nep-agr New Economics Papers
on Agricultural Economics
Issue of 2012‒01‒10
seventeen papers chosen by
Angelo Zago
University of Verona

  1. Multimarket Modeling of Agricultural Supply when Crop Land Is a Quasi-fixed Input: A Note By Briones, Roehlano M.
  2. Concept and Unintended Consequences of Weather Index Insurance: The Case of Mexico By Fuchs, Alan; Wolff, Hendrik
  3. Assessment on the Use of Marginal Areas for Cultivation of Feedstock for Biofuel By Briones, Roehlano M.
  4. Do financial investors affect commodity prices? The case of Hard Red Winter Wheat By Girardi, Daniele
  5. Estimating the Importance of the Ethanol Industry to the Iowa Economy in 2011 By Swenson, David A.
  6. Who Benefit from Cash and Food-for-Work Programs in Post-Earthquake Haiti? By Echevin, Damien; Lamanna, Francesca; Oviedo, Ana-Maria
  7. Rural Demography, Public Services and Land Rights in Africa: A Village-Level Analysis in Burkina Faso By Margaret S. McMillan; William A. Masters; Harounan Kazianga
  8. Testing for Explosive Behaviour in Relative Inflation Measures: Implications for Monetary Policy By Vipin Arora; Pedro Gomis-Porqueras; Shuping Shi
  9. Private Trees as Household Assets and Determinants of Tree-Growing Behavior in Rural Ethiopia By Mekonnen, Alemu; Damte, Abebe
  10. Grandir, oui ! Mais comment ? Analyse de la concentration par fusion des cooperatives vinicoles du Languedoc-Roussillon By Saïsset, L.A.; Cheriet, F.
  11. Cross-border coordination in the Madagascar-EU lychee chain: the role of GlobalGAP By Bignebat, C.; Vagneron, I.
  12. Problems and Prospects of Poultry Industry in Bangladesh: An Analysis By Muhammad Mahboob Ali; Md. Moulude Hossain
  13. Economic Instruments for Obesity Prevention: Results of a Scoping Review and Modified Delphi Survey By Guy E.J. Faulkner; Paul Grootendorst; Van Hai Nguyen; Tatiana Andreyeva; Kelly Arbour-Nicitopoulos; Chris Auld; Sean B. Cash; John Cawley; Peter Donnelly; Adam Drewnowski; Laurette Dubé; Roberta Ferrence; Ian Janssen; Jeffrey LaFrance; Darius Lakdawalla; Rena Mendelsen; Lisa Powell; W. Bruce Traill; Frank Windmeijer
  14. Reducing distortions in international commodity markets : an agenda for multilateral cooperation By Hoekman, Bernard; Martin, Will
  15. Persons with Disability (PWDs) in Rural Philippines: Results from the 2010 Field Survey in Rosario, Batangas By Tabuga, Aubrey D.; Mina, Christian D.; Reyes, Celia M.; Asis, Ronina D.; Datu, Maria Blesila G.
  16. Transport and CO2: Productivity Growth and Carbon Dioxide Emissions in the European Commercial Transport Industry By Krautzberger, Lisann; Wetzel, Heike
  17. Are geographical indications a worthy quality signal? A framework with endogenous quality choice By Desquilbet, Marion; Monier-Dilhan, Sylvette

  1. By: Briones, Roehlano M.
    Abstract: Modeling of crop supply frequently adopts separate treatment of area and yield variables. The advantage of this approach is that it conveniently imposes the property of land being a quasi-fixed factor, at least on the aggregate. Given an agricultural land frontier, total supply of land may be fixed in the short run. Various crop multimarket models either ignore this property, thus foregoing the advantage of the area x yield formulation, or impose the aggregate land constraint in an ad hoc fashion. This note proposes a parsimonious area x yield framework of agricultural supply that is firmly rooted in optimization and requires minimal priors for calibration. The framework is designed for direct application in multicommodity modeling of agricultural supply and demand.
