nep-agr New Economics Papers
on Agricultural Economics
Issue of 2013‒09‒26
twenty-six papers chosen by
Angelo Zago
University of Verona

  1. Volatility in the international food markets: implications for global agricultural supply and for market and price policy By Haile, Mekbib Gebretsadik; Kalkhul, Matthias
  2. Analysis of food prices in Uzbekistan (2002-2010) By Clement, Yadira Mori; Bhaduri, Anik; Djanibekov, Nodir
  3. Land Access and Youth Livelihood Opportunities in Southern Ethiopia By Holden, Stein; Bezu, Sosina
  4. Speculation, Responsible Investment and (Self-)Regulation in Agricultural Commodity Markets By Kalkuhl, Matthias; von Braun, Joachim
  5. Reducing the impact of Sclerotinia disease by determining optimum crop rotations using dynamic programming By Vosough Ahmadi, Bouda; Burnett, Fiona J; Young, Caroline S; McQuilken, Mark P; Stott, Alistair W
  6. Coffee Innovation Systems in Ethiopia and Rwanda By Tensay, Teferi Mequaninte; Müller, Ulrike
  7. The Green Revolution: The Untold Process of its Success By Banerjee, Rupsha
  8. How Consumer Price Subsidies affect Nutrition By Neeraj Kaushal; Felix Muchomba
  9. How Responsive to Prices is the Supply of Milk in Malawi? By Revoredo-Giha, Cesar; Arakelyan, Irina; Chalmers, Neil; Chitika, Rollins
  10. Food Price Spikes, Price Insulation, and Poverty By Anderson, Kym; Ivanic, Maros; Martin, Will
  11. Future Patterns of U.S. Grains, Biofuels, and Livestock and Poultry Feeding By Wisner, Robert; Anderson, David; Plain, Ronald; Hofstrand, Don; O'Brien, Daniel
  12. Changing Price Dynamics in Agricultural Commodity Markets By Filler, Günther; Volkenand, Steffen; Odening, Martin
  13. The Caloric Costs of Culture: Evidence from Indian Migrants By Atkin, David
  14. Trading off Use Restrictions and Benefit-Sharing for Genetic Materials for Food and Agriculture with an Emphasis on Upfront Payments By Seyoum, Aseffa; Welch, Eric
  15. Social Protection and Food Security in Sub-Saharan Africa: An Evaluation of Cash Transfer Programmes By d'Agostino, Giorgio; Pieroni, Luca; Scarlato, Margherita
  16. Does the risk attitude influence the farmers' willingness to participate in agri-environmental measures? – A normative approach to evaluate ecosystem services By Dörschner, Till; Musshoff, Oliver
  17. Innovations and Knowledge Transfer for the Food Supply Chain Sustainability: Challenges in the Czech Dairy Industry By Ratinger, Tomas; Boskova, Iveta
  18. Economic Cooperation Despite of Political Conflict: The Role of Social Embeddedness in Israeli-Palestinian Food Trade By Merkle, Geesche Marie; Ihle, Rico; Liebe, Ulf
  19. The role of consumers in the transition towards sustainability. The case of food supply By Filippo Randelli
  20. World Food Prices, the Terms of Trade-Real Exchange Rate Nexus, and Monetary Policy By Luis Catão; Roberto Chang
  21. Indirect Land Use Changes (ILUC): The Seen and the Unseen By Pierre Garello; Pierre Bentata
  22. Intensivising appropriate malaria treatment-seeking behaviour with price subsidies By Schultz Hansen, Kistian; Hjernø Lesner, Tine; Østerdal, Lars Peter
  23. Tribe or title? Ethnic enclaves and the demand for formal land tenure in a Tanzanian slum By Matthew Collin
  24. Beyond inducement in climate change: Does environmental performance spur environmental technologies? By Claudia Ghisetti; Francesco Quatraro
  25. Technology Adoption and Energy Efficiency in Irrigation: First Results from a Coordination Game in Andhra Pradesh, India By Müller, Malte; Rommel, Jens
  26. Using Field Experiments in Environmental and Resource Economics By John A. List; Michael K. Price

  1. By: Haile, Mekbib Gebretsadik; Kalkhul, Matthias
    Abstract: Agricultural countries usually produce multiple crops, but a particular area of land is allocated to the production of a certain crop. Understanding how producers make decision to allot acreage among crops and how decisions about land use are affected by changes in prices and their volatility is fundamental for both policy design and for estimation models of the behavior of agricultural producers. The profitability of a land allocated to a certain crop is affected by the volatility of the crop’s price that in turn affects the acreage allocation decision of the producer. To address this, the present paper estimates global acreage response equations for major agricultural commodities (wheat, maize, soybeans and rice) using two related databases: globally aggregated time series and cross-country panel databases. The paper addresses the debate of agricultural market regulation from the perspective of agricultural producers. The findings of this study reveal that, while higher output prices are incentives to improvements in the global crop supply, output price volatility, on the other hand, discourages agricultural investment in terms of cropland expansion. Depending on respective crop, short-run acreage elasticities range between 0.05 and 0.25 whereas price volatility tends to reduce acreage response of all crops except of soybeans. Thus, price volatility management tools, which could include market regulation but also other market based tools like futures contracts or contract farming, need to be customized to specific crops and countries.
