nep-agr New Economics Papers
on Agricultural Economics
Issue of 2012‒09‒09
fifteen papers chosen by
Angelo Zago
University of Verona

  1. Rural Policies and Poverty in Tanzania: an Agricultural Household Model-Based Assessment By Marco Tiberti; Luca Tiberti
  2. Climate change, agriculture and food security in Tanzania By Arndt, Channing; Farmer, William; Strzepek, Kenneth; Thurlow, James
  3. IFRS for SMEs: What will the implementation of IFRS for SME bring for timber industry? By Hana Bohusova; Patrik Svoboda; Petr Valouch
  4. Measurement of agricultural producers' groups performance: Background, features and objectives By Kamila Ruzickova; Jan Vavrina
  5. Time-Frequency Dynamics of Biofuels-Fuels-Food System By Lukas Vacha; Karel Janda; Ladislav Kristoufek; David Zilberman
  6. GMO: What is the Market Saying By Mark, Dermod
  7. Fluctuating staple prices and household poverty in India By Shutes, Lindsay; Ganesh-Kumar, Anand; Meijerink, Gerdien W.
  8. Trade and agricultural policies in Malawi: Not all policy reform is equally good for the poor By Douillet, Mathilde
  9. Seed market liberalization, hybrid maize adoption, and impacts on smallholder farmers in Tanzania By Kathage, Jonas; Qaim, Matin; Kassie, Menale; Shiferaw, Bekele A.
  10. Trade policies and agricultural exports of Sub-Saharan African countries: Some stylized facts and perspectives By Douillet, Mathilde
  11. Poverty and employment impact of trade liberalization in Nigeria: empirical evidence and policy implications By Balogun, Emmanuel Dele; Dauda, Risikat O. S.
  12. Characterizing commercial cattle farms in Namibia: risk, management and sustainability By Roland Olbrich; Martin F. Quaas; Stefan Baumgaertner
  13. Water Scarcity and Birth Outcomes in the Brazilian Semiarid By Rudi Rocha; Rodrigo R. Soares
  14. Ecomarkets For Conservation And Sustainable Development in the Coastal Zone By R. Fujita; A.C. Markham; J. Lynham; F. Lynham; P. Feinberg; L. Bourillon; A. Lynham
  15. The Political Economy of Deforestation in the Tropics By Robin Burgess; Matthew Hansen; Benjamin Olken; Peter Potapov; Stefanie Sieber;

  1. By: Marco Tiberti; Luca Tiberti
    Abstract: The main objective of this study is to develop a robust and comprehensive tool to evaluate the effect on households’ welfare of different agricultural policies in Tanzania. This is done through a non-separable agricultural household model where production and consumption decisions are considered. In particular, we look at labour market failure, since this is among the major constraints in a context like rural Tanzania. Non-separability implies that production and consumption decisions are interlinked and that labour allocation is likely to be determined by shadow wages rather than market wages. A two-stage estimation strategy is adopted: the shadow price of family labour is first estimated and then included into the production and demand systems. The impact of a number of agricultural policies on poverty is then estimated. In particular, we evaluate the impact of policies established by the Agricultural Sector Development Programme, as well as changes in food prices.
    Keywords: Agricultural household models, poverty, agricultural policies, Tanzania
    JEL: D12 O12 O13 Q12 Q18
    Date: 2012
  2. By: Arndt, Channing; Farmer, William; Strzepek, Kenneth; Thurlow, James
    Abstract: The consequences of climate change for agriculture and food security in developing countries are of serious concern. Due to their reliance on rain-fed agriculture, both as a source of income and consumption, many low-income countries are considered to be the most vulnerable to climate change. This paper estimates the impact of climate change on food security in Tanzania. Representative climate projections are used in calibrated crop models to predict crop yield changes for 110 districts in the country. The results are in turn imposed on a highly-disaggregated, recursive dynamic economy-wide model of Tanzania. The authors find that, relative to a no-climate-change baseline and considering domestic agricultural production as the principal channel of impact, food security in Tanzania appears likely to deteriorate as a consequence of climate change. The analysis points to a high degree of diversity of outcomes (including some favorable outcomes) across climate scenarios, sectors, and regions. Noteworthy differences in impacts across households are also present both by region and by income category.