    Keywords: Philippines, supply response, area allocation, quasi-fixed factor
    Date: 2011
  2. By: Fuchs, Alan (University of California, Berkeley); Wolff, Hendrik (University of Washington)
    Abstract: Recently, Weather Index Insurance (WII) has received considerable attention as a tool to insure farmers against weather related risks, particularly in developing countries. Donor organizations, local governments, insurance companies, development economists as well as agricultural economists are discussing the costs and benefits of WII. While the literature on WII has mainly focused on many cases in Africa and Asia, in this article we analyze the WII program in Mexico, which is one of the largest WII programs worldwide. In this context we discuss potentially important spill-over effects on related markets which so far have not been considered in the academic literature. First, we argue that WII creates disincentives to invest in other non-insured crops leading to potential overspecialization and monoculture. Secondly, WII generates disincentives to invest in irrigation systems because farmers are insured only as long as production takes place on non-irrigated land. Third, in case of catastrophic events food prices can potentially inflate with indemnity payments at the expense of the uninsured poor. We also suggest that in Mexico the thresholds of the weather index be (continuously) re-calibrated in order to adjust for the development of drought resistant seeds. Finally, the index could relatively easily be extended to account for precipitation variances. We argue that these factors and spillover effects should be accounted for in cost benefit analysis of WII.
    Keywords: Weather Index Insurance, policy evaluation, Mexico
    JEL: Q11 Q14 O13 G22
    Date: 2011–12
  3. By: Briones, Roehlano M.
    Abstract: The Philippines has made a major push toward development of biofuel, enacting biofuels mandates and subsidies by the Biofuels Law. To maintain food security, biofuels policies currently restrict feedstock production to marginal lands. This raises its own issues related to commercial viability, small farmer livelihood, and environmental sustainability. This study conducts a field investigation of these issues, covering small holder feedstock producers producing sugarcane, cassava, and coconut. The study finds the following: i) Biofuels development in marginal areas are potentially profitable ventures for investors, assuming stable physical and economic environment, as well as a predictable policy environment. ii) Contract growing arrangements have been largely advantageous to farmers. iii) Farmers who have entered into contract growing arrangements have a reasonable expectation of improved livelihoods. iv) Biofuels development in marginal lands are not expected to cause significant input intensification, although expansion of cultivated area for emerging feedstock such as cassava should be monitored. Rather than small holder exploitation, or environmental degradation, this study points to other major development concerns, namely maintaining policy coherence, containing costs imposed on the fuel-buying public, and rethinking the biofuel mandate, in favor of other instruments for promoting indigenous sources of renewable energy.
    Keywords: Philippines, environmental degradation, illegal gambling, capital gains, capital gain tax, biofuels development, marginal lands, rural livelihoods
    Date: 2011
  4. By: Girardi, Daniele
    Abstract: The aim of this paper is to assess empirically whether speculative financial investments have affected wheat price dynamics in recent years. To address this issue we will (1) analyze recent agricultural price dynamics and their drivers (2) outline the process of ‘financialization’ of agricultural commodity markets, identifying the macroeconomic, monetary and legislative factors which favored it and (3) present an econometric analysis using Hard Red Winter (HRW) wheat as a case study. Since 2007 HRW wheat price fluctuations have been positively related to US stock market returns and oil price movements. These correlations appear to be determined by commodity index traders, a category of financial investors, since both these relationships proved to be spurious, with the most tracked commodity index as the confounding variable.
    Keywords: Agricultural Commodity Prices; Global Commodity Crises; Financialization; Commodity Futures Markets; Commodity Index Trading; Agricultural Markets; Commodity Futures Pricing
    JEL: Q17
    Date: 2011–11–15
  5. By: Swenson, David A.
    Abstract: At ISU we produce estimates of the total value of certain industries to the state’s economy using modeling systems that contain up-to-date secondary data on the major components of industrial production in the state.  We, for example, periodically describe the importance of agriculture and ag-related manufacturing to jobs and incomes in Iowa for the College of Agriculture and Life Sciences as it promotes its education and outreach services to its many and diverse stakeholders.  Similar studies have been done for manufacturing clusters, like the Cedar Rapids area food and kindred products manufacturing sector, or whole industries, like the state’s vaunted insurance sector.This report summarizes the ethanol industry’s value to the state of Iowa using the same methods ISU employs with other industries it periodically evaluates as well as the same methods it has deployed in previous studies of Iowa’s ethanol sector.