    Keywords: Agricultural and Food Policy, Land Economics/Use, Risk and Uncertainty, O11, O13, Q11, Q13, Q18, Q24,
    Date: 2013
  2. By: Clement, Yadira Mori; Bhaduri, Anik; Djanibekov, Nodir
    Abstract: This study identifies the main determinants of food price fluctuations in Uzbekistan with a focus on the Khorezm region. We investigate the price behavior of ten agricultural commodities using the weekly data collected from local markets in the Khorezm region during 2002-2010. For the analysis, we used Autoregressive integrated moving average (ARIMA) models with exogenous variables such as water inflow, oil prices and international prices of selected commodities imported to Uzbekistan such as rice and wheat, and market exchange rate. The results show two general patterns of agricultural price fluctuations...
    Keywords: Price analysis, ARIMA models with exogenous variables, Price volatility, World-price transmission, Agricultural and Food Policy, Demand and Price Analysis,
    Date: 2013
  3. By: Holden, Stein (Centre for Land Tenure Studies, Norwegian University of Life Sciences); Bezu, Sosina (Centre for Land Tenure Studies, Norwegian University of Life Sciences)
    Abstract: This study aims to examine current land access and youth livelihood opportunities in Southern Ethiopia. Access to agricultural land is a constitutional right for rural residents of Ethiopia. We used survey data from the relatively land abundant districts of Oromia Region and from the land scarce districts of Southern Nations, Nationalities and Peoples’ (SNNP) Region. We found that youth in the rural south have limited potential to obtain agricultural land that can be a basis for viable livelihood. The law prohibits the purchase and sale of land in Ethiopia. We found that land access through allocation from authorities is virtually nonexistent while land that can be obtained from parents through inheritance or gift is too small to establish a meaningful livelihood. The land rental market has restrictions, including on the number of years land can be rented out. Perhaps as a result of limited land access, the youth have turned their back on agriculture. Our study shows that only nine percent of youth in these rural areas plan to pursue farming. The majority are planning non-agricultural livelihoods. We also found a significant rural -urban migration among the youth and especially in areas with severe agricultural land scarcity. Our econometric analyses show that youth from families with larger land holding are less likely to choose non-agricultural livelihood as well as less likely to migrate to urban areas. We suggest here some measures to improve rural livelihood such as creation of non-farm employment opportunities and improvement of land rental markets. We also argue that as a certain level of rural-urban migration is unavoidable, investigating youth migration is essential to design policies that help the migrating youth as well as the host communities.
    Keywords: Youth unemployment; youth livelihood; rural livelihood; migration; Ethiopia
    JEL: J13 Q15 R23
    Date: 2013–09–16
  4. By: Kalkuhl, Matthias; von Braun, Joachim
    Abstract: This poster discusses how different channels of speculation and affect food security in developing countries positively and negatively. As an overall assessment of the different trade-offs does not exist so far, we present a conceptual framework and some of its components to detect global price dynamics that threaten food security in developing countries. We further explore applications of such an information and early warning system in the realm of responsible investment practices and domestic or international relief systems.
