nep-agr New Economics Papers
on Agricultural Economics
Issue of 2011‒10‒09
nineteen papers chosen by
Angelo Zago
University of Verona

  1. Indian agriculture and food security: problem and prospects By Dr shaukat, haseen; Md rehan, khan
  2. 2011 North Dakota Agricultural Outlook: Representative Farms, 2011-2020 By Taylor, Richard D.; Koo, Won W.; Swenson, Andrew L.
  3. Managing the Economics of Soil Salinity By Hadrich, Joleen C.
  4. Factors Influencing Technical Efficiencies among Selected Wheat Farmers in Uasin Gishu District, Kenya By James Njeru
  5. Property Rights, Institutions and Source of Fuel Wood in Rural Ethiopia By Abebe Damte; Steven F. Koc
  6. Potential for Corn Oil Extracted from Distillersâ Dried Grain and Solubles as a Feedstock for Biodiesel By Ferris, John (Jake)
  7. A Visual Approach to Community Bank Assessment of Agricultural Portfolio Risk Exposure By Pederson, Glenn D.; Chu, Yu-Szu; Richardson, Wynn
  8. The Price Effects of Cash Versus In-Kind Transfers By Cunha, Jesse; De Giorgi, Giacomo; Jayachandran, Seema
  9. Are grain markets in Niger driven by speculation? By Catherine Araujo Bonjean; Catherine Simonet
  10. Missing the target: Lessons from enabling innovation in South Asia By Rasheed, Sulaiman V.; Hall, Andy; Reddy, T.S. Vamsidhar
  11. Rural Non-Farm Incomes and Poverty Reduction in Nigeria By Awoyemi Taiwo Timothy
  12. The Calculation of Rural Urban Food Price Differentials from Unit Values in Household Expenditure Surveys: A new procedure and comparison with existing methods By Amita Majumder; Ranjan Ray; Kompal Sinha
  13. Does franchise extension reduce short-run economic growth? Evidence from New South Wales, 1862-1882 By Edwyna Harris
  14. Safe vs. Fair: A Formidable Trade-off in Tackling Climate Change By Massimo Tavoni; Shoibal Chakravarty; Robert Socolow
  15. The Use of Seemingly Unrelated Regression (SUR) to Predict the Carcass Composition of Lambs By Vasco A. P. Cadavez; Arne Henningsen
  16. Contingent Valuation in Community-Based Project Planning: The Case of Lake Bamendjim Fishery Restocking in Cameroon By William M. Fonta; Hyacinth E. Ichoku; Emmanuel Nwosu
  17. Environmental Regulations, Air and Water Pollution, and Infant Mortality in India By Greenstone, Michael; Hanna, Rema
  18. Impacts of Rural Electrifi cation in Rwanda By Gunther Bensch,; Jochen Kluve; Jörg Peters
  19. Regional Agricultural Endowments and Shifts of Poverty Trap Equilibria: Evidence from Ethiopian Panel Data By Stephen C. Smith; Sungil Kwak

  1. By: Dr shaukat, haseen; Md rehan, khan
    Abstract: Agriculture plays an important role in the process of economic development of less developed countries like India. Besides providing food to nation, agriculture releases labour, provides saving, contributes to market of industrial goods and earns foreign exchange. Agricultural development is an integral part of overall economic development. In India, agriculture was the main source of national income and occupation at the time of Independence. Agriculture and allied activities contributed nearly 50 per cent to India’s national income. Around 72 percent of total working population was engaged in agriculture. Though Indian agriculture is very important, but it largely depends on the climate and weather conditions. India has Monsoon climate in which a year has been divided into two distinct seasons of summer and winter. Rainfall occurs mainly in summer. Solar radiation, temperature, and precipitation are the main drive of crop growth; therefore, agriculture has always been highly dependent on climate patterns and variations. It is clear that India’s agricultural sector has made huge strides in developing its potential. The green revolution massively increased the production of vital food grains and introduced technological innovations into agriculture. This progress is manifested in India’s net trade position. Where once India had to depend on imports to feed its people, since 1990 it is a net exporter of agri-food products. Its agriculture is large and diverse and its sheer size means that even slight changes in its trade have significant effects on world agricultural markets.
