nep-agr New Economics Papers
on Agricultural Economics
Issue of 2011‒03‒12
twenty-six papers chosen by
Angelo Zago
University of Verona

  1. CAP Reform and Its Impact on Structural Change and Productivity Growth: A Cross Country Analysis By Andrius Kazukauskas; Carol Newman; Johannes Sauer
  2. Horizontal price transmission of the Finnish meat sector with major EU players By Liu, Xing
  3. Introducing First and Second Generation Biofuels into GTAP Data Base version 7* By Taheripour, Farzad; Wally Tyner
  4. The Political Economy of Policy Instrument Choice: Theory and Evidence from Agricultural Policies By Johan F.M.Swinnen; Alessandro Olper; Thijs Vandemoortele
  5. Industrialisation and de-industrialisation: England divides By Jones, Eric
  6. Real Estate and Land Values on the shoreline: a transaction-level analysis (In French) By Jeanne DACHARY-BERNARD (UR ADBX, CEMAGREF); Sandrine LYSER (UR ADBX, CEMAGREF); Frédéric GASCHET (GREThA, CNRS, UMR 5113); Guillaume POUYANNE (GREThA, CNRS, UMR 5113); Stéphane VIROL (GREThA, CNRS, UMR 5113)
  7. Economic Contribution of the Soybean Industry to the North Dakota Economy By Bangsund, Dean A.; Olson, Frayne; Leistritz, F. Larry
  8. Globalisation and sustainable exports of Indian medicinal and aromatic plants: A protection study By Bera, Soumitra
  9. Econometric Estimation of Distance Functions and Associated Measures of Productivity and Efficiency Change By C.J. O’Donnell
  10. Crop Choice, Non-Target Pest Levels, Yield Loss and Their Effect on Insecticide Use in South Dakota By McDonald, Tia Michelle; Keating, Ariel Ruth; Scott Fausti; Li, Jing; Lundgren, Jonathan G
  11. Engel Curves, Spatial Variation in Prices and Demand for Commodities in Côte d'Ivoire By Gbakou, Monnet Benoit Patrick; Sousa-Poza, Alfonso
  12. Tax-benefit incidence of value added tax on food and medicine to fund progressive social expenditure By Jaime Acosta-Margain
  13. Net Campaign Contributions, Agricultural Interests, and Votes on Liberalizing Trade with China By John Gilbert; Reza Oladi
  14. The Impact of Biofuels Policy on Agribusiness Stock Prices By Tepe, Fatma; Du, Xiaodong; Hennessy, David A.
  15. Insure or Invest in Green Technologies to Protect Against Adverse Weather Events? By Pietola, Kyösti; Myyrä, Sami; Niemi, Jarkko K.; van Asseldonk, Marcel
  16. ”How much is enough?” Determining Adequate Levels of Environmental Compensation for Wind Power Impacts using Equivalency Analysis: An Illustrative & Hypothetical Case Study of Sea Eagle Impacts at the Smøla Wind Farm, Norway By Cole, Scott
  17. From Gutsherrschaft to Grundherrschaft: Demographic, Monetary, and Fiscal Factors in the Late-Medieval Decline of English Manorial Desmesne Agriculture By John H. Munro
  18. Good deals in markets with frictions By Alejandro Balbás; Beatriz Balbás; Raquel Balbás
  19. Concepts for Safety Stock Determination under Stochastic Demand and Different Types of Random Production Yield By Karl Inderfurth; Stephanie Vogelgesang
  20. The relationship between in-store marketing and observed sales of sustainable products: A shopper marketing view By Nierop, Erjen van; Herpen, Erica van; Sloot, Laurens
  21. Incorporating perceptions and experiences of violence into livelihood decision-making: a micro level study in the Chittagong Hill Tracts of Bangladesh By Badiuzzaman, M.
  22. Globalization and development in sub-Saharan Africa By Jomo Kwame Sundaram; Oliver Schwank; Rudiger von Arnim
  23. Endogenous Timing in Pollution Control: Stackelberg versus Cournot-Nash Equilibria By Melanie Heugues
  24. Reducing Fuel Volatility - An Additional Benefit From Blending Bio-fuels? By Rob Bailis; Barbara Sophia Koebl; Mark Sanders
  25. On modeling pollution-generating technologies By Sushama Murty; R. Robert Russell; Steven B. Levkoff
  26. Spatial Risk Premium on Weather Derivatives and Hedging Weather Exposure in Electricity By Wolfgang Karl Härdle; Maria Osipenko

  1. By: Andrius Kazukauskas (Department of Economics, Trinity College Dublin); Carol Newman (Department of Economics, Trinity College Dublin); Johannes Sauer (School of Social Sciences, University of Manchester)
    Abstract: The decoupling of direct payments from production, introduced in the recent reform of the Common Agricultural Policy (CAP) is expected to make production decisions more market-oriented and farmers more productive. However, ex-post analyses of the productivity of farms have yet to uncover any evidence of a positive impact of the decoupling policy on farm productivity. Using Irish, Danish and Dutch farm level data, we identify whether the decoupling policy has contributed to productivity growth in agriculture and to what extent enterprise switching and specialisation are important productivity improving mechanisms. We find some evidence that the decoupling policy and related farm enterprise specialisation had significant positive effects on farm productivity.
