
  5. Linking Smallholders to Markets: Determinants and Impacts of Farmer Collective Action in Kenya By Elisabeth Fischer; Matin Qaim
  6. The Competitiveness of Small Household Pig Producers in Vietnam: Significant Research and Policy Findings from an ACIAR-sponsored Study and their Limitations By Tisdell, Clem
  7. Toward Partial Reorientation of Land Management for Sustainability in View of Material Circulation: Biophysical and Historical Analysis By Sylvie Ferrari; Kozo Mayumi; Jesus Ramos-Martin
  8. Stages of Agricultural Commercialization in Uganda: The Role of the Markets By Oleg Nivievskyi; Stephan von Cramon-Taubadel; Sergiy Zorya
  9. The Food-Feed-Fuel Triangle: Implications of Corn-based Ethanol for Grain-Use Competition By Arindam Banerjee
  10. The Dynamics of Farmers’ Market: A Case Analysis of “Uzhavar Sandhai†of Tamil Nadu By Murali Kallummal; K. Sakthi Srinivasan
  11. Emergence of a biofuel economy in Tanzania: Local developments and global connections from an institutional perspective By Saurabh Arora; Marjolein C.J. Caniëls; Henny Romijn
  12. Heterogeneous returns and the persistence of agricultural technology adoption By Andrew Zeitlin; Stefano Caria; Richman Dzene; Petr Janský; Emmanuel Opoku; Francis Teal
  13. A Healthy Mix? Health Food Retail and Mixed Use Development: Mobility-related Analysis of Grocery Shopping Behavior in Irvine, California By Benjamin Heldt
  14. Non-Tariff Barriers to Trade in Agricultural Products: Challenges for Brazilâs Beef Exports By De Miranda, Sílvia Helena Galvao; De Camargo Barros, Geraldo SantâAna
  15. The full economic cost of groundwater extraction By Strand, Jon
  16. Hunger, Malnutrition and Millennium Development Goals: What Can Be Done? By Vipin chandran, K.P; Sandhya, P
  17. Animal Health Economics. What Can It Do? What Are the Big Questions? By Tisdell, Clement A.
  18. Green Leader or Green Liar ? Differentiation and the role of NGOs. By Mireille Chiroleu-Assouline

  1. By: Aravindakshan, Sreejith; Sherief, Aliyaru Kunju
    Abstract: Conventional input intensive agriculture practised over the last century has been a major contributor to climate change, second only to energy sector. The communities engaged in pesticide and synthetic input rich agriculture is most vulnerable to the impacts of climate change. Many emerging economies including India have had the opportunity to develop National Adaptation Plans of Action in the context of the United Nations Framework Convention on Climate Change but implementation of those programmes and strategic links to resourcing actions are often lacking. Adaptation in the agricultural sector can be seen in terms of both short-term and long-term actions. Changing to organic farming systems is the most efficient and long term adaptation strategy. Organic agriculture is believed to be the most sustainable approach against climate change ensuring food security; it employs low external input and high output strategies. This paper attempts to review the potent role of organic agriculture as an adaptation strategy to deliver a tangible and hopeful alternative towards sustainable livelihood in the backdrop of climate change. The methodology involves thorough review of scientific literature. The study discusses the carbon sequestration achieved as well as reduction in emission with respect to low pesticide use and fossil fuel based farm machinery use in organic farming. The analysis of results concludes that the organic system of farming is the most resilient adaptation strategy against climate change and offer greater potential as a sustainable livelihood mechanism in times of climate transition.