    Keywords: corn ethanol; economic impacts
    Date: 2011–12–30
  6. By: Echevin, Damien; Lamanna, Francesca; Oviedo, Ana-Maria
    Abstract: In this paper, a unique post-earthquake survey designed to provide a rapid assessment of food insecurity in Haiti is used in order to address the question of whether cash and food-for-work (C/FfW) programs are allocated adequately in Haiti. We consider that the allocation principle should meet two main criteria. First, C/FfW programs should be targeted towards people who are in the most necessitous circumstances (i.e., poor and food insecure people). Second, these programs should be targeted at the most vulnerable people on the labor market. Modelling the impact of various covariates on C/FfW programs participation, we find that these programs are not specifically targeted at people who are most in need, be it because of their low level of subsistence or because of earthquakerelated losses. Pre-earthquake participation to programs appears to be an important determinant of post-earthquake participation. What is more, cash-forwork is very rarely declared as the main source of household income. So, a more efficient targeting of these programs should focus on reaching the poorest and most vulnerable households in the directly affected areas. Crowding out effect of temporary jobs should also be assessed on the labor market.
    Keywords: Cash and Food for Work; Targeting; Livelihood; Earthquake; Natural Disaster; Haiti
    JEL: I38 H53 Q18
    Date: 2011
  7. By: Margaret S. McMillan; William A. Masters; Harounan Kazianga
    Abstract: This paper uses historical census data from Burkina Faso to characterize local demographic pressures associated with internal migration into river valleys after Onchocerciasis eradication, combined with a new survey of village elders to document change over time and differences across villages in local public goods provision, market institutions and land use rights. We hypothesize that higher local population densities are associated with more public goods and a transition from open-access to regulated land use. Controlling for province or village fixed effects, we find that villages’ variance in population associated with proximity to rivers is closely correlated with higher levels of infrastructure, markets and individual land rights, as opposed to familial or communal rights. Responding to population growth with both improved public services and private property rights is consistent with both scale effects in public good provision, and changes in the scarcity of land.
    JEL: F20 H41 I18 J11 O12 O20
    Date: 2011–12
  8. By: Vipin Arora; Pedro Gomis-Porqueras; Shuping Shi
    Abstract: In this paper we test for large deviations in headline measures of the price level relative to core measures using the recently proposed test of Phillips et al. (2011a). We find evidence of explosive behaviour in the headline price index of personal consumption expenditures (PCE) relative to the core PCE (less food and energy prices) on three occasions from 1982-2010. Two of these episodes correspond to energy supply shocks (OPEC price collapse of 1986 and Hurricane Katrina). The third one is during March 2008 through September 2008 which seems to be driven by both food and energy prices as these indices exhibit explosive behaviour. We also find evidence suggesting that inflation expectations behave differently under normal and explosive periods. In particular, unemployment and interest rates also help predict inflation expectations during explosive episodes relative to normal times. Furthermore, explosive episodes in the relative measure between headline and core inflation is found to be more important than the relative volatile periods implied by a Markov-switching model when studying inflation expectations. The findings of this paper suggest that explosive behaviour of headline versus core PCE should be taken into account when conducting monetary policy as it is a key determinant in consumers’ inflation expectations.
    Keywords: Explosive behaviour, core inflation, relative measure, inflation expectations
    JEL: C5 E31
    Date: 2011–12
  9. By: Mekonnen, Alemu; Damte, Abebe
    Abstract: This study looked into tree-growing behavior of rural households in Ethiopia. With data collected at household and parcel levels from the four major regions of Ethiopia, we analyzed the decision to grow trees and the number of trees grown, using such econometric strategies as a zero-inflated negative binomial model, Heckman’s two-step procedure, and panel data techniques. Our findings show the importance of analysis at the parcel level in addition to the more common household-level. Moreover, the empirical analysis indicates that the determinants of the decision to grow trees are not necessarily the same as those involved in deciding the number of trees grown. Land certification, as an indicator of tenure security, increases the likelihood that households will grow trees, but is not a significant determinant of the number of trees grown. Other variables, such as risk aversion, land size, adult male labor, and education of household head, also influence the number of trees grown. In general, the results suggest the need to use education and/or awareness of the role and importance of trees and point out the importance of household endowments and behavior, such as land, labor, and risk aversion, for tree growing. Finally, we observed that, while tree planting is practiced in all four regions covered, there are variations across regions.