    Keywords: productivity, subsidy decoupling, semi-parametric estimation, switching, specialisation
    JEL: D24 Q12 Q18
    Date: 2011–02
    URL: http://d.repec.org/n?u=RePEc:tcd:tcduee:tep0411&r=agr
  2. By: Liu, Xing
    Abstract: The integration of the Finnish meat market in the EU has important implications for domestic agricultural policy. Our aim is to estimate the characteristics of the Finnish pork and beef markets in relation to those of Germany and Denmark. Our analysis uses symmetric and asymmetric threshold error correction models. Both pork and beef prices in Finland are found to have slowly cointegrated with German prices, but the cointegration relationship of the two counties is only found to be symmetric for pork prices, while it is asymmetric for beef prices. The producer price for pork in Finland is symmetrically cointegrated with the Danish price, but the Finnish and Danish beef prices show a random walk. This implies that the price transmission to the Finnish pork producer market from the EU market is smoother and more efficient than for the beef market. However, the speed of transmission is still slow compared to that between the Danish and German markets.
    Keywords: cointegration, asymmetric, error correction, thresholds, pork and beef prices, Agribusiness, Demand and Price Analysis, Food Consumption/Nutrition/Food Safety, International Relations/Trade,
    Date: 2011–02
    URL: http://d.repec.org/n?u=RePEc:ags:mttfdp:100215&r=agr
  3. By: Taheripour, Farzad; Wally Tyner
    Abstract: The first version of GTAP-BIO Data Base was built based on the GTAP standard data base version 6 which represents the world economy in 2001 (Taheripour et al., 2007). That data base covers global production, consumption, and trade of the first generation of biofuels including ethanol from grains (eth1), ethanol from sugarcane (eth2), and biodiesel (biod) from oilseeds in 2001. Version 7 of GTAP Data Base, which depicts the world economy in 2004, is now published (Narayanan, B.G. and T.L. Walmsley, 2008). However, this standard data base does not include biofuel industries explicitly. The first objective of this research memorandum is to introduce the first generation of biofuels into this new data base. To accomplish this task we will follow Taheripour et al. (2007). The rapid expansion of the first generation of biofuels in the past decades has raised important concerns related to food-fuel competition, land use change, and other economic and environmental issues. These issues have increased interest in the second generation of biofuels which can be produced from cellulosic materials such as dedicated crops, agricultural and forest residues, and waste materials. To examine the economic and environmental consequences of the second generation of biofuels, a CGE model is an appropriate and essential instrument. A data base which presents the first and second generation of biofuels will facilitate research in this field. Hence the second objective of this research memorandum is to expand the space of biofuel alternatives to the second generation. Given that advanced cellulosic biofuels are not yet commercially viable, we used the most up to date information in this area to define the production technologies for these industries.
    Date: 2011
    URL: http://d.repec.org/n?u=RePEc:gta:resmem:3477&r=agr
  4. By: Johan F.M.Swinnen; Alessandro Olper; Thijs Vandemoortele
    Abstract: We study the political economy of instrument choice in agricultural and food policies. After a review of the historical evolution of European agricultural price and trade policy instruments since 1880, we develop a political economy model of instrument choice. The key predictions of the model suggest a rational explanation of instrument choice patterns, based on the trade-off between the different cost components of the policies, and internal and external political constraints. An empirical analysis supports the main predictions of the theoretical model. We find that the GATT/WTO agreement had a significant impact.
    Keywords: Political Economy; Instrument Choice; Agricultural Policy, GATT, WTO
    JEL: D78 Q18
    Date: 2011
    URL: http://d.repec.org/n?u=RePEc:lic:licosd:27911&r=agr
  5. By: Jones, Eric
    Abstract: National averages conceal powerful interactions underlying English economic development in the seventeenth and eighteenth centuries. The simplest operational divisions are north, south and London. Initially industry and business culture predominated in the south but this culture was seduced by the gentry lifestyle and entrepreneurship redirected towards producing food and transporting it to London. The twin attractions of landed society and the London food market caused manufacturing to atrophy: the south deindustrialised. In the north a business culture expanded, capital having come into the hands of small farmers in Lancashire and Cheshire during the sixteenth-century rise in food prices. Entrepreneurship and skills were also fostered by religious independence, accompanied by only limited conspicuous consumption. Four main industries developed: metal working (especially clock- and watchmaking), cheese making, salt production and cotton manufacturing. But the mechanisation of cotton lagged because it was unacceptable to throw large numbers of hand spinners out of work. The technical challenge was minor compared with clock- and watchmaking, from which skills were borrowed by cotton manufacturers once demand began to expand fast.