    Keywords: Climate Change Mitigation and Green House Gases,Climate Change Economics,Regional Economic Development,Science of Climate Change,Food&Beverage Industry
    Date: 2012–09–01
  3. By: Hana Bohusova (Department of Accounting and Taxes, Faculty of Business and Economics, Mendel University in Brno); Patrik Svoboda (Department of Accounting and Taxes, Faculty of Business and Economics, Mendel University in Brno); Petr Valouch (Faculty of Economics and Administration, Masaryk University)
    Abstract: At vero Agricultural activity and forestry are largely different from other activities that the entities perform in order to achieve profit. Unlike other business entities, agricultural produce is significantly dependent on natural climatic conditions, and therefore a particular specialization of agricultural produce depends on geographic location. Agricultural and forest producers use every form of business organization, from small farms to large publicly held corporations. Although most entrepreneurs working in agriculture and forestry are small and medium enterprises, the specifics of agriculture are significantly reflected in the financial reporting intended primarily for large corporations traded on the capital markets. There are designed specific procedures of recording in relation to the nature of biological assets and agricultural produce and ways of measurement in this paper. The nature of biological assets is considered as distinguishing criterion (consumable assets, bearer assets and consumable assets with long production cycle).
    Keywords: agricultural activity, IFRS for SMEs, biological assets, agricultural produce
    JEL: M4
    Date: 2012–09
  4. By: Kamila Ruzickova (Department of Economics, Faculty of Business and Economics, Mendel university in Brno); Jan Vavrina (Department of Economics, Faculty of Business and Economics, Mendel university in Brno)
    Abstract: The economic performance of an enterprise obviously depends on various internal and external factors. Those factors are not only the input variables entering various aggregated calculations but also analytical inputs as the effectiveness of company processes, management of costs, innovation capabilities, further sustainable development and in the case of agriculture in the EU also the public subsidy schemes implemented through the EU Common Agricultural Policy. In this article, the basic economic performance measures are presented, and their applicability on the sample of agricultural producers' groups and wholesale entities is verified. There are specific constraints of these entities, as for example in the producers' groups legal agreements ensuring the sale of member enterprises' production or cooperative purchasing of production inputs. Therefore, the performance of agricultural producers’ groups directly affects the economic performance of all participating entities. According to the structure and characteristics of agricultural producers' groups may be inferred that whilst the common performance measurement techniques are applicable on the majority of companies, agricultural producers' groups represent specific entities and therefore there is a need for adjusted performance measurement approach. The aim of this paper is thus firstly, to discuss the traditional techniques for performance measurement and highlight the input data sources, as well as practically verify their applicability on the sample of Czech agricultural producers' groups and wholesale, both operating within the field of fruit and vegetables; and secondly, to provide a basis for further research in employment of analytical performance measurement systems as Balanced Scorecard or Benchmarking in this branch of business.
    Keywords: agri-business, agricultural producers' group, benchmarking, economic performance
    JEL: L25 Q13 M21
    Date: 2012–09
  5. By: Lukas Vacha; Karel Janda; Ladislav Kristoufek; David Zilberman
    Abstract: For the first time, we apply the wavelet coherence methodology on biofuels (ethanol and biodiesel) and a wide range of related commodities (gasoline, diesel, crude oil, corn, wheat, soybeans, sugarcane and rapeseed oil). This way, we are able to investigate dynamics of correlations in time and across scales (frequencies) with a model-free approach. We show that correlations indeed vary in time and across frequencies. We find two highly correlated pairs which are strongly connected at low frequencies - ethanol with corn and biodiesel with German diesel - during almost the whole analyzed period (2003-2011). Structure of correlations remarkably changes during the food crisis - higher frequencies become important for both mentioned pairs. This implies that during stable periods, ethanol is correlated with corn and biodiesel is correlated with German diesel mainly at low frequencies so that they follow a common long-term trend. However, in the crisis periods, ethanol (biodiesel) is lead by corn (German diesel) even at high frequencies (low scales), which implies that the biofuels prices react more rapidly to the changes in their producing factors.
