New Economics Papers
on Agricultural Economics
Issue of 2013‒09‒28
eighteen papers chosen by

  1. Identifying Factor Productivity by Dynamic Panel Data and Control Function Approaches: A Comparative Evaluation for EU Agriculture By Petrick, Martin; Kloss, Mathias
  2. Where is the Backward Peasant? Regional Crop Yields on Common and Private Land in Russia 1883-1913 By Michael Kopsidis; Katja Bruisch; Daniel W. Bromley
  3. Effectiveness of hedging within the high price volatility context By Revoredo-Giha, Cesar; Zuppiroli, Marco
  4. Technical Compendium: Descriptive Agricultural Statistics and Analysis for Zambia By Tembo, Solomon; Sitko, Nicholas
  5. Analysis of Consumer Preferences and Willingness-To-Pay for Organic Food Products in Germany By Illichmann, Rebecca; Abdulai, Awudu
  6. Dryland Pastoral Systems in Transition: What are the Options for Institutional Change in Uzbekistan? By Shaumarov, Makhmud; Birner, Regina
  7. Agri-Environmental Policy Effects at Producer Level - Identification and Measurement By Sauer, Johannes; Walsh, John; Zilberman, David
  8. Meat consumption patterns in Vietnam: effects of household characteristics on pork and poultry consumption By Nguyen, Van Phuong; Mergenthaler, Marcus
  9. Neighbours and Extension Agents in Ethiopia: Who matters more for technology diffusion? By Krishnan, Pramila; Patnam, Manasa
  10. Commodity futures and market efficiency By Ladislav Kristoufek; Miloslav Vosvrda
  11. Transmission of World Food Prices to Domestic Market: The Ethiopian Case By Kelbore, Zerihun Getachew
  12. Measuring Political Information Rents: Evidence from the European Agricultural Reform By Grüner, Hans Peter; Müller, Daniel
  13. Spatial issues on a hedonic estimation of rents in Brussels By PHOLO BALA, Alain; PEETERS, Dominique; THOMAS, Isabelle
  14. Empirical Analysis of Biomass and Energy Price Volatility By Kristöfel, Christa; Morawetz, Ulrich; Schmid, Erwin
  15. Export Quality in Developing Countries By Christian Henn; Chris Papageorgiou; Nicola Spatafora
  16. Farmers' willingness to sell straw for material and energy use in Bavaria By Gaus, Cord-Christian; Menrad, Klaus; Decker, Thomas
  17. Ranking Distributions of Environmental Outcomes Across Population Groups By Glenn Sheriff; Kelly B. Maguire
  18. What do Environmental and Resource Economists Think? Results from a Survey of AERE Members By Timothy C. Haab; John C. Whitehead

  1. By: Petrick, Martin; Kloss, Mathias
    Abstract: The classical problem of agricultural productivity measurement has regained interest due to recent price hikes in world food markets. At the same time, there is a new methodological debate on the appropriate identification strategies for addressing endogeneity and collinearity problems in production function estimation. We examine the plausibility of alternative identification strategies for the case of agriculture and test two related, innovative estimators using farm-level panel datasets from seven EU countries. The control function and dynamic panel approaches provide attractive conceptual improvements over the received ‘within’ and duality models. Even so, empirical implementation of the conceptual sophistications built in these estimators does not always live up to expectations. This is particularly true for the dynamic panel estimator, which mostly failed to identify reasonable elasticities for the (quasi-) fixed factors. Less demanding proxy approaches represent an interesting alternative for agricultural applications. In our EU sample, we find very low shadow prices for labour, land and fixed capital across countries.The production elasticity of materials is high, so that improving the availability of working capital is the most promising way to increase agricultural productivity.
    Keywords: Agricultural factor productivity, production function estimation, EU, Farm Accountancy Data Network, Production Economics, Productivity Analysis,
    Date: 2013
  2. By: Michael Kopsidis (Leibniz Institute of Agricultural Development in Central and Eastern Europe (IAMO)); Katja Bruisch (German Historical Institute Moscow (DHI Moskau)); Daniel W. Bromley (University of Wisconsin-Madison)
    Abstract: This paper deals with agricultural dynamics in late-Imperial Russia. Based upon a comprehensive micro-level data set on annual yields between 1883 and 1913, we provide insight into regional differences of agricultural growth and the development prospects of Russian agriculture before WWI. Making use of the fact that— unique in Europe— contemporary Russian statistics distinguished between “privately owned” and mostly communally governed “peasant” land, we are able to test the implications of different landtenure systems for agricultural growth. In a broader sense we will challenge the stereotype of the “backward” peasant and the common narrative of Russia as an exception to the pan-European picture of economic development during the era of industrialization.
    Keywords: Russia, land productivity, peasant communal agriculture, land tenure
    JEL: N53 O13 Q15
    Date: 2013–09
  3. By: Revoredo-Giha, Cesar; Zuppiroli, Marco
    Abstract: The instability of prices and the hypothesis that speculative behaviour was one of its sources has brought renewed interest in the futures markets. In this paper, we concentrate on the European wheat futures markets (feed and milling) and the CBOT’s wheat contract as a comparison. The purpose of the paper is to study whether those markets still allow substitution price risk for basis risk. This implicitly is a test of whether the increasing presence of speculation in futures market have made them divorced from the physical markets, and therefore, not useful for commercial entities. We study two aspects: efficiency and hedging effectiveness and our results indicate that there are still a good connection between physical and futures markets, and therefore, hedging can still play an important role protecting commodity handlers against price volatility.