    Keywords: industrialisation; de-industrialisation; regional change; business culture; agriculture; landed estates; clock- and watchmaking; cotton mechanisation.
    JEL: N13
    Date: 2011–01–21
    URL: http://d.repec.org/n?u=RePEc:pra:mprapa:29247&r=agr
  6. By: Jeanne DACHARY-BERNARD (UR ADBX, CEMAGREF); Sandrine LYSER (UR ADBX, CEMAGREF); Frédéric GASCHET (GREThA, CNRS, UMR 5113); Guillaume POUYANNE (GREThA, CNRS, UMR 5113); Stéphane VIROL (GREThA, CNRS, UMR 5113)
    Abstract: Land use changes generate some conflicts, in particular between agricultural and residential uses in the urbanization context and sprawl phenomena. Coastal zones also produce specific amenities that create conflicts over land-use, increase housing and land values and, associated with and/or substituted to urban amenities modify the structure of the territory.\r\nThis article is aimed at studying the influence of coastal and urban amenities, respectively defined in terms of accessibility to the sea side and to employment center, on prices. We differentiate the analysis between two distinct study areas according to the degree of urban development: the Charente coast that is still highly agricultural, and the Basque coastal area more urbanized. According to these local specificities, we will study with the same hedonic pricing method land use prices in the first case and property prices in the second.\r\nThe main results underline the major influence of littoralisation as structural phenomena in housing and land prices dynamics. We identify two different types of gradient of values in relation to distance to sea side as regards to the residential or agricultural use: a “growth premium” explains the agricultural land price gradient whereas both amenity and accessibility premiums justify the residential gradients.
    Keywords: coastal areas, land and housing markets, hedonic pricing, gradients
    JEL: R31 Q15 C31
    Date: 2011
    URL: http://d.repec.org/n?u=RePEc:grt:wpegrt:2011-07&r=agr
  7. By: Bangsund, Dean A.; Olson, Frayne; Leistritz, F. Larry
    Abstract: The purpose of this study was to measure the economic contribution of the soybean industry to the North Dakota economy. Expenditures and returns from soybean production, grain handling, and transportation were estimated to calculate the direct economic impacts from soybean activities. Secondary economic impacts were estimated using the North Dakota Input- Output Model. Soybean production in North Dakota has trended upward over the past three decades. Increases in acreage were relatively modest in the 1980s, but by the mid 1990s acreage was beginning to rapidly expand. In 1990, North Dakota had about 500,000 acres of soybeans. By 2000, acreage had increased to 1.9 million acres. By 2009, soybean acreage in the state was approaching 4 million acres. Direct impacts (expenditures and returns) from soybean production averaged $312 per acre or $1.1 billion annually from 2007 through 2009. Average direct impacts from handling soybeans at North Dakota elevators were estimated at $27.5 million annually. Transportation of soybeans to market destinations was estimated to generate $49.8 million in annual direct impacts to the state. Total direct impacts from soybean production, grain handling, and transportation were estimated at $1.2 billion annually. Total annual economic impacts (direct and secondary effects) from soybean production, grain handling, and transportation were estimated at $3 billion, $75.9 million, and $129 million, respectively. The total annual economic impact from all soybean activities was estimated at $3.2 billion. Soybean industry activities supported 11,400 full-time secondary jobs in North Dakota. Soybean activities were also responsible for $85 million in combined property tax, sales tax, individual income tax, and corporate income tax revenues. Based on comparison to economic impact estimates from the 1996 through 1998 period, the economic contribution of the soybean industry in North Dakota increased by $2.4 billion or by 306 percent in real terms. Much of the increase in the gross business volume of the industry has come from a three-fold increase in soybean production combined with higher crop prices, handling margins, and transportation rates.