    Date: 2012–09
  6. By: Mark, Dermod
    Keywords: Agricultural Finance,
    Date: 2012–08–28
  7. By: Shutes, Lindsay; Ganesh-Kumar, Anand; Meijerink, Gerdien W.
    Abstract: The general perception is that high food prices in India have increased poverty and that trade reforms will further worsen poverty. We compare Foster-Greer-Thorbecke poverty measures for various scenarios of grain price swings with and without trade reform, using price and income effects for 32 representative households computed from a global economic model and a model of India's economy. The results suggest that a rise in the global rice price actually provides strong opportunities for poverty alleviation. Global trade reform reinforces this effect for all rural population groups. An increase in urban poverty partly offsets the overall poverty reduction. While India's trade measures effectively isolate sectors from swings in global markets, they also cause India to miss opportunities to benefit from buoyant global prices.
    Keywords: Poverty; food prices; trade; CGE analysis; India; household analysis
    JEL: C68 O24 Q11 Q18 I32
    Date: 2012–08–31
  8. By: Douillet, Mathilde
    Abstract: The reduction of the existing global distortions to agricultural incentives is sometimes stated as a priority to fight poverty worldwide. But the impacts of global trade policy and domestic development policy reforms are rarely, if ever, compared. Despite technical limitations hindering rigorous comparison of the overall growth effects, also hampering cost-benefit analysis, this paper contributes at filling this gap by focusing on the comparison of the distributional poverty impacts of both types of policies. It uses the MIRAGE global computable general equilibrium –CGE- model feeding a national CGE model representing Malawi in 2007 linked to household survey to examine how different trade policy reforms by Malawi and the rest of the world would impact poverty in Malawi. The country’s recent agricultural growth history due to the Fertilizer Input Subsidy Program is replicated and compared with a more broad-based sectoral approach. The effects of accelerating growth in agriculture and downstream sectors are compared with those of integrating in the regional and multilateral markets. Non preferential trade policy reforms are found to be less favourable for poverty reduction of the poorest than regional integration or preferential integration. Faster intensification and diversification of agriculture is found to enable targeting the poorest that are less likely to be connected to international markets. Therefore, while policy reforms generating growth in general may be good for some poors, it is found that that not all policy reforms are equally good. Thus, despite the fact that trade policies could help fight poverty in Malawi, there are no substitute to development policies, and if undertaken simultaneously, their coherence should be checked thoroughly.
    Keywords: Malawi; Economic Growth; Trade policy; Agricultural Policy; Poverty; Computable General Equilibrium
    JEL: F13 O55 Q17 D58 Q18
    Date: 2012
  9. By: Kathage, Jonas; Qaim, Matin; Kassie, Menale; Shiferaw, Bekele A.
    Abstract: Since the early 1990s, liberalization of the seed market in Tanzania has attracted several foreign companies that now market maize hybrids in the country. In this article, we analyze the impacts of proprietary hybrids on maize yields, production, and household living standards. We build on a recent survey of smallholder maize farmers in two zones of Tanzania. Hybrid adoption rates are 48% and 13% in the North and East, respectively. Average net yield gains of hybrids are 50-60%, and there are also significant profit effects. Geographical disaggregation reveals that the benefits have mostly occurred in the North, which also explains higher adoption there. In the North, hybrid adoption caused a 17% increase in household living standards. We conclude that proprietary hybrids can be suitable for semi-subsistence farms and that seed market liberalization has generated positive socioeconomic developments.
    Keywords: seed market liberalization, farm survey, technology adoption, household living standards, Tanzania, Industrial Organization, International Development, Production Economics, Research and Development/Tech Change/Emerging Technologies, I31, Q12, Q13, Q16,
    Date: 2012–05
  10. By: Douillet, Mathilde
    Abstract: It has long been consensual that limited market demand within poor African countries have hampered economic development of Sub-Saharan Africa and that countries therefore needed to rely on exports markets to spur economic growth. But despite benefiting from preferential agreements, Sub-Saharan African countries have been marginalized from global trade. Indicators of the exports of Sub-Saharan African countries are constructed to reflect their characteristics. Existing trade negotiating options are examined in the current context of agricultural markets. It appears that prospects at the regional level arise as well as at the global level, especially when looking at the opportunities from a policy coherence for development perspective. Regional prospects are even more acute in light of the global economic crisis affecting traditional trade partners.