    Keywords: adaptation; climate change; organic agriculture; sustainable livelihoods; vulnerability
    JEL: Q16 Q19 O13 Q54 Q10
    Date: 2010–01
  2. By: Durevall, Dick (Department of Economics, School of Business, Economics and Law, Göteborg University); Loening, Josef L. (World Bank); Birru, Yohannes A. (National Bank of Ethiopia)
    Abstract: During the global food crisis, Ethiopia experienced an unprecedented increase in inflation, among the highest in Africa. Using monthly data over the past decade, we estimate models of inflation to identify the importance of the factors contributing to CPI inflation and three of its major components: cereal prices, food prices, and non-food prices. Our main finding is that movements in international food and goods prices, measured in domestic currency, determined the long-run evolution of domestic prices. In the short run, agricultural supply shocks affected food inflation, causing large deviations from long-run price trends. Monetary policy seems to have accommodated price shocks, but money supply growth affected short-run non-food price inflation. Our results suggest that when analyzing inflation in developing economies with a large food share in consumer prices, world food prices and domestic agricultural production should be considered. Omitting these factors can lead to biased results and misguide policy decisions.<p>
    Keywords: Ethiopia; Exchange rate; Food prices; Inflation; Money demand
    JEL: E31 E37 O55 Q17
    Date: 2010–12–09
  3. By: Hoken, Hisatoshi
    Abstract: A large scale Chinese agricultural survey was conducted at the direction of John Lossing Buck from 1929 through 1933. At the end of the 1990’s, some parts of the original micro data of Buck’s survey were discovered at Nanjing Agricultural University. An international joint study was begun to restore micro data of Buck’s survey and construct parts of the micro database on both the crop yield survey and special expenditure survey. This paper includes a summary of the characteristics of farmlands and cropping patterns in crop yield micro data that covered 2,102 farmers in 20 counties of 9 provinces. In order to test the classical hypothesis of whether or not an inverse relationship between land productivity and cultivated area may be observed in developing countries, a Box-Cox transformation test was conducted for functional forms on five main crops of Buck’s crop yield survey. The result of the test shows that the relationship between land productivity and cultivated areas of wheat and barley is linear and somewhat negative; those of rice, rapeseed, and seed cotton appear to be slightly positive. It can be tentatively concluded that the relationship between cultivated area and land productivity are not the same among crops, and the difference of labor intensity and the level of commercialization of each crop may be strongly related to the existence or non-existence of inverse relationships.
    Keywords: China, Rural survey, Farm management, Farm survey, Crop yield
    JEL: N55 O12 Q12
    Date: 2010–08
  4. By: Bellemare, Marc F.
    Abstract: What is the impact of participation in agricultural value chains on the welfare of smallholders? Contract farming, wherein a processing firm delegates its production of agricultural commodities to growers, is often viewed as a means of increasing smallholder welfare in developing countries. Because the problem posed by the nonrandom participation of grower smallholders in contract farming has so far not been dealt with convincingly, however, whether participation in contract farming actually increases smallholder welfare is still up for debate. This paper uses an experimentally derived nonparametric measure of willingness to pay to enter contract farming to control for actual participation in contract farming. Using data from Madagascar, results indicate that participation in contract farming is associated with a 10- to 16-percent increase in income; a 15-percent decrease in income volatility; a two-month decrease in the duration of the hungry season; and a 31-percent increase in the likelihood of receiving a formal loan.
    Keywords: Contract Farming, Welfare, Grower-Processor Contracts, Outgrower Schemes
    JEL: L23 O13 L24 Q12 O14
    Date: 2010–07–03
  5. By: Elisabeth Fischer (Georg-August-University Göttingen); Matin Qaim (Georg-August-University Göttingen)
    Abstract: This article investigates determinants and impacts of cooperative organization, using the example of smallholder banana farmers in Kenya. Farmer groups are inclusive of the poor, although wealthier households are more likely to join. Employing propensity score matching, we find positive income effects for active group members. Yet price advantages of collective marketing are small, and high-value market potentials have not yet been tapped. Beyond prices, farmer groups function as important catalysts for innovation adoption through promoting efficient information flows. Some wider implications are discussed under what conditions collective action is useful, and through what mechanisms the potential benefits emerge.
    Keywords: agricultural markets; smallholder farmers; collective action; cooperative organization; Kenya; East-Africa
    Date: 2010–12–07
  6. By: Tisdell, Clem
    Abstract: The preamble to this paper highlights some of the major policy issues facing Vietnam as far as its supply of pork is concerned, in particular, the problem of its demand for pork rising at a faster rate than its supply. Some relevant background to this research project is provided by outlining selected features of Vietnamâs pig industry. Then the main findings (in the view of the author) from this ACIAR-funded research are presented. These results include (1) natural protection given to Vietnamâs pig producers from imports as a result of the nature of the preferences of Vietnamese consumers: (2) the importance of household labour, especially that provided by females, in the husbandry of pigs held by households; (3) the existence, or otherwise, of scale economies as a function of the number of pigs held by households and the economic efficiency of small producers, (4) the import dependence for pig food of Vietnamâs pig industry and the way in which it varies with the number of pigs kept by households; (5) specialization in pig production, (6) regional differences in the economics of pig production; (7) economic discrimination in the supply of inputs to household producers of pigs and in their sale of pigs; (8) the size of pig-holdings and the use of professional services, such as veterinary services and extension services; and (9) findings about miscellaneous matters, such as the genetic composition of the pig stock. Scope for future research in relation to these aspects is also highlighted, and the need is raised for considering the economics of increasing quality standards and certifying the quality of pork. The economics of increasing the scale of pig producing units is given particular attention. Vietnamâs policy options for improving the balance between its demand for pork and its supply are considered and the important role that household (small producers) have and can play in this regard are highlighted.