    Keywords: Agriculture; Climate; Foodgrains; Agricultural Finance; Agricultural Exports and Imports
    JEL: Q17 Q19 Q13 Q18
    Date: 2011–06–15
  2. By: Taylor, Richard D.; Koo, Won W.; Swenson, Andrew L.
    Abstract: Net farm income in North Dakota was at record levels for most representative farms in 2010. However income in 2020 is projected to be lower than in 2010. Commodity prices are expected to decrease slowly from current levels. Commodity yields are projected to increase at historical trend-line rates and production expenses are expected to return to normal growth rates. Debt-to-asset ratios for all farms except for the low profit farm will decrease slightly throughout the forecast period. Debt-to-asset ratios for the low-profit farms are expected to increase slightly.
    Keywords: net farm income, debt-to-asset ratios, cropland prices, land rental rates, farm operating expenses, capitalization rate, risk, Agricultural Finance, Farm Management, Financial Economics, Land Economics/Use,
    Date: 2011–07
  3. By: Hadrich, Joleen C.
    Abstract: Saline soils result in decreased crop growth and yield with the potential for losing productive farm land. Enterprise budget analysis was extended to include the fixed costs of installing tile drainage to manage soil salinity in the Red River Valley of North Dakota for corn, soybeans, wheat, sugar beets, and barley. Installing tile drainage to manage soil salinity decreased per acre crop profitability from 19-49% due to the large upfront capital investment of tile drainage. These losses can be decreased to zero with more consistent and predictable yields from tile drainage in the intermediate to long run. With no salinity management lost revenues were estimated to be $150 million due to 1.2 million acres of slightly saline soils and 275,000 acres of moderate soil salinity.
    Keywords: Crop Production/Industries, Land Economics/Use,
    Date: 2011–08
  4. By: James Njeru
    Abstract: This study examined the factors influencing technical efficiency in wheat farming in Kenya using a stochastic frontier production function in which technical inefficiency effects were assumed to be functions of both socioeconomic characteristics of the farmer and farm-specific characteristics. The paper used random sampling to interview 160 farmers comprising 97 large-scale farmers and 63 small-scale farmers. The results revealed existence of significant levels of technical inefficiencies in wheatproduction, especially among the large-scale farmers. The study found that the magnitude of technical efficiency varied from one farmer to another and ranged from 48.9% to 95.1%, with a mean of 87.2%. This implied that farmers lost close to 13% of the potential output to technical inefficiencies. There was variation depending on the size of farm with small-scale farmers attaining higher technical efficiency than the large-scale farmers. The main factors that influenced the degree of inefficiency were education levels, access to credit, and ownership of the capital equipment. Higher levels of education (12 years and above or secondary and above) significantly reduced inefficiency as did access to credit facilities and owning the farm equipment. The study recommended that farmers be educated on the use of better techniques such as use of certified seeds and application of recommended levels of fertilizer.
    Date: 2010–11
  5. By: Abebe Damte; Steven F. Koc
    Abstract: This study examines the relationship between property rights, defined by land tenure security and the strength of local-level institutions, and household demand for fuel wood, as measured by the source from which fuel wood is collected. A multinomial regression model is applied to survey data collected in rural Ethiopia. Results from the discrete choice model indicate that active local-level institutions increase household dependency on open access forests, while land security reduces open access forest dependence. However, local-level institutions are found to reduce the role of private fuel wood sources, while tenure security has not, at least yet, had any impact on private fuel wood source collection activities. The results suggest that there is a need to bring more open access forests under the management of the community and increase the quality of community forestry management in order to realize improvements in forest conservation
    Keywords: property rights, institutions, fuel wood, rural, Ethiopia
    JEL: C2 D73 O17 H32
    Date: 2011
  6. By: Ferris, John (Jake)
    Abstract: Rising prices on vegetable oils and animal fats have enabled dry mill ethanol plants to profitably extract corn oil from distillersâ dried grain. While the mandates under the Energy Independence and Security Act of 2007 for grain based ethanol will level off at 15 billion gallons in 2015, the mandates for biodiesel will likely continue to increase from 1.0 billion gallons in 2012 to nearly 2.0 billion gallons in 2022. Corn oil from distillersâ dried grain can provide the needed profits and diversification of feedstock to assist the biodiesel industry in meeting the mandates.