    Keywords: Food price volatility, speculation, food security, regulation, liquidity, Agricultural and Food Policy, Financial Economics, Food Consumption/Nutrition/Food Safety,
    Date: 2013
  5. By: Vosough Ahmadi, Bouda; Burnett, Fiona J; Young, Caroline S; McQuilken, Mark P; Stott, Alistair W
    Abstract: Sclerotinia rot is a disease caused by the fungus Sclerotinina sclerotiorum which affects a wide range of crops and causes major yield and economic losses. Crop rotation is an important strategy for minimising losses. A dynamic programming (DP) model was developed to study the trade-offs between state of the land, severity of sclerotinia and financial impacts as a result of different cropping decisions. Results showed that rotation and treatment against sclerotinia was financially justified yet permitted intensive yet sustainable production of susceptible food crops in the long-run. Allocation of even a small proportion of cropping decisions to break crops coupled with treatments in the rotation mitigated long-term build-up of sclerotia in land. However in the short-run, high proportions and high frequencies of cropping decisions need to be either allocated to break crops or treated-susceptible crops in order to avoid the disease and to generate profit. Results showed that DP methodology provides a useful framework to explore the trade-offs between crop rotation and growing high value susceptible crops in the long- and short-term in relation to plant diseases in arable agriculture that are at the heart of sustainable food production and land use.
    Keywords: sclerotinia, crop rotation, dynamic programming, optimisation, agriculture, Crop Production/Industries, Farm Management,
    Date: 2013
  6. By: Tensay, Teferi Mequaninte; Müller, Ulrike
    Abstract: We use Social Network Analysis (SNA) to investigate the networking and knowledge management in the coffee value chain in Ethiopian and Rwanda and its applicability to the agricultural innovation system (AIS). The AIS aims at putting farmers at the center of the knowledge management and innovation system. Results of the SNA show that farmers from both Ethiopia and Rwanda are not at the center of the innovation system. In the Ethiopian coffee value chain, cooperatives are at the center of the knowledge management and innovation system. In Rwanda, NGOs play a central role in the knowledge management...
    Keywords: Networks, Knowledge management, Innovations, Ethiopia, Rwanda, Agricultural and Food Policy,
    Date: 2013
  7. By: Banerjee, Rupsha
    Abstract: Technology and society share a close relationship, as the adoption of new technologies has consequences across value systems and institutions in society. Historically, the emergence of agriculture and subsequent technologies played an important role in shaping social relations. This paper examines the Green Revolution that took place in India during the late 1960s and 70s from the perspectives offered by different development paradigms of technical change in developing countries. The high yielding variety seeds of wheat and rice that were then introduced significantly enhanced domestic food production, which was far from adequate after independence...
    Keywords: Green Revolution, India, C. Subramaniam, development paradigms, Agricultural and Food Policy,
    Date: 2013
  8. By: Neeraj Kaushal; Felix Muchomba
    Abstract: We study the effect on nutrition of an exogenous increase in food price subsidy from a targeted subsidy program in India. Households with incomes below the federal poverty threshold were issued ration cards to buy wheat and rice at half the market price. We use probability of ration card ownership as an instrumental variable to predict household food price subsidy. Estimates suggest that the predicted price subsidy had a negligible to negative effect on calorie intake; it increased calorie intake from wheat and rice, but lowered calorie intake from coarse grains that are less expensive substitutes of wheat and rice, but have fewer non-nutritional attributes (such as taste).
    JEL: I10 I32 I38
    Date: 2013–09
  9. By: Revoredo-Giha, Cesar; Arakelyan, Irina; Chalmers, Neil; Chitika, Rollins
    Abstract: Dairy is a key investment sector for the Government of Malawi. Advocacy institutions operating in the country have successfully lobbied for increasing the duty applied for powder milk, with the aim of improving the price received by farmers. It should be noted that whilst an increase of the price paid to farmers would rise their revenues (assuming the same amount of milk delivery), it might also bring additional blessings, in the sense that if farmers respond to prices, they may rise their revenues beyond the increase in prices, and furthermore, they would expand their delivery of milk to processors offsetting the imports of powder milk and reducing their idle capacity in factories. Hence, the purpose of this paper is to measure the responsiveness of the deliveries of milk at the milk bulking groups to prices paid to farmers (i.e., the elasticity of supply faced by processors). This is done using a unique dataset that comprises information by milk bulking group from January 2009 to February 2013. The results indicate that the supply of milk is price responsive. The price elasticity in the short term is equal to 0.6 and in the long term is 1.44. This indicates that farmers’ revenues not only benefit from an increase in the price of milk but also from the increase in the quantity produced. Furthermore, it indicates the possibility that domestic producers could offset imports of milk powder by processors, although answer to this requires further research.