    Keywords: soybeans, North Dakota, economic impact, Crop Production/Industries, Production Economics,
    Date: 2011–01
    URL: http://d.repec.org/n?u=RePEc:ags:nddaae:100396&r=agr
  8. By: Bera, Soumitra
    Abstract: India has a rich heritage of traditional systems of medicine viz. Ayurveda, Unani, Siddha, Tibetan which are mostly based on botanical formulations. Although biologically, the region is extremely rich in medicinal plants, due to years of unwise use, the availability of raw materials in desired quality and quantity has become difficult to obtain raising serious doubt about the safety and efficacy of the medicines currently in use. There is unprecedented demand for natural medicines, green health products, pharmaceuticals, food supplements, cosmetics, and herbal pesticides to bring about this alarming loss of plant biodiversity. The sustainable production, conservation and use of medicinal plants are influenced by a number of factors, largely of socio-economic, technical, institutional and policy nature. Unsustainable harvesting of the raw materials from the wild by untrained and poor collectors mostly using primitive methods and lack of awareness about the real value of the resources are other two important factors leading to resource depletion. Rural people derive a substantial portion of their income and products for their basic health care needs from medicinal plants gathered from the nature. Medicinal plants-based drug industries and enterprises which run into thousands presently source more than 85% of their raw materials from the wild as they are cheap and believed to be of higher potency. There is a great need to reduce pressure on the in-situ sources by diversifying the production sites of these important plants. Domestication is one of the alternatives being attempted but given the large population of developing countries living below poverty line and growing need for economic and environmental security, it is unlikely that the current lands devoted to pure or mixed agriculture or forestry can be diverted to grow medicinal plants in a significant amount. Besides, domestication has to be carried out in similar habitats since some of the cultivated plants are known to give different chemical constituents than their natural counterparts due to environmental factors. As a large number of private sectors investment is possible in this sector, medicinal plants can be developed as a potential bridge between sustainable economic developments, safe & affordable health care and conservation of vital biodiversity. The paper suggests that a long-term and sustainable bio-partnerships between industry and rural communities should be formed which is in the interest of both the producers/collectors and drug industries as both stand to gain. The former will have regular, reliable and quality supply sources of raw materials and later will have assured market, increased income and fair price for their products. Necessary support and facilitation by the GOs, NGOs and academia in terms of technology transfer, Policy and legal support and extension may build and strengthen the partnership evolution process. There is an immediate need to initiate pilot case studies and model buy back arrangements between collectors/growers and industry representatives to start this process. This paper analyses the social, economic and institutional implications of such relationships based on various examples of evolving partnership concepts focusing on their efficiency, equity, and feasibility.
    Keywords: Medicinal Plants and Livelihood Security; Holistic Rocource Management Approach; Partnership Ventures; Sustainable Commercialisation
    JEL: P33 F18 D31 F12 F14
    Date: 2010–09–19
    URL: http://d.repec.org/n?u=RePEc:pra:mprapa:28908&r=agr
  9. By: C.J. O’Donnell (CEPA - School of Economics, The University of Queensland)
    Abstract: The economically-relevant characteristics of multi-input multi-output production technologies can be represented using distance functions. The econometric approach to estimating these functions typically involves factoring out one of the outputs or inputs and estimating the resulting equation using maximum likelihood methods. A problem with this approach is that the outputs or inputs that are not factored out may be correlated with the composite error term. Fernandez, Koop and Steel (2000, p. 58) have developed a Bayesian solution to this so-called ‘endogeneity’ problem. O'Donnell (2007) has adapted the approach to the estimation of directional distance functions. This paper shows how the approach can be used to estimate Shephard (1953) distance functions and an associated index of total factor productivity (TFP) change. The TFP index is a new multiplicatively-complete index that satisfies most, if not all, economically-relevant tests and axioms from index number theory. The fact that it is multiplicatively-complete means it can be exhaustively decomposed into a measure of technical change and various measures of efficiency change. The decomposition can be implemented without the use of price data and without making any assumptions concerning either the optimising behaviour of firms or the degree of competition in product markets. The methodology is illustrated using state-level quantity data on U.S. agricultural inputs and outputs over the period 1960-2004. Results are summarised in terms of the characteristics (e.g., means) of estimated probability densities for measures of TFP change, technical change and output-oriented measures of efficiency change.
    Date: 2011–03
    URL: http://d.repec.org/n?u=RePEc:qld:uqcepa:61&r=agr
  10. By: McDonald, Tia Michelle (Department of Economics, South Dakota State University); Keating, Ariel Ruth (Department of Economics, South Dakota State University); Scott Fausti (Department of Economics, South Dakota State University); Li, Jing; Lundgren, Jonathan G (Department of Economics, South Dakota State University)
    Abstract: Agriculturally, South Dakota is a unique state possessing the highest rate of adoption for genetically modified crop varieties. In 2009 ninety-six percent of corn acres planted in South Dakota were genetically modified compared with eighty-five percent nationally (Economic Research Service). Additionally, South Dakota has seen a dramatic increase in the number of acres treated with insecticide over the past 20 years. These two situations taken together seem to be counterintuitive. Some genetically modified varieties, such as Bt corn, are equipped with genetic defenses so that they can protect the plant from target pests. Intuitively, one would expect to see a decrease in insecticide use as adoption of genetically modified varieties increase. Recent studies have found that there is a reduction in herbicides applied to herbicide tolerant varieties. Here in South Dakota, though, producers have expressed the opinion that the increase in insecticide use is the result of the emergence and spread of the soybean aphid in the state. This research seeks to address the underlying causes of the increase in insecticide use.