    Keywords: Agribusiness, Crop Production/Industries, Resource /Energy Economics and Policy,
    Date: 2011–09
  7. By: Pederson, Glenn D.; Chu, Yu-Szu; Richardson, Wynn
    Keywords: Financial Economics, Risk and Uncertainty,
    Date: 2011–09
  8. By: Cunha, Jesse; De Giorgi, Giacomo; Jayachandran, Seema
    Abstract: This paper compares how cash and in-kind transfers affect local prices. Both types of transfers increase the demand for normal goods, but only in-kind transfers also increase supply. Hence, in-kind transfers should lead to lower prices than cash transfers, which helps consumers at the expense of local producers. We test and confirm this prediction using a program in Mexico that randomly assigned villages to receive boxes of food (trucked into the village), equivalently-valued cash transfers, or no transfers. The pecuniary benefit to consumers of in-kind transfers, relative to cash transfers, equals 11% of the direct transfer.
    Keywords: Cash and In-Kind Transfers; Prices
    JEL: D4 O12
    Date: 2011–09
  9. By: Catherine Araujo Bonjean (CERDI - Centre d'études et de recherches sur le developpement international - CNRS : UMR6587 - Université d'Auvergne - Clermont-Ferrand I); Catherine Simonet (CERDI - Centre d'études et de recherches sur le developpement international - CNRS : UMR6587 - Université d'Auvergne - Clermont-Ferrand I)
    Abstract: Over the last two decades, millet prices in Niger have enjoyed periods of spectacular growth followed by rapid reversals. During these periods of boom, millet prices seem to deviate from fundamental values. These deviations may be attributed to the presence of rational speculative bubbles. Considering millet as a "food asset" we develop a millet pricing model and test for the presence of periodically and partially collapsing bubbles for 15 millet markets of Niger. The test strategy consists in estimating price deviations from fundamental values and exploiting the theoretical properties of bubbles. The residual augmented least squares (RALS) Dickey-Fuller tests do not rule out the presence of bubbles in millet prices. Moreover, the estimation results from a M-TAR model that captures the asymmetries in the adjustment process of prices to fundamentals, do not reject the presence of rational bubbles for most of the sample markets. Lastly, an attempt is made to identify the origin and collapse date of bubbles using recursive and rolling ADF tests. Results show that small markets, located in deficit and remote areas are more prone to speculation than larger markets of the main producing and consuming regions.
    Keywords: periodically collapsing bubbles;M-TAR;Residual Augmented Least Square;Recursive ADF test;millet market;niger
    Date: 2011–09–26
  10. By: Rasheed, Sulaiman V. (CRISP); Hall, Andy (LINK, Open University and UNU-MERIT); Reddy, T.S. Vamsidhar (Open University)
    Abstract: This paper reflects on the experience of the Research Into Use (RIU) projects in Asia. It reconfirms much of what has been known for many years about the way innovation takes place and finds that many of the shortcomings of RIU in Asia were precisely because lessons from previous research on agricultural innovation were "not put into use" in the programme's implementation. However, the experience provides three important lessons for donors and governments to make use of agricultural research: (i) Promoting research into use requires enabling innovation. This goes beyond fostering collaboration, and includes a range of other innovation management tasks (ii) The starting point for making use of research need not necessarily be the promising research products and quite often identifying the promising innovation trajectories is more rewarding (iii) Strengthening the innovation enabling environment of policies and institutions is critical if research use is to lead to long-term and large-scale impacts. It is in respect of this third point that RIU Asia missed its target, as it failed to make explicit efforts to address policy and institutional change, despite its innovation systems rhetoric. This severely restricted its ability to achieve wide-scale social and economic impact that was the original rationale for the programme.
    Keywords: Research Into Use, Innovation Management, Agricultural Research, Innovation, Development, Policy, Value Chain Development, South Asia, Innovation Trajectory
    JEL: L26 L31 L33 N55 O13 O19 O21 O22 O31 O32 O33 O53 Q13 Q16
    Date: 2011
  11. By: Awoyemi Taiwo Timothy
    Abstract: The study examines some of the factors which determine the type of non-agricultural activities in rural Nigeria an individual engages in. It is argued that diversification from subsistence farming and support for rural on-farm employment opportunities could be poverty-reducing. It has been noticed that an increase in foreign remittances reduces the incidence, depth and severity of poverty in developing countries. This study considers remittances as a source of incomewhich could possibly reduce poverty in the rural sector of the economy.We focus on the non-farmsector because of its potential for development and poverty alleviation in Nigeria.