    Keywords: Milk supply, autoregressive distributed lags, panel data., Food Consumption/Nutrition/Food Safety, International Relations/Trade,
    Date: 2013–07–09
  10. By: Anderson, Kym; Ivanic, Maros; Martin, Will
    Abstract: This paper has two purposes. It first considers the impact on world food prices of the changes in restrictions on trade in staple foods during the 2008 world food price crisis. Those changes—reductions in import protection or increases in export restraints—were meant to partially insulate domestic markets from the spike in international prices. We find that this insulation added substantially to the spike in international prices for rice, wheat, maize and oilseeds. As a result, while domestic prices rose less than they would have without insulation in some developing countries, in many other countries they rose more than in the absence of such insulation. The paper’s second purpose it to estimate the combined impact of such insulating behavior on poverty in various developing countries and globally. We find that the actual poverty-reducing impact of insulation is much less than its apparent impact, and that its net effect was to increase global poverty in 2008 by 8 million, although this increase was not significantly different from zero. Since there are domestic policy instruments such as conditional cash transfers that could now provide social protection for the poor far more efficiently and equitably than variations in border restrictions, we suggest it is time to seek a multilateral agreement to desist from changing restrictions on trade when international food prices spike.
    Keywords: Commodity price stabilization; Domestic market insulation; International price transmission; Loss aversion
    JEL: F14 O24 Q17 Q18
    Date: 2013–07
  11. By: Wisner, Robert; Anderson, David; Plain, Ronald; Hofstrand, Don; O'Brien, Daniel
    Abstract: A project financed by the Institute for Feed Education & Research (IFEEDER) on behalf of the American Feed Industry Association (AFIA) and The Council on Food, Agricultural and Resource Economics (C-FARE)
    Keywords: Biofuels, ethanol, distillers’ grain, pork, beef, broilers, dairy products, livestock product exports, Crop Production/Industries, Livestock Production/Industries, Resource /Energy Economics and Policy,
    Date: 2012–06
  12. By: Filler, Günther; Volkenand, Steffen; Odening, Martin
    Abstract: We analyze the speed of mean reversion (k) in the convenience yield and the spot price volatility for 7 US commodities between 1989-2012. In the hog market k is large, soybeans exhibit the lowest values. While for 5 of 7 commodities κ is lower in the more recent period (2005-2012) than in the pre energy period, soybeans and copper show the opposite behavior. A decreasing speed of k implies that the growth rate of the futures prices rises and thus the gap between the nearest and the farthest maturities increases. The estimated spot price volatilities increased for agricultural commodities.
    Keywords: Agricultural commodity markets, Price dynamics, Term structure models, Mean reversion, Demand and Price Analysis, Risk and Uncertainty,
    Date: 2013
  13. By: Atkin, David
    Abstract: Anthropologists have long documented substantial and persistent differences across social groups in the preferences and taboos for particular foods. One natural question to ask is whether such food cultures matter in an economic sense. In particular, can culture constrain caloric intake and contribute to malnutrition? To answer this question, I first document that inter-state migrants within India consume fewer calories per Rupee of food expenditure compared to their non-migrant neighbors, even for households with very low caloric intake. I then form a chain of evidence in support of an explanation based on culture: that migrants make nutritionally-suboptimal food choices due to cultural preferences for the traditional foods of their origin states. First, I focus on the preferences themselves and document that migrants bring their origin-state food preferences with them when they migrate. Second, I link together the findings on caloric intake and preferences by showing that the gap in caloric intake between locals and migrants is related to the suitability and intensity of the migrants' origin-state food preferences: the most adversely affected migrants (households in which both husband and wife migrated to a village where their origin-state preferences are unsuited to the local price vector) would consume 7 percent more calories if they possessed the same preferences as their neighbors.
    Keywords: Culture; India; Migrants; Nutrition
    JEL: D12 I10 O10 Z10
    Date: 2013–07
  14. By: Seyoum, Aseffa; Welch, Eric
    Abstract: This study investigates the tradeoffs that providers of genetic resources make between constructing a benefits arrangement and establishing use restrictions. The analysis makes use of project level data collected from university and government researchers in the US. Results show that when transfers require upfront payments recipients are not expected to contribute long-term monetary or non-monetary benefits, and nor are there restrictions on the transferred material. When providers seek information from project results they tend not to request upfront payments for providing genetic materials. Researchers tend to acquire genetic material at cost plus an additional fee when it comes from foreign counties and companies. The paper concludes by highlighting the roles that upfront payments and reduced restriction can play to improve exchange and utilization of genetic materials for public research.