    Keywords: economic efficiency in pig production, economies of scale in pig production, gender and rural employment, household agricultural production, livestock development policy, natural trade protection, specialization in agricultural products, Vietnamâs pig industry., Agricultural and Food Policy, Community/Rural/Urban Development, Farm Management, Food Consumption/Nutrition/Food Safety, International Relations/Trade, Livestock Production/Industries, Q1,
    Date: 2010–11
  7. By: Sylvie Ferrari (Groupe de Recherche en Économie Théorique et Appliquée (GREThA), Research Group on Theoretical and Applied Economics, France); Kozo Mayumi (Faculty of Integrated Arts and Sciences, The University of Tokushima); Jesus Ramos-Martin (Departament d'Economia i d'Història Econòmica, Universitat Autònoma de Barcelona)
    Abstract: This paper explores two major issues, from biophysical and historical viewpoints. We examine land management, which we define as the long-term fertility maintenance of land in relation to agriculture, fishery and forestry. We also explore humans’ positive role as agents aiming to reinforce harmonious materials circulation within the land. Liebig’s view on nature, agriculture and land, emphasizes the maintenance of long-term land fertility based on his agronomical thought that the circulation of matter in agricultural fields must be maintained with manure as much as possible. The thoughts of several classical economists, on nature, agriculture and land are reassessed from Liebig’s view point. Then, the land management problem is discussed at a much more fundamental level, to understand the necessary conditions for life in relation to land management. This point is analyzed in terms of two mechanisms: entropy disposal on the earth, and material circulation against gravitational field. Finally from the historical example of the metropolis of Edo, it is shown that there is yet another necessary condition for the sustainable management of land based on the creation of harmonious material cycles among cities, farm land, forests and surrounding sea areas in which humans play a vital role as agent.
    Keywords: land management, material circulation, sustainability, Liebig, Edo
    JEL: Q10 A12 B10
    Date: 2010–12
  8. By: Oleg Nivievskyi (Institute for Economic Research and Policy Consulting, Kyiv, Ukraine); Stephan von Cramon-Taubadel (Georg-August-University Göttingen); Sergiy Zorya (World Bank)
    Abstract: Agricultural commercialization has become the centerpiece of the sector development strategy in Uganda in recent years. Nevertheless the low market participation of most smallholders in the country remains a fact. We employ semi-parametric regression techniques to analyze the current state of market participation and production diversification and to identify the determinants of commercialization in Uganda. We find that the key constraint to agricultural commercialization in Uganda is inadequate access of farmers to infrastructure and assets, both physical and human. Those with access to assets and closer to markets engage actively in the markets, while those lacking one or more of these essential ingredients largely do not. These findings are in line with the recent literature on smallholder market participation in Africa. We also find that commercialization proceeds in stages. When farmers have appropriate incentives and access to markets, they do not immediately separate production and consumption decisions. Instead they first diversify their production portfolios before subsequently increasing commercial specialization. The result is a U-shaped relationship between commercialization and diversification.
    Keywords: commercialization; diversification; smallholder agriculture; Uganda; semi-parametric regression
    Date: 2010–12–08
  9. By: Arindam Banerjee (Research and Information System for Developing Countries)
    Abstract: The contemporary world is witnessing certain critical changes in the domain of grain utilization. With the ongoing efforts to substitute fossil fuels with bio-fuels, there has been a rise in the importance of fuel-use of cereals. This adds a new dimension to the food-feed competition that emerged in the 20th century. Revisiting Yotopoulos’ food-feed competition model in the context of the large scale corn-ethanol production in the US, this paper attempts to draw out the new theoretical tenets of grain-use dynamics that have emerged with the new food-feed-fuel competition. The crude oil prices appear to play a more important role in the competition for grains between the various end-uses. Along with this, the equilibrating role that animal-feed has played in the grain-use dynamics in developed countries, with large middle-classes, is jeopardized with the advent of grain-based bio-fuels like corn-ethanol. The examination of the issue reveals that the US bio-fuels targets can have more serious implications for food security in the future that what meets the eye.