    Keywords: Africa; Trade policy; Agriculture
    JEL: O55 F13 Q17
    Date: 2012–07
  11. By: Balogun, Emmanuel Dele; Dauda, Risikat O. S.
    Abstract: This paper analyzes quarterly data which spans the period 1985 to 2010 to investigate the interrelationship between trade liberalisation, employment dynamics and the implications for poverty alleviation in Nigeria. An overview of macroeconomic trends and patterns during the period show that although the Nigerian economy experienced growth, it was accompanied by rapid rise in unemployment and poverty. The econometric analysis, estimated by systems equation model, related terms of trade, implicit producer price incentives, openness and macroeconomic policy outcomes on agricultural and industrial sector incomes per capita and total trade. The findings tended to show that the fortunes of these sectors deteriorated contrary to the assertion that a positive relationship exists between liberalization and poverty reduction via improved productivity of labor intensive smallholder farm and firms enterprises. While the apparent growth in total trade seemed to be buoyed by positive export supply shocks, deteriorating terms of trade and biased producer incentives structure penalized domestic manufactures and farming, thereby accentuating poverty. This adverse consequence is attributable to the adoption of import substitution industrialization strategy which encouraged the influx of foreign firms that are appendages of multinationals. In concluding, the paper calls for a shift in policy approach to economic development from the pervasive import substitution trade strategies which tended to displace labor to an export led strategy guided by the doctrine of factor endowments.
    Keywords: Trade liberalization; Employment; Poverty reduction
    JEL: F16 C32
    Date: 2012–08–26
  12. By: Roland Olbrich (Department of Sustainability Sciences and Department of Economics, Leuphana University Lueneburg, Germany); Martin F. Quaas (Department of Economics, University of Kiel, Germany); Stefan Baumgaertner (Department of Sustainability Sciences and Department of Economics, Leuphana University Lueneburg, Germany)
    Abstract: Commercial cattle farming in Namibia, a prime example of livestock farming in semi-arid rangelands, is subject to a variety of risks, predominant among which is precipitation risk. At the same time it suffers from rangeland degradation that is at least partly due to inadequate management. We characterize cattle farms through descriptive statistics and cluster analysis using data that we elicited in August 2008 through mail-in questionnaires and in-field experiments. We find that cattle farms are highly heterogeneous in the majority of individual characteristics. Heterogeneity is also observed when analyzing characteristics jointly through the cluster analysis which suggests classification of farms into three distinct clusters. This classification is predominantly driven by environmental condition and financial risk management, and to a lesser extent by organizational structure of farms or ethnicity. Overall, our study is the first to provide a comprehensive characterization of this system in respect to risk, management and sustainability.