    Keywords: Upfront payment, benefit sharing, genetic resource, material exchange, use restriction, Agricultural and Food Policy,
    Date: 2013
  15. By: d'Agostino, Giorgio; Pieroni, Luca; Scarlato, Margherita
    Abstract: This paper evaluates the effects of cash transfer (CT) programmes introduced during the 1990s and 2000s on food security in a sample of sub-Saharan African countries. We apply the synthetic control method to compare changes in the post-intervention food insecurity trajectories of economies affected by CT programmes relative to their unaffected counterparts. The results suggest that CT programmes exert differential effects on the prevalence of undernourishment. Although the estimates in the upper-middle income countries in our sample show mixed effects for the application of CT programmes on food insecurity, these effects appear to be important in low-income and fragile sub-Saharan countries. Robustness analysis via placebo experiments confirms the soundness of our results, and their implications for policymakers are discussed.
    Keywords: Sub-Saharan Africa, food security, social protection
    JEL: O13 Q1 Q18
    Date: 2013–09–05
  16. By: Dörschner, Till; Musshoff, Oliver
    Abstract: Agri-environmental measures are often not as accepted among farmers as expected. The present study investigates whether changes in income risks and the individual risk attitudes of farmers may constitute an explanatory approach for the low acceptance of the measures. For this purpose, a normative model is developed that calculates the premia claimed by the farmers for adopting environmental measures under the consideration of income risks and different risk attitudes. We apply this model to environmental measures aiming at an increase of the faunistic diversity of species and show that changes in income risks and the decision makers’ risk attitudes can significantly influence farmers’ minimum compensation claims for the participation in agri-environmental measures.
    Keywords: agri-environmental measures, income risks, minimum compensation claim, premium for ecosystem services, risk attitudes, Environmental Economics and Policy, Risk and Uncertainty,
    Date: 2013
  17. By: Ratinger, Tomas; Boskova, Iveta
    Abstract: A mobilisation of research, knowledge transfer and innovation to deal with the current challenges as raising world food demand while protecting natural resources is a priority area of the EU. The effective knowledge transfer and innovation activities in the agri-food supply chain may push all producers in the vertical to improve their competitiveness while saving resources. In the paper we examine the current level of innovation activities and knowledge transfer in milk processing industry in the Czech Republic, with a particular focus on the collaboration of firms with R&D organisations and other important agents, in order to assess the potential for enhancing sustainable dairy production. Most of the interviewed milk processors confirmed that sustainability objective did not rank high within firms’ strategies while it showed a great potential for innovations. It is apparent from the conducted interviews with stakeholders as well as from the statistics that the level of cooperation for innovations is rather low among the Czech food and particularly dairy processors. The low cooperation level concerns not only research institution but also other agents including farmers. This is in contrast to considering cost as a hurdle for innovations. The lack of cooperation among producers can partly be accounted to property rights protection and the need to get advantage over the competition. The interviews and the statistics showed that companies with in-house R&D staff have higher absorption capacity and thus requirements concerning cooperation with research institutions and that these firms are not satisfied with what is offered in the country and seek support abroad. The current support programme increased the sector innovation activity, but at the same time used-up limited capacities of the national research base. Continuation of the support in the current way seems unsustainable.
    Keywords: Sectoral system of innovation, absorption capacity, dairy processing industry, Research and Development/Tech Change/Emerging Technologies,
    Date: 2013
  18. By: Merkle, Geesche Marie; Ihle, Rico; Liebe, Ulf
    Abstract: Against the background of the Middle East conflict we study the role of social embeddedness of economic actors belonging to both conflicting parties for their perceptions of transaction problems and capabilities to solve them. Our analysis is based on a quantitative survey among Israeli food wholesalers. We find vivid economic relationships between Israeli and Palestinian traders, no particular problems occur. Continuity of business relations points to a strong role of social embeddedness. Arabic is frequently used in communication referring to an important role of institutional embeddedness. Various trade impediments due to the conflict do not impact Israeli but Palestinian traders.