    Date: 2011–01
  12. By: Amita Majumder; Ranjan Ray; Kompal Sinha
    Abstract: While national and international statistical agencies spend much resource on calculating purchasing power parity (PPP) between countries, relatively little attention is given to PPP calculations within countries. Yet, for large and heterogeneous countries, such as the US and India, intra country PPP is as important as cross-country PPP. This is particularly true of the rural urban divide in such countries where the idea that one unit of currency has the same purchasing power in both sectors is clearly false. This paper addresses this limitation by proposing a demand system based methodology for calculating rural urban PPP that incorporates rural urban differences in preferences and applies it to India. The methodology is compared with conventional procedures, such as the Laspeyre’s price index and the CPD model, and shown to have several advantages over them. The result on significant rural urban price difference in India underlines the need to extend the cross-country PPP calculations to incorporate spatial differences in large, heterogeneous countries with a diverse set of preferences and prices.
    Keywords: Rural Urban PPP, Unit Values, Quality Adjustment, CPD Model
    JEL: C13 D12 E30 R10 R20
    Date: 2011–09
  13. By: Edwyna Harris
    Abstract: Empirical studies have established that franchise extension has positive effects on long-run growth because democratisation leads to greater equality of access to resources. However, in the short-run franchise may lead to a redistribution of resources away from important sectors of an economy. This paper examines this proposition by considering the case of land reform in the colony of New South Wales between 1862 and 1882. Reform was a direct result of franchise extension in preceding years that attempted to reallocate land away from the wool sector to small agriculturalists. Wool producers tried to avoid redistribution of their holdings by expending resources on evading reform legislation. These were resources that could have been invested in productive activities and therefore, it is expected that franchise reduced short-run growth because of the institutional changes it induced. The results presented here confirm that evasion efforts acted to reduce both pastoral sector and total GDP in the short-run.
    Keywords: franchise, land reform, evasion, short-run growth
    JEL: P48 N57 N17
    Date: 2011–09
  14. By: Massimo Tavoni (Princeton Environmental Institute, Princeton University and Fondazione Eni Enrico Mattei); Shoibal Chakravarty (Princeton Environmental Institute, Princeton University); Robert Socolow (Princeton Environmental Institute, Princeton University and Department of Mechanical and Aerospace Engineering, Princeton University)
    Abstract: Global warming requires a response characterized by forward-looking management of atmospheric carbon and respect for ethical principles. Both safety and fairness must be pursued, and there are severe trade-offs as these are intertwined by the limited headroom for additional atmospheric CO2 emissions. This paper provides a simple numerical mapping at the aggregated level of developed vs. developing countries in which safety and fairness are formulated in terms of cumulative emissions and cumulative per capita emissions respectively. It becomes evident that safety and fairness cannot be achieved simultaneously for strict definitions of both. The paper further posits potential global trading in future cumulative emissions budgets in a world where financial transactions compensate for physical emissions: the safe vs. fair trade-off is less severe but remains formidable. Finally, we explore very large deployments of engineered carbon sinks and show that roughly 1000 GtCO2 of cumulative negative emissions over the century are required to have a significant effect, a remarkable scale of deployment. We also identify the unexplored issue of how such sinks might be treated in sub-global carbon accounting.
    Keywords: Climate Policy, Burden Sharing, Negative Emissions
    JEL: Q01 Q56
    Date: 2011–08
  15. By: Vasco A. P. Cadavez (Mountain Research Center (CIMO), ESA - Instituto Politécnico de Bragança (Portugal)); Arne Henningsen (Institute of Food and Resource Economics, University of Copenhagen)
    Abstract: The aim of this study was to develop and evaluate models for predicting the carcass composition of lambs. Forty male lambs of two different breeds were included in our analysis. The lambs were slaughtered and their hot carcass weight was obtained. After cooling for 24 hours, the subcutaneous fat thickness was measured between the 12th and 13th rib and the total breast bone tissue thickness was taken in the middle of the second sternebrae. The left side of all carcasses was dissected into five components and the proportions of lean meat, subcutaneous fat, intermuscular fat, kidney and knob channel fat, and bone plus remainder were otained. Our models for carcass composition were fitted using the SUR estimator which is novel in this area. The results were compared to OLS estimates and evaluated by several statistical measures. As the models are intended to predict carcass composition, we particularly focussed on the PRESS statistic, because it assesses the precision of the model in predicting carcass composition. Our results showed that the SUR estimator performed better in predicting LMP and IFP than the OLS estimator. Although objective carcass classification systems could be improved by using the SUR estimator, it has never been used before for predicting carcass composition.