    Keywords: bio-fuels, grain-use dynamics, food security, US bio-fuel targets
    JEL: Q18 Q16
    Date: 2010
  10. By: Murali Kallummal; K. Sakthi Srinivasan
    Abstract: Agriculture, which is considered the backbone of the Indian economy, has taken a back seat due to the apathy of government policies in the last two decades. The percentage of cultivable land has come down. Meanwhile, nearly 70 percent of the population depending upon agriculture for their daily livelihood directly or indirectly, is currently undergoing a transformation. With dwindling surpluses from agricultural activities, most of the labourers have now shifted to service sector activities like real estate, working as construction workers, and others (especially the second generation from farming families) who are semiskilled have found solace in the periphery, working for courier companies and the like.
    Keywords: economics, agriculture, construction, farming
    Date: 2010
  11. By: Saurabh Arora; Marjolein C.J. Caniëls; Henny Romijn
    Abstract: Jatropha is emerging as an important biofuel crop throughout developing countries in the tropics. Initially lauded as an environmentally-benign ‘wonder crop’ suitable for arid wasteland cultivation that would avoid competition with scarce livelihood resources, it has recently begun to attract mounting criticisms related to competition with food production, biodiversity impacts, insecurity of land access by local populations, exploitative employment conditions, and disappointing effects on greenhouse gas emission reduction. In this paper we analyse the nature of the local developments that have given rise to these criticisms, and the underlying innovation processes and global forces that are driving the sector in the direction of these contested outcomes. We focus on Tanzania, an important forerunner in Jatropha biofuels production whose experiences have informed the international biofuel debate more broadly. Two surveys among biofuel actors in Tanzania held in 2005 and 2008/9 are the primary data sources. An extended innovation systems perspective is adopted, which is instrumental in studying patterns of global and local institutional embeddedness from a long-term perspective. These patterns are found to be key drivers behind the emergence and evolution of three distinct organizational models in the sector: local energy production and use for rural communities; decentralised subcontracting for centralised oil processors; and large centralised plantations. Socio-economic interactions in these models seem to be regulated by institutions put in place by colonial and early post-colonial governance of agri-commodity production and exchange. Each is also closely associated with different social (network) relations, organizational choices, economic viability, and environmental sustainability effects.
    Keywords: Sustainable development, Globalization, Institutions, Energy, Biofuels, Jatropha
    JEL: O30 R10
    Date: 2010–10
  12. By: Andrew Zeitlin; Stefano Caria; Richman Dzene; Petr Janský; Emmanuel Opoku; Francis Teal
    Abstract: In this paper we explore whether low rates of sustained technology use can be explained by heterogeneity in returns to adoption. To do so we evaluate impacts of the Cocoa Abrabopa Association,which provideda packageof fertilizerand other inputson credit to cocoa farmers in Ghana.Highestimatedaverageproductiveimpactsfortreatedfarmersarefoundtobeconsistent with negative economic profits for a substantial proportion of the treated population. By constructing an individualspecific measure of returns,we demonstrate that low realized returns amongadopters are associatedwith low retention rates, even after conditioningonoutput levels andsuccessfulrepayment.Theresultsareconsistentwiththehypothesisthathighaveragereturns masksubstantialandpersistentheterogeneity,andthatfarmersexperimentinordertolearnabout theiridiosyncraticreturns.
    JEL: O13 O33 Q12 Q16
    Date: 2010
  13. By: Benjamin Heldt
    Date: 2010–12–07
  14. By: De Miranda, Sílvia Helena Galvao; De Camargo Barros, Geraldo SantâAna
    Keywords: International Relations/Trade, Livestock Production/Industries,
    Date: 2010–06–05
  15. By: Strand, Jon
    Abstract: When a groundwater basin is exploited by a large number of farmers, acting independently, each farmer has little incentive to practice conservation that would primarily benefit other farmers. This can lead to excessive groundwater extraction. When farmers pay less than the full cost of electricity used for groundwater pumping, this problem can be worsened; while the problem can be somewhat relieved by rationing the electricity supply. The research in this paper constructs an analytical framework for describing the characteristics of economically efficient groundwater management plans, identifying how individual water use decisions by farmers collectively depart from efficient resource use, and examining how policies related to both water and electricity can improve on the efficiency of the status quo. It is shown that an optimal scheme for pricing electricity used for pumping groundwater includes two main elements: 1) the full (marginal) economic cost of electricity must be covered; and 2) there must be an extra charge, reflected in the electricity price, corresponding to the externality cost of groundwater pumping. The analysis includes a methodology for calculating the latter externality cost, based on just a few parameters, and a discussion of how electricity pricing could be modified to improve efficiency in both power and water use.