    Keywords: Food trade, violent conflict, Social embeddedness, quantitative survey, Israel, Palestinian territories, Cooperation, Food Security and Poverty, International Relations/Trade,
    Date: 2013
  19. By: Filippo Randelli (Università degli Studi di Firenze)
    Abstract: The so called “socio-technical transitions” is driven by actors such as firms and industries, policy makers and politicians, consumers, civil society, engineers and researchers. This paper addresses the role of consumers in the transition process and their interaction with the established socio-technical (ST) regime. Then the questions that it follows to answer are: do the consumers can address for changes in the established regime? Which are the mechanisms hindering a transition driven by consumers? Is there a consumer innovation life cycle? The emergence of new designs in the established food supply ST regime will be used as an empirical test case. The conceptual framework enriches the multi-level perspective with insights from organization studies, both in industrial and social organization research field. The growing dissatisfaction for the established food supply, dominated by the duopoly supermarket-global food supplier, has driven few pioneers to search for new designs. To point out this innovative process of “bottom-up” innovation into the food supply regime, a case study is presented. The case of Italy illustrates several important consumer-related aspects of innovations and their influence on the established regime. In order to disclose the mechanisms moving forward the process of change in the food supply network, a number of questionnaires was submitted to informal network of consumers. Furthermore, in order to trace how consumers innovation in the food supply may evolve over time we propose a model which consists of four different phases drawn on the answers to the fifth question in the questionnaire (Past trajectories and future development).
    Keywords: food supply, consumer innovation, multi-level perspective, informal local networks
    JEL: D10 O31 Q18
    Date: 2013
  20. By: Luis Catão; Roberto Chang
    Abstract: How should monetary policy respond to large fluctuations in world food prices? We study this question in an open economy model in which imported food has a larger weight in domestic consumption than abroad and international risk sharing can be imperfect. A key novelty is that the real exchange rate and the terms of trade can move in opposite directions in response to world food price shocks. This exacerbates the policy trade-off between stabilizing output prices vis a vis the real exchange rate, to an extent that depends on risk sharing and the price elasticity of exports. Under perfect risk sharing, targeting the headline CPI welfare-dominates targeting the PPI if the variance of food price shocks is not too small and the export price elasticity is realistically high. In such a case, however, targeting forecast CPI is a superior choice. With incomplete risk sharing, PPI targeting is clearly a winner.
    Keywords: Commodity price fluctuations;External shocks;Producer price indexes;Terms of trade;Exchange rate appreciation;Monetary policy;Economic models;Commodity Price Shocks, Inflation Targeting, Taylor rules, Incomplete Markets
    Date: 2013–05–17
  21. By: Pierre Garello (CERGAM, FEG, Aix-Marseille Université); Pierre Bentata (CERGAM-CAE, Aix-Marseille Université)
    Abstract: The paper analyzes a policy proposition to take into account indirect land use changes in the evaluation of GHG emissions by biofuel industry. Based on an extensive survey of scientific literature onILUC, it is argued that, due to the absence of a satisfactory scientific evaluation of ILUC, the proposition should be rejected for it will necessarily translate into arbitrary decisions and push an already struggling biofuel industry into bankruptcy. The study also provides afirst approximation of the cost of implementing ILUC regulation in terms of employment and subsidies. Also, a different orientation for a policy towards cleaner and renewable energy is outlined that would be based on a realistic account of current scientific and technological knowledge.
    Keywords: Indirect land Use Change, global public goods, GHGemissions, EU energy policy
    JEL: Q42 Q48 Q51 Q56
    Date: 2013–08
  22. By: Schultz Hansen, Kistian (Department of Global Health and Development); Hjernø Lesner, Tine (COHERE, Department of Budiness and Economics); Østerdal, Lars Peter (COHERE, Department of Business and Economics)
    Abstract: One of the most serious problems in the fight against malaria, especially in Africa, is the fact that many individuals suffering from malaria do not have easy access to effective antimalarials while at the same time a large proportion of people receiving antimalarials do not suffer from malaria. In order to improve access, a global price subsidy of 95% has been proposed for the most effective antimalarial, artemisininbased combination therapy (ACT). The objective of this proposal is to lower the consumer price on effective malaria medicine to increase access for, in particular, poor consumers. However, treatment of patients not suffering from malaria with antimalarials including ACTs has been proven widespread and a subsidy is likely to increase this overtreatment. This means waste of resources and will result in inflating the subsidy funds required. In addition, as has happened with older types of malaria medicine, treating nonmalarial fevers with malaria medicine may increase the risk of artemisinin resistance development. Diagnostic tests for malaria may have the potential for reducing overtreatment, but tests are expensive for the typical malaria treatmentseeking individual. In order to both increase access and reduce overtreatment we propose a subsidy on rapid diagnostic tests (RDTs) together with the ACT subsidy. The main objective of the paper is to investigate the optimal combination of subsidies that incentivises individuals suspecting themselves to have malaria to always test before buying an effective drug. We present a model that describes the health seeking behaviour of a representative individual using an expected utility framework. Based on numerical simulations of our model we find that a price reduction on RDTs is necessary to incentivise testing while at the same time, the subsidy on ACT can be lower than the proposed 95% without compromising access. The leastcost policy of the health policy maker is to subsidise both ACT and RDT, redirecting some of the subsidy money from ACT to RDT.