    Keywords: Bt corn,GM crops,insecticide
    JEL: Q1 Q2 Q5
    Date: 2010–07
    URL: http://d.repec.org/n?u=RePEc:sda:rerepo:201002&r=agr
  11. By: Gbakou, Monnet Benoit Patrick (University of Hohenheim); Sousa-Poza, Alfonso (University of Hohenheim)
    Abstract: This paper aims to estimate the price and income elasticities of the demand for essential commodities in Cote d'Ivoire. Using data from the 2002 Cote d'Ivoire Living Standard Survey and a theoretical framework developed by Crawford et al. (2003), we analyse price effects on the demand for groups of commodities by exploiting a relationship between unit values and commodity quantities and deriving Engel curves. Our findings reveal that the own-price elasticity of meat and dairy products is considerably stronger for rich households (those in the 90th percentile of total expenditure) than for poor households (those in the 10th percentile of total expenditure). Although all the modelled groups of commodities are normal goods, the paper shows that starch is more of a necessity for poor households than for rich ones, whereas meat and dairy products are more of a luxury good for poor households than for rich households.
    Keywords: consumer demand, unit values, developing country
    JEL: D11 D12
    Date: 2011–03
    URL: http://d.repec.org/n?u=RePEc:iza:izadps:dp5551&r=agr
  12. By: Jaime Acosta-Margain (Rice University)
    Abstract: In 2009, the Mexican Congress received a proposal of a generalized 2% increase in the statutory VAT rate, including currently untaxed food and medicine. Whereas opponents emphasized the regressive effect, supporters argued that progressivity of the compensatory expenditures included in the bill more than compensated the bottom income quintiles. In this paper I present a tax-benefit incidence of this proposal using national survey data on household's income and consumption. Despite the regressive effect of the tax increase, the data shows that the progressive expenditure offsets this effect. Overall the proposal was progressive. This finding undermines the arguments in favor of keeping food and medicines exempt of VAT to prevent a regressive effects. This result also contributes to the debate about the regressive effects of a single VAT to all consumption and no exemptions. To illustrate that, I analyze the redistributive effect of this policy. The result is that the increase in public expenditure can offset the regressive effect of this policy.
    Keywords: Value added tax, tax-benefit incidence.
    JEL: H20 H22 H27
    Date: 2011
    URL: http://d.repec.org/n?u=RePEc:inq:inqwps:ecineq2011-194&r=agr
  13. By: John Gilbert (Department of Economics and Finance, Utah State University); Reza Oladi
    Abstract: We consider the potential influence of contributions from interest groups to political rivals in the voting behavior of US legislators on international trade policy issues. Our application addresses the determinants of the Permanent Normal Trade Relations with China decision, and focuses particular attention on the agriculture/agribusiness lobby. A simultaneous voting-net contributions model suggests that these contributions were very effective relative to organized labor and other corporate groups, despite their relatively small dollar value. Possible explanations arising from differences in targeting strategies are explored.
    Keywords: Trade policy, agricultural political economy, binary choice models, China
    JEL: D72
    Date: 2011–01–20
    URL: http://d.repec.org/n?u=RePEc:usu:wpaper:2011-02&r=agr
  14. By: Tepe, Fatma; Du, Xiaodong; Hennessy, David A.
    Date: 2011–03–03
    URL: http://d.repec.org/n?u=RePEc:isu:genres:32530&r=agr
  15. By: Pietola, Kyösti; Myyrä, Sami; Niemi, Jarkko K.; van Asseldonk, Marcel
    Abstract: This paper analyses investments in green technologies when insurance is also an option. Green technologies are defined to have the power to increase productivity and decrease volatility of future revenues. The insurance options involve the scale and coverage either in a yield insurance or in an index insurance. The stochastic process is a combination of insurable stationary short-run process and non-stationary long run process. The optimal decision rules are solved numerically by stochastic dynamic programming. The results suggest that the index insurance maintains market based incentives to invest in green technologies whereas a yield insurance substantially decreases investments, as expected. An actuarially fair yield insurance decreases investments at high productivity firms. By contrast if the insurance premiums are supported to the extent that the net loading becomes negative, firms with the lowest productivity have strong incentives to collect the benefits of the subsidized insurance rather than invest in higher productivity and lower risks. The yield insurance is the most attractive for low productivity firms while the index insurance is the most attractive for high productivity firms. Nevertheless, the demand for actuarially fair index insurance is reduced also amongst the high productivity firms, when the correlation between the yield and the index falls below 50%.