    Keywords: trees as assets, tree growing, Ethiopia
    JEL: Q15 Q23
    Date: 2011–12–28
  10. By: Saïsset, L.A.; Cheriet, F.
    Abstract: Cooperatives are a specific type of organization. For a century, they represented an important means of organisational and strategic structuring of agricultural and food sectors in France. By the early 1990s, an accelerated process of concentration is observed between agricultural cooperatives. The purpose of our work is to analyze the concentration process mainly by mergers of agricultural cooperatives. The analysis of 14 wine cooperatives mergers in Languedoc-Roussillon wine between 2004 and 2010 is our empirical application. The main results indicate that there are different types of "process" of mergers: some are done without any backup strategy, while others respond to orders of local policies. Finally, in other cases, mergers are based on real corporate strategic projects to find synergies between the involved cooperatives. ...French Abstract : Les coopératives constituent un mode organisationnel spécifique. Elles représentent un vecteur important de structuration de certaines filières agricoles et agroalimentaires en France depuis près d’un siècle. Dès le début des années 1990, une accélération du mouvement de concentration entre coopératives agricoles est observée. L’objet de notre travail est d’analyser le processus de rapprochement (par fusion et acquisition) des coopératives agricoles. Le suivi de 14 opérations de fusions de coopératives vinicoles du Languedoc-Roussillon entre 2004 et 2010 constitue notre application empirique. Les principaux résultats indiquent qu’il existe différents types de « processus » de fusions : certaines sont menées dans l’urgence sans aucune stratégie que la sauvegarde d’exploitations en difficultés, alors que d’autres répondent à des injonctions des politiques locales. Enfin, d’autres reposent sur de véritables projets stratégiques d’entreprise permettant de trouver des synergies entre les structures coopératives engagées.
    JEL: L14 L21 Q13
    Date: 2011
  11. By: Bignebat, C.; Vagneron, I.
    Abstract: Madagascar has a tradition of agricultural trade (coffee, vanilla, cloves). In the 90s, the country started developing non-traditional exports, such as lychees, to the European Union (EU), thereby generating substantial cash revenues for small producers. In 2005, access to the EU market became more difficult, due to more stringent quality requirements and to the growing use of the private retailer standard GlobalGAP. Whereas the empirical literature on private standards presents GlobalGAP either as a success story or a threat for small producers, the case of Madagascar exhibits a specific dynamics: after booming in 2007, GlobalGAP is actually collapsing. The aim of this article is to disentangle the mechanisms of this evolution and to draw some conclusions regarding market access enhancement through private standards. This work is based on semi-structured interviews carried out with all stakeholders of the export chain, government agencies and programs supporting lychee production and on weekly data on lychee trade flows (2001-2010). Using a global value chain approach, we first show the importance of the chain structure: importers are identified as lead-firms (conversely to most studies dealing with private certification) in an environment characterized by low competition at the international level. We then evaluate the role of donors and trade facilitators as actors of the chain. After giving evidence for the collapse of GlobalGAP, we assess what is left of the GlobalGAP procurement system once it has been abandoned: stabilization of the relationship between exporters and producers and thus enhanced traceability, upgrading of private marketing infrastructures, improved management discipline. We conclude that in the Madagascar lychee chain, although GlobalGAP had little impact on market access.
    JEL: Q13 O19 L22
    Date: 2011
  12. By: Muhammad Mahboob Ali; Md. Moulude Hossain (Presidency University, Bangladesh; Institute of Science and Technology, National University)
    Abstract: The poultry industry has been successfully becoming a leading industry of Bangladesh. The primary objective of the study is to identify the various aspect relating the growth and sustainability of poultry industry in Bangladesh. Authors argued that strategic management in poultry sector requires complementing to achieve present Govt.’s vision of Digital Bangladesh 2021. Considering the importance of the country’s poultry industry in order to ensure the sustainable economic development it is now high time to step forward for the better accumulation of resources available from this industry. This industry proves various opportunities of increasing GDP growth rate plus equitable distribution through arranging food security as well as ensuring self-employment at a large scale as pointed out by the authors.
    Date: 2012–12
  13. By: Guy E.J. Faulkner; Paul Grootendorst; Van Hai Nguyen; Tatiana Andreyeva; Kelly Arbour-Nicitopoulos; Chris Auld; Sean B. Cash; John Cawley; Peter Donnelly; Adam Drewnowski; Laurette Dubé; Roberta Ferrence; Ian Janssen; Jeffrey LaFrance; Darius Lakdawalla; Rena Mendelsen; Lisa Powell; W. Bruce Traill; Frank Windmeijer
    Abstract: Comprehensive, multi-level approaches are required to address obesity. One important target for intervention is the economic domain. The purpose of this study was to synthesize existing evidence regarding the impact of economic policies targeting obesity and its causal behaviours (diet, physical activity), and to make specific recommendations for the Canadian context.