    Keywords: cattle farming, semi-arid rangelands, Namibia, empirical survey, perceived risk, management, risk and time preferences, normative views, sustainability
    JEL: Q12 Q15 Q57
    Date: 2012–08
  13. By: Rudi Rocha (UFRJ); Rodrigo R. Soares (Department of Economics PUC-Rio)
    Abstract: This paper analyzes the impact of rainfall fluctuations during the gestational period on health at birth. We concentrate on the semiarid region of Northeastern Brazil to highlight the role of water scarcity as a determinant of early life health. We find that negative rainfall shocks are robustly correlated with higher infant mortality, lower birth weight, and shorter gestation periods. Mortality effects are concentrated on intestinal infections and malnutrition, and are greatly minimized when the local public health infrastructure is sufficiently developed (municipality coverage of piped water and sanitation). We also …nd that e¤ects are stronger during the fetal period (2nd trimester of gestation), for children born during the dry season, and for mortality in the first 6 months of life. The results seem to be driven by water scarcity per se, and not by reduced agricultural production. Our estimates suggest that expansions in public health infrastructure would be a cost-effective way of reducing the response of infant mortality to rainfall shocks in the Brazilian semiarid
    Date: 2012–08
  14. By: R. Fujita (Environmental Defense Fund, San Francisco, CA 94105, USA); A.C. Markham (Environmental Defense Fund, San Francisco, CA 94105, USA); J. Lynham (Department of Economics, University of Hawaii at Manoa, USA); F. Lynham (Hopkins Coastal Station, Stanford University, Pacific Grove, CA 93950, USA); P. Feinberg (School of Earth Sciences, Stanford University, Stanford, CA 94305, USA); L. Bourillon (Comunidad y Biodiversidad, A.C. (COBI), Cancún, Quintana Roo 77500, México); A. Lynham (Comunidad y Biodiversidad, A.C. (COBI), Popocatepetl)
    Abstract: Because conventional markets value only certain goods or services in the oceans(e.g., fish), other services prodvideded by coastal an marine ecosystems that l tend to become degraded. In fact, the very capacity of an ecosystem to produce a valued good is often reduced because markets are valuing only the good, not the productive capacity. Coastal socio-ecosystems are perhaps particularly susceptible to these market failures due to the lack of clear property rights. Conservation strategies aimed at protecting coastal ecosystem services that are not valued by conventional markets by banning industrial or subsistence use in certain areas (Marine Protected Areas) often result in lost revenue and adverse social impacts, which in turn create conflict and opposition. Here, we describe markets and financial tools – “ecomarkets”– that could, under the right conditions, value wide portfolios of coastal ecosystem services and generate revenues while maintaining ecosystem structure and function by addressing the unique problems of the coastal zone, including a lack of clear rights of management and exclusion. Just as coastal tenure and catch share systems generate meaningful conservation and economic outcomes, it is possible to imagine other market mechanisms that do the same with respect to a variety of other coastal ecosystem goods and services. These approaches could allow communities to stop relying exclusively on extracting from natural systems, and instead to diversify uses and focus on longterm stewardship and conservation while meeting development, food security, and human welfare goals. Diversification of use and the preservation of intact coastal ecosystems are in turn likely to increase the resilience of socio-ecological systems to unanticipated stresses, for example, as a result of climate change or new human activities. The creation of ecomarkets will be difficult in many cases, because rights and responsibilities must be devolved, new social contracts will be required, accountability systems must be created and enforced, and longterm patterns of behavior must change. We argue that efforts to overcome these obstacles are justified, because these deep changes will strongly complement policies and tools such as Marine Protected Areas, coastal spatial management, and effective regulation, and thereby help bring coastal conservation to scale.
    Keywords: Ecomarkets, incentives, ecosystem services, property rights, coastal spatial planning and management, coastal conservation, marine conservation, ocean conservation
    Date: 2012–08
  15. By: Robin Burgess; Matthew Hansen; Benjamin Olken; Peter Potapov; Stefanie Sieber;
    Abstract: Tropical deforestation accounts for almost one-…fifth of greenhouse gas emissions worldwide and threatens the world’s most diverse ecosystems. The prevalence of illegal forest extraction in the tropics suggests that understanding the incentives of local bureaucrats and politicians who enforce forest policy may be critical to combating tropical deforestation. We …find support for this thesis using a novel satellite-based dataset that tracks annual changes in forest cover across eight years of institutional change in post-Soeharto Indonesia. Increases in the numbers of political jurisdictions are associated with increased deforestation and with lower prices in local wood markets, consistent with a model of Cournot competition between jurisdictions. We also show that illegal logging and rents from unevenly distributed oil and gas revenues are short run substitutes, but this effect disappears over time as political turnover occurs. The results illustrate how incentives faced by local government officials affect deforestation,and provide an example of how standard economic theories can explain illegal behavior.
    Keywords: political economy, corruption, deforestation, Cournot competition, satellite imagery, environmental monitoring, illegal logging, climate change, biodiversity
    JEL: D73 L73
    Date: 2012–04

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