    Keywords: investment, insurance, uncertainty, dynamic programming, green technology, Agribusiness, Agricultural Finance, Financial Economics, Risk and Uncertainty,
    Date: 2011–02
    URL: http://d.repec.org/n?u=RePEc:ags:mttfdp:100738&r=agr
  16. By: Cole, Scott (CERE, Centre for Environmental and Resource Economics)
    Abstract: Environmental considerations at wind power require avoidance and mitigation of environmental impacts through proper citing, operational constraints, etc. However, some impacts are unavoidable for otherwise socially-beneficial projects. Criteria for Environmental Impact Assessment (EIA) suggest that compensation be provided for unavoidable or residual impacts on species and/or habitat from wind power development. Current environmental compensation schemes for wind power fail to demonstrate a connection between the expected ecological damage and the ecological gains through restoration. The EU-funded REMEDE project developed quantitative methods known as "equivalency analysis" to assist in scaling environmental compensation. This study provides a framework for estimating compensation at wind facilities based on the REMEDE approach. I illustrate the approach with a hypothetical case study involving sea eagle impacts at the Smøla Wind Farm (Norway). I quantify the damage (debit) from sea eagle turbine collisions and scale a compensatory project (credit) that reduces eagle mortality from power line electrocution, which is quantified using hypothetical data. The framework is generalizable to on- and off-shore wind development but requires targeted and thoughtful data collection. Importantly, compensation should not be used disingenuously to justify otherwise environmentally costly projects.
    Keywords: Equivalency Analysis; environmental compensation; wind power
    JEL: K32 Q42 Q51 Q57
    Date: 2011–03–03
    URL: http://d.repec.org/n?u=RePEc:hhs:slucer:2011_004&r=agr
  17. By: John H. Munro
    Abstract: This study on the late-medieval decline of English manorial demesne agriculture is based on the Germanic paradigm of Gutsherrschaft and Grundherrschaft, which historians have utilized to explain the transformation of feudal agriculture, east of the Elbe River, from the 15th to the 18th centuries. The former is a manorial regime in which the lord derived his incomes primarily from the commercial exploitation of his demesne lands, using the compulsory labour services of servile tenants. The latter is a manorial regime in which the lord derived his incomes instead primarily from cash rents paid by largely free peasants. In East Elbia, the early-modern shift was from Grundherrschaft to Gutsherrschaft. Late medieval manorial England experienced a reverse shift: from Gutsherrschaft to Grundherrschaft. To explain this transformation, this paper employs a supplementary monetary and fiscal model to prove that the standard Ricardian demographic model is insufficient to explain these changes. My monetary model, based on my prior publications on the deflationary consequences of the first late-medieval bullion famine, from ca. 1375 to ca. 1420, demonstrates that all agrarian prices fell (in nominal terms), while the Ricardian model stipulates that the price fall was limited to grains, and further that the consequent rise in living standards would have led to rising livestock product and other agrarian prices. It also demonstrates that the rise in real wages (agrarian) was partly the result of deflation combined with institutional wage stickiness. My fiscal model demonstrates that the imposition of heavy fixed (specific and not ad valorem) taxes on exports of English wools, by so seriously injuring the chief consumers, the woollen draperies in the Low Countries, quickly led to sharply falling wool sales and (real) wool prices. With such a damaging price-cost scissors, English landlords found that the continued commercial exploitation of their demesnes based on grains and wool was no longer profitable, while leasing those lands to free peasants (abolishing most vestiges of serfdom) was very profitable, since the leasehold tenants had to pay rents whose real value rose during the era of this deflation (ca 1375 - ca. 1420).