    Keywords: Health and economic development; public health; medical subsidy programmes; malaria; drug resistance
    JEL: H51 I15 O15
    Date: 2013–09–10
  23. By: Matthew Collin
    Abstract: This paper examines the relationship between ethnic heterogeneity and the demand for formal land tenure in urban Tanzania. Using a unique census of two highly-fractionalized unplanned settlements in Dar es Salaam, I show that households located near coethnics are significantly less likely to purchase a limited form of land tenure recently offered by the government. I attempt to address one of the chief concerns - endogenous sorting of households - by conditioning on a household’s choice of coethnics neighbors upon arrival in the neighborhood. I also find that coethnic residence predicts lower levels of perceived expropriation risk, but not perceived access to credit nor contribution to local public goods. These results suggest that close-knit ethnic groups may be less likely to accept state-provided goods due to their ability to generate reasonable substitutes, in this case protection from expropriation. The results are robust to different definitions of coethnicity and spatial cut-offs, controls for family ties and religious similarity as well as spatial fixed effects. Finally, the main result is confirmed using a large-scale administrative data-set covering over 20,000 land parcels in the city, exploiting ethnically-unique last names to predict tribal affiliation.
    Keywords: Ethnicity, Land tenure, Tanzania, Unplanned settlements
    JEL: J15 Q15 R23
    Date: 2013
  24. By: Claudia Ghisetti (Département des sciences économiques - Università di Bologna); Francesco Quatraro (GREDEG - Groupe de Recherche en Droit, Economie et Gestion - CNRS : UMR7321 - Université Nice Sophia Antipolis [UNS])
    Abstract: This paper contributes to the debate on the inducement of environmental innovations by analysing the extent to which endogenous inducement mechanisms spur the generation of greener technologies in contexts characterized by weak exogenous inducement pressures. In the presence of a fragile environmental regulatory framework, inducement can indeed be endogenous and environmental innovations may be spurred by firms' reactions to their direct or related environmental performance. Cross-sector analysis focuses on a panel of Italian regions, over the time span 2003-2007, and is conducted by implementing zero-inflated regression models for count data variables. The empirical results suggest that in a context characterized by a weak regulatory framework, such as the Italian one, environmental performance has significant and complementary within- and between-sector effects on the generation of green technologies.
    Keywords: Green technologies; Environmental Performance; Regional NAMEA; Technological innovation; Knowledge production function
    Date: 2013–09–09
  25. By: Müller, Malte; Rommel, Jens
    Abstract: Farmers’ technology adoption in electric irrigation has recently been analyzed as a coordination problem. To study how the Pareto-inferior equilibrium, farmers are trapped in, can be overcome we have developed a framed field experiment. Leadership and group size are varied in a full factorial experimental design. Initial results show only minor treatment effects. Further analysis is necessary to account for socio-demographic heterogeneity.
    Keywords: Coordination Game, Energy Efficiency, India, Irrigation, Technology Adoption, Community/Rural/Urban Development, Institutional and Behavioral Economics, Research Methods/ Statistical Methods,
    Date: 2013
  26. By: John A. List; Michael K. Price
    Abstract: This study showcases the usefulness of field experiments to the study of environmental and resource economics. Our focus pertains to work related to field experiments in the area of ‘behavioral’ environmental and resource economics. Within this rubric, we discuss research in two areas: those that inform i) benefit cost analysis and ii) conservation of resources. Within each realm, we show how field experiments have been able to test the relevant theories, provide important parameters to construct new theories, and guide policymakers. We conclude with thoughts on how field experiments can be used to deepen our understanding of important areas within environmental and resource economics.
    JEL: C9 C93 Q5
    Date: 2013–08

This nep-agr issue is ©2013 by Angelo Zago. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.