    Keywords: Water and Industry,Water Supply and Systems,Water Conservation,Water Use,Wastewater Treatment
    Date: 2010–12–01
  16. By: Vipin chandran, K.P; Sandhya, P
    Abstract: Malnutrition causes a great deal of human suffering, and it is a violation of a child’s human rights. Even today 46 per cent of all children in the country continue to be underweight and a very high proportion of women suffer from anaemia, India is one of the countries with the highest proportion of malnourished children in the world, along with Bangladesh, Ethiopia, and Nepal. In spite of its remarkable economic growth in the past decade, India’s progress in reducing child malnutrition has been excessively slow. The care of young children cannot be left to the family alone – it is also a social responsibility. United Nations agreed to work toward eight Millennium Development Goals (MDGs)—specific, measurable targets to be met by 2015 that will make definite improvements in the lives of the world’s poor and hungry people. Without appropriate policy interventions, the hope of achieving the Millennium Development Goals (MDGs) is bleak. This is because adequate nutrition is a fundamental requirement for children healthy living and development. The present study carried out with three objectives in view; to examine the current trends and determinants of hunger and malnutrition among children in India, to examine the progress regarding some health and nutrition related MDGs and to suggest the cross-cutting strategic approaches to reducing hunger and malnutrition .The main findings of this study, under-five Children are nutritionally the most vulnerable and series of interrelated factors of hunger and malnutrition from rooted in poverty, including a lack of access to food, health care, safe water, sanitation services, and appropriate child feeding and caring practices. This paper argues for cross-cutting strategies for their nutritional needs, even though there is a close relationship between health, growth, nutrition and development in this age group and these dimensions need to be considered holistically.
    Keywords: Malnutrition; Food intake; Hunger index
    JEL: I0
    Date: 2010–03–20
  17. By: Tisdell, Clement A.
    Abstract: It is argued that while considerable development of animal health economics has occurred in recent decades, it has not yet achieved its potential coverage. It has been mostly applied to livestock, particularly livestock used for commerce, and its application to a range of other animals has been relatively neglected. Extending its coverage also requires widening the type of objectives taken into account in the analysis. Furthermore, the main focus of animal health economics has been on the economics of controlling and managing the occurrence of diseases. The economic role of genetics, the environment, nutrition and the comfort of animals in their health ought to be given greater attention. In the case of zoonoses, the economic analysis should be extended to take into account human health. Those studying animal health economics need to make decisions in their analysis about its spatial dimensions, its time dimensions, and the stakeholders to be considered. They must also take into account health chains and make allowances for risk and uncertainty. The economics of knowledge (including, for example, information economics and research and development) is worthy of more attention in animal health economics. Many important questions arise in animal health economics but two big ones might be: (1) what role should governments play in managing animal health and how should their involvement be financed; and (2) what precautions for maintaining animal health are economic? In conclusion, some reasons are suggested for animal health economics being unable to achieve its potential coverage.
    Keywords: Animal health economics, diseases, health economics, information economics, precautionary principle, public economics, zoonoses, Farm Management, Health Economics and Policy, Livestock Production/Industries, Public Economics, I10, Q19,
    Date: 2010–12
  18. By: Mireille Chiroleu-Assouline (Centre d'Economie de la Sorbonne - Paris School of Economics)
    Abstract: This paper addresses how corporate environmentalism can be a means of differentiation and of green-washing. Since consumers can seldom directly observe a firm's environmental quality (a problem not easily solved through eco-labeling), published environmental reports and advertising can mislead them. As a result, the role of the NGO becomes both crucial and ambiguous. On the one hand, by helping to increase consumer awareness, NGOs enlarge the market share of green differentiated firms. On the other hand, the risk that consumers will punish a firm perceived to be supplying inaccurate environmental information may bring about the paradoxical result of discouraging differentiation efforts.
    Keywords: Differentiation, environmental concern, imperfect competition, quality, advertising, NGO.
    JEL: L12 L15 L31 M37 Q50
    Date: 2010–12

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