    Keywords: money; coinage; bullion famines; deflation; manorialism; demesne agriculture; leasing demesnes; serfdom; servile labour services; peasant tenancies; copyholds; leaseholds; Gutsherrschaft; Grundherrschaft; commodity prices; factor prices; labour; wages; ‘wage-stickiness’; interest; grains; wools; livestock products; wool-export trade; wool-export duties; Flanders; woollen draperies
    JEL: D24 E31 E42 E51 E62 F14 F16 H22 J11 J31 J43 N13 N33 N43
    Date: 2011–02–28
    URL: http://d.repec.org/n?u=RePEc:tor:tecipa:tecipa-424&r=agr
  18. By: Alejandro Balbás; Beatriz Balbás; Raquel Balbás
    Abstract: This paper studies a portfolio choice problem such that the pricing rule may incorporate transaction costs and the risk measure is coherent and expectation bounded. We will prove the necessity of dealing with pricing rules such that there are essentially bounded stochastic discount factors, which must be also bounded from below by a strictly positive value. Otherwise good deals will be available to traders, i.e., depending on the selected risk measure, investors can build portfolios whose (risk, return) will be as close as desired to (- infinite, + infinite) or (0, infinite). This pathologic property still holds for vector risk measures (i.e., if we minimize a vector valued function whose components are risk measures). It is worthwhile to point out that essentially bounded stochastic discount factors are not usual in financial literature. In particular, the most famous frictionless, complete and arbitrage free pricing models imply the existence of good deals for every coherent and expectation bounded measure of risk, and the incorporation of transaction costs will no guarantee the solution of this caveat
    Keywords: Risk measure, Perfect and imperfect markets, Stochastic discount factor, Portfolio choice model, Good deal
    JEL: G12 G13 G11
    Date: 2011–02
    URL: http://d.repec.org/n?u=RePEc:cte:wbrepe:wb110302&r=agr
  19. By: Karl Inderfurth (Faculty of Economics and Management, Otto-von-Guericke University Magdeburg); Stephanie Vogelgesang (Faculty of Economics and Management, Otto-von-Guericke University Magdeburg)
    Abstract: We consider a manufacturer's stochastic production/inventory problem under periodic review and present concepts for safety stock determination to cope with uncertainties that are caused by stochastic demand and different types of yield randomness. Order releases follow a linear control rule. Taking manufacturing lead times into account it turns out that safety stocks have to be considered that vary from period to period. We present an approach for calculating these dynamic safety stocks. Additionally, to support practical manageability we suggest two approaches for determining appropriate static safety stocks that are easier to apply.
    Keywords: stochastic demand, random yield, lot sizing, safety stocks
    Date: 2011–02
    URL: http://d.repec.org/n?u=RePEc:mag:wpaper:110003&r=agr
  20. By: Nierop, Erjen van; Herpen, Erica van; Sloot, Laurens (Groningen University)
    Abstract: To stimulate sales of sustainable products, retailers need to know whether their in-store instruments effectively influence their market shares. This study uses actual sales data and a multilevel modeling approach to describe the market shares of sustainable brands according to price level, price promotions, and shelf layout factors, while controlling for the customer base and competitive environment. As expected, a price premium compared with the leading brand in a category decreases market share for sustainable brands, but the location on the shelf and the arrangement of the entire product category also influence market shares considerably. In particular, where literature has described conflicting findings for horizontal location on the shelf, in our study sustainable brands receive more market share when placed in the middle of the shelf space devoted to the category, and eye level is the best vertical position. Higher market share is observed when the entire category is arranged by brand. This study therefore suggests that where sustainable brands are located on the shelf may be just as important, if not more than, how many facings they have.
    Date: 2011
    URL: http://d.repec.org/n?u=RePEc:dgr:rugsom:11001&r=agr
  21. By: Badiuzzaman, M.
    Abstract: This paper analyses the influence of perceived violence on livelihood decisionmaking of indigenous households in post conflict Chittagong Hill Tracts of Bangladesh following a formal peace treaty in 1997. The study results suggest that households perceiving high risk of violence spend less on consumption expenditure and are sending children to school more, cultivating more land and engaged more in producing mixed subsistence and cash crops. Using both quantitative and qualitative data this study finds decreasing emphasis on present consumption, long term investment in human capital, using land more intensively to earn more cash and move towards creating surplus instead of producing for subsistence, which suggests perceived violence is producing decisions which are similar to those advocated in a classical ‘modernization process’. Findings of this paper are similar to the argument of ‘post traumatic growth theory’ and indicates a post-conflict ‘phoenix’ factor may be in operation at the household level in which some income raising livelihood decisions are made as a consequence of fear of renewed violence. In the short run, the ‘phoenix’ factor appears to operate through both increased land use and cash crop cultivation and in the long run through increased human capital.
    Keywords: Post-conflict;perception of violence;livelihood decisions;land use;schooling
    Date: 2011–02–28
    URL: http://d.repec.org/n?u=RePEc:dgr:euriss:516&r=agr
  22. By: Jomo Kwame Sundaram; Oliver Schwank; Rudiger von Arnim
    Abstract: This paper critically reviews the impact of globalization on sub-Saharan Africa (SSA) since the early 1980s. The large gains expected from opening up to international economic forces have, to date, been limited, and there have been significant adverse consequences. Foreign direct investment in SSA has been largely confined to resource—especially mineral—extraction, even as continuing capital flight has reduced financial resources available for productive investments. Premature trade liberalization has further undermined prospects for the economic development of SSA as productive capacities in many sectors are not sufficiently competitive to take advantage of any improvements in market access.