    Date: 2011–12
  14. By: Hoekman, Bernard; Martin, Will
    Abstract: Global commodity markets are affected by a variety of government policies that may expand or lower overall supply and as a result affect world prices for the specific products concerned. Market failures and market structures (market power along the value chain) also affect supply. This paper briefly reviews a number of factors that may distort international commodity markets with a view to identifying elements of an agenda for multilateral cooperation to reduce such distortions. Much of the policy agenda that arises is domestic and requires action by national governments. But numerous policies -- or absence of policy -- generate international spillovers that call for the negotiation of international policy disciplines. Independent of whether distortions are local or international in scope, the complexity of prevailing market structures and their impacts on efficiency call for much greater monitoring and analysis by the international community.
    Keywords: Markets and Market Access,Economic Theory&Research,Emerging Markets,Access to Markets,Free Trade
    Date: 2012–01–01
  15. By: Tabuga, Aubrey D.; Mina, Christian D.; Reyes, Celia M.; Asis, Ronina D.; Datu, Maria Blesila G.
    Abstract: In an effort to complement the 2008 disability survey conducted in Metro Manila, the University of Tokyo and the Philippine Institute for Development Studies collaborated to undertake a similar study in a rural area. The survey was conducted in Rosario, Batangas in 2010, where 106 PWDs from 31 barangays were interviewed.Some of the major findings of the survey are as follows: The majority of the respondents did not even finish elementary education. The most common reason for not going to school ever or completing schooling is poverty. Employment rate among the respondents, however, is slightly lower (at 47%) than that in Metro Manila (50%). If the visually-impaired has the highest proportion with income-generating jobs (72%) in Metro Manila (who are usually masseurs), the hearing-impaired has the highest employment rate (58%) in Rosario, who are usually farmers/farm workers. Very few of the respondents are members of the Municipal Federation of PWDs, which is the only Disability Self-Help Organization in Rosario. Moreover, only 3 out of 10 respondents are aware of the important policies that were intended to improve their well-being. Among the 31 respondents who have knowledge about any of the policies on discounts, only 10 of them have ever enjoyed at least one of these discounts and possess a PWD ID card. Lack of awareness and participation stem from not having the chance to go out and mingle with other people reflecting the social, economic, and physical constraints that PWDs in rural areas are facing.
    Keywords: Philippines, macroeconomic outlook, persons with disability (PWDs), rural, survey, Rosario, Batangas
    Date: 2011
  16. By: Krautzberger, Lisann (Energiewirtschaftliches Institut an der Universitaet zu Koeln); Wetzel, Heike (Energiewirtschaftliches Institut an der Universitaet zu Koeln)
    Abstract: In the last decades transport activities persistently increased in the EU27 and were strongly coupled to growth in GDP. Like most production processes, they are inevitably linked with the generation of environmentally hazardous by-products, such as CO2 emissions. This leads to the question of how to promote a sustainable transport sector that meets both environmental protection targets and economic requirements. In this context, the objective of this paper is to compare the CO2-sensitve productivity development of the European commercial transport industry for the period between 1995 and 2006. We calculate a Malmquist-Luenberger productivity index to investigate the effects of country-specific regulations on productivity and to identify innovative countries. Our results show a high variation in the CO2-sensitive productivity development and a slight productivity decrease on average. Efficiency losses indicate that the majority of the countries were not able to follow the technological improvements induced by some innovative countries.
    Keywords: European transport industry; Carbon dioxide emissions; Productivity growth; Malmquist-Luenberger index
    JEL: L92 Q47 Q53 Q56
    Date: 2012–01–02
  17. By: Desquilbet, Marion; Monier-Dilhan, Sylvette
    Abstract: The paper provides a theoretical framework to analyze the effects of Protected Designation of Origin labeling on quality choices and welfare. Our model distinguishes two attributes of goods: a search attribute (gustatory quality) and a credence attribute (geographical origin). We compare equilibria with no label, denomination standard and minimum quality standard. We find that the PDO good is not necessarily the high-quality good. When it is, the introduction of denomination standard causes a decrease in quality. Minimum quality standard is warranted to maintain the quality level of the labelable good, but they affect the PDO firm.
    Keywords: Geographical Indications, Vertical Differentiation, Welfare, Quality Certification
    JEL: D21 L15 L51
    Date: 2011–12

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