    Keywords: Carcass, Quality, Ordinary least squares, Seemingly unrelated regression
    Date: 2011–09
  16. By: William M. Fonta; Hyacinth E. Ichoku; Emmanuel Nwosu
    Abstract: The study examined the usefulness and relevance of the contingent valuation method (CVM) in community-based (CB) project planning and implementation. To elicit willingness to pay (WTP) values for the restocking of Lake Bamendjim with Tilapia nilotica and Heterotis niloticus fish species, the study used pre-tested questionnaires interviewer-administered to 1,000 randomly selected households in the Bambalang Region of Cameroon.The datawere elicitedwith the conventional referendumdesign and analysed using a referendum model. Empirical findings indicated that about 85% of the sampled households were willing to pay about CFAF1,054 (US$2.1) for the restocking project. This amount was found to be significantly related to the starting price used in the referendum design, household income, the gender of the respondent, the age of the respondent, household poverty status, and previous participation of a household in a community development project.The findings prompted the following recommendations. Firstly, in order to reduce community burden due to cash constraints, it is advisable for the mean estimate obtained for the scheme to be split into four instalments over a year. Secondly, since the success of the scheme largely depends on the governing roles of the scheme, it is further advisable for the community to allowthemanagement of the scheme to be handled by the elderly community members. Finally, it will be important during the financing of the scheme, to levy wealthier household heads an amount sufficient to subsidize poorer household heads who cannot afford to pay the threshold price.
    Date: 2011–01
  17. By: Greenstone, Michael (MIT); Hanna, Rema (Harvard University)
    Abstract: Using the most comprehensive data file ever compiled on air pollution, water pollution, environmental regulations, and infant mortality from a developing country, the paper examines the effectiveness of India's environmental regulations. The air pollution regulations were effective at reducing ambient concentrations of particulate matter, sulfur dioxide, and nitrogen dioxide. The most successful air pollution regulation is associated with a modest and statistically insignificant decline in infant mortality. However, the water pollution regulations had no observable effect. Overall, these results contradict the conventional wisdom that environmental quality is a deterministic function of income and underscore the role of institutions and politics.
    JEL: H20 O10 Q20 Q50 R50
    Date: 2011–09
  18. By: Gunther Bensch,; Jochen Kluve; Jörg Peters
    Abstract: Rural electrifi cation is believed to contribute to the achievement of the MDG. In this paper, we investigate electrifi cation impacts on diff erent indicators. We use household data that we collected in Rwanda in villages with and without electricity access. We account for self-selection and regional diff erences by using households from the electrifi ed villages to estimate the probability to connect for all households – including those in the non-electrifi ed villages. Based on these probabilities we identify counterfactual households and fi nd robust evidence for positive eff ects on lighting usage. Eff ects on income and children’s home studying become insignifi cant if regional diff erences are accounted for.
    Keywords: Rural electrifi cation; energy access; impact evaluation; matching
    JEL: O12 O13 O18 O22
    Date: 2011–09
  19. By: Stephen C. Smith (Department of Economics/Institute for International Economic Policy, George Washington University); Sungil Kwak (Department of Economics/Institute for International Economic Policy, George Washington University)
    Abstract: We introduce new approaches to research on poverty traps, focusing on changes in patterns of equilibria over time and across regions, applied to the Ethiopia Rural Household Survey. We revisit the incidence of multiple equilibria using new nonparametric techniques; we also emphasize conditions of single equilibria that remain stagnant below the poverty line. We identify a single equilibrium in our initial interval (1994 - 1999) but and evidence that a second, higher equilibrium is emerging in the subsequent (1999 - 2004) interval. One of three major regions exhibits a deeply impoverished equilibrium that does not improve despite a national environment of pro-poor growth.
    Keywords: poverty trap, Ethiopia, multiple equilibria, asset dynamics, regional poverty, sequence of equilibria
    JEL: O1 I3
    Date: 2011–04

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