    Keywords: Africa, Agriculture, Aid, Bretton Woods institutions, Development, FDI, Finance, Industry, Structural Adjustment, Trade
    JEL: O1 O2 O55
    Date: 2011–02
    URL: http://d.repec.org/n?u=RePEc:une:wpaper:102&r=agr
  23. By: Melanie Heugues
    Abstract: In the framework of international cooperation on climate change to control greenhouse gas emissions<br /> (GHG), this paper aims to shed new light on the eventuality of the emergence of a country (or a group<br /> of countries) behaving as a leader in the implementation of its environmental policy. The sequence of<br /> moves in the existing literature is usually an exogenous assumption, – known as the Cournot<br /> assumption (if countries take action simultaneously) and the Stackelberg assumption (if they act<br /> sequentially, the latter observing the strategy of the former). The main purpose here is to make the<br /> timing endogenous. To do so, we introduce a pre-play stage in the basic two-country game. Then we<br /> provide different sets of minimal conditions – on the benefit and damage functions linked to GHG<br /> emissions into the atmosphere, yielding respectively the simultaneous and the two sequential modes of<br /> play. While the results essentially confirm the prevalence of the former, they also indicate that the<br /> latter are natural under some robust conditions: a leader can emerge endogenously when<br /> implementing its environmental policy. Finally we provide sufficient conditions for a specific leader<br /> to appear. All the results come with an analysis in terms of global emissions and global welfare. No<br /> extraneous assumptions such as concavity, existence, or uniqueness of equilibria are needed, and the<br /> analysis makes crucial use of the basic results from the theory of supermodular games.<br />
    Keywords: Climate change; non cooperative game; global pollution; strategic interactions; endogenous timing; supermodular game theory
    Date: 2011–03
    URL: http://d.repec.org/n?u=RePEc:bcc:wpaper:2011-03&r=agr
  24. By: Rob Bailis; Barbara Sophia Koebl; Mark Sanders
    Abstract: Oil price volatility harms economic growth. Diversifying into different fuel types can mitigate this effect by reducing volatility in fuel prices. Producing bio-fuels may thus have additional benefits in terms of avoided damage to macro-economic growth. In this study we investigate trends and patterns in the determinants of a volatility gain in order to provide an estimate of the tendency and the size of the volatility gain in the future. The accumulated avoided loss from blending gasoline with 20 percent ethanol-fuel estimated for the US economy amounts to 795 bn. USD between 2010 and 2019 with growing tendency. An amount that should be considered in cost-benefit analysis of bio-fuels.
    Date: 2011–02
    URL: http://d.repec.org/n?u=RePEc:use:tkiwps:1101&r=agr
  25. By: Sushama Murty (Department of Economics, University of Exeter); R. Robert Russell (Department of Economics, University of California); Steven B. Levkoff (Department of Economics, University of California)
    Abstract: Distinguishing between intended ("good") production and unintended or residual ("bad") generation, we introduce the concept of by-production. In by-production technologies, pollution is an output that satises a "costly disposability" assumption and violates standard free disposability with respect to pollution-causing inputs. Our approach therefore differs substantially from standard approaches to modeling pollution-generating technologies. We show how by-production can be modeled using data envelopment analysis (DEA) methods. With an electric power plant database, we illustrate shortcomings under by-production of two popular eciency indexes: the hyperbolic index and the directional distance function. We propose and implement an alternative eciency index with superior properties.
    Keywords: pollution-generating technologies, free disposability, weak disposability, data envelopment analysis, environmental and technical eciency measurement
    JEL: D20 D24 D62 Q50
    Date: 2011
    URL: http://d.repec.org/n?u=RePEc:exe:wpaper:1101&r=agr
  26. By: Wolfgang Karl Härdle; Maria Osipenko
    Abstract: Due to dependency of energy demand on temperature, weather derivatives enable the effective hedging of temperature related fluctuations. However, temperature varies in space and time and therefore the contingent weather derivatives also vary. The spatial derivative price distribution involves a risk premium. We examine functional principal components of temperature variation for this spatial risk premium. We employ a pricing model for temperature derivatives based on dynamics modelled via a vectorial Ornstein-Uhlenbeck process with seasonal variation. We use an analytical expression for the risk premia depending on variation curves of temperature in the measurement period. The dependence is exploited by a functional principal component analysis of the curves. We compute risk premia on cumulative average temperature futures for locations traded on CME and fit to it a geographically weighted regression on functional principal component scores. It allows us to predict risk premia for nontraded locations and to adopt, on this basis, a hedging strategy, which we illustrate in the example of Leipzig.
    Keywords: risk premium, weather derivatives, Ornstein-Uhlenbeck process, functional principal components, geographically weighted regression
    JEL: C01 C31
    Date: 2011–03
    URL: http://d.repec.org/n?u=RePEc:hum:wpaper:sfb649dp2011-013&r=agr

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