    Keywords: Futures prices, commodity prices, volatility, wheat, Agribusiness, Agricultural and Food Policy, Crop Production/Industries, Demand and Price Analysis, Financial Economics, Risk and Uncertainty,
    Date: 2012–09
  4. By: Tembo, Solomon; Sitko, Nicholas
    Abstract: This technical compendium was developed to serve as a reference document for development organizations, researchers, government officials, and cooperating partners working in Zambia. It uses nationally representative survey data to provide descriptive trends and analysis relevant to the agricultural sector. It is also specifically targeted for organizations tasked with implementing programs associated with USAID’s Feed the Future (FtF) initiative. As such, a special section is dedicated to Eastern Province, with data disaggregation based on FtF requirements.
    Keywords: Agricultural and Food Policy,
    Date: 2013–08
  5. By: Illichmann, Rebecca; Abdulai, Awudu
    Abstract: This study employs a choice experiment approach to investigate consumers’ preferences and WTP for organic food products. We use mixed logit models to examine preference heterogeneity. The results revealed significant heterogeneity in preferences for organic apples, milk, and beef product attributes among consumers. The willingness-to-pay (WTP) results obtained from mixed logit indicate gender-specific differences for the examined products of this study. Female respondents have a higher WTP for apple attributes, while higher WTP values for milk and beef attributes are observed for male respondents.
    Keywords: Organic farming, choice experiment, preference heterogeneity, mixed logit, Consumer/Household Economics, Food Consumption/Nutrition/Food Safety,
    Date: 2013
  6. By: Shaumarov, Makhmud; Birner, Regina
    Abstract: Within the last two decades, 40% of rangelands in Uzbekistan have been taken out of use due to non-functioning water facilities and pasture degradation. A retrospective study of rangeland production system development in the former Soviet Union (FSU) shows that the pasture land was used more productively, socio-economic benefits were created in rural areas, and land degradation was effectively addressed. Considering that pasture lands are a common-pool resource, which – following the current discourse – might be best used by local communities, the question arises as to how the highly centralized Soviet system was able to achieve a very productive use. The historical analysis presented in this paper shows that this was achieved by means of (a) making intensive use of agricultural research on the one hand, and (b) setting-up an effective institutional structure, on the other. This paper aims at highlighting the role of agricultural research as well as institutional mechanism that allowed Soviets to manage common-pool resources productively, taking into account the political incentives to make such a system work. The paper also asks the question why lessons from the past were not derived to move the current transition reforms for the pastoral system in a direction that allows for a sustainable and productive use of this system. To better understand the current trends of change in dryland pastoral systems in a broader context of institutional reform, the current transition reforms and potential institutional options are discussed from a political economy perspective. Based on this approach, alternative options are derived for the further development of the rangeland production systems.
    Keywords: Agricultural research, Grounded Theory, Pastoral degradation, Political economy, Transition reforms in Uzbekistan, Environmental Economics and Policy, Institutional and Behavioral Economics, Political Economy,
    Date: 2013
  7. By: Sauer, Johannes; Walsh, John; Zilberman, David
    Abstract: This empirical study investigates the effects of different agri-environmental schemes on individual producer behaviour. We consider the effects on production intensity, performance and structure for a sample of UK cereal farms for the period 2000 to 2009 and use the policy examples of the Environmental Stewardship Scheme (ESS) and the Nitrate Vulnerable Zones (NVZ). The econometric methodology is based on a directional distance function framework as well as the application of matching estimators. We find that both schemes are effectively influencing production behaviour at individual farm level. However, agri-environmental schemes show only very minor effects on the technical and allocative efficiency of farms, hence, we can conclude that farms enrolled in agri-environmental schemes are efficiently adjusting their production decisions given the constraints by the respective scheme. Farms affected by these schemes indeed tend to become less specialised and more diversified with respect to their production structure. A voluntary type agri-environmental scheme seems to signficantly influence producer behaviour at a far higher scale than a non-voluntary agri-environmental scheme. The methodological novelty of this research lies in the use of a sound production theory based multi-output multi-input approach to disentangle measures for production performance and structure which are then used as indicators for the robust treatment effects’ analyses.
    Keywords: Agri-Environmental Policy, PES, Directional Distance Function, Matching Estimators, Environmental Economics and Policy, Production Economics, Productivity Analysis,
    Date: 2013
  8. By: Nguyen, Van Phuong; Mergenthaler, Marcus
    Abstract: This study relates social-demographic characteristics of Vietnamese households to their consumption of meat. Tobit models are estimated drawing on the latest Vietnamese Household Living Standard Survey in 2010 (VHLSS 2010). The analysis of demand for pork and poultry in Vietnamese households demonstrates that the meat demand in Vietnam is significantly affected by socio-economic and geographic factors.
    Keywords: Vietnam, meat consumption, household consumption, tobit model, VHLSS, Consumer/Household Economics, Food Consumption/Nutrition/Food Safety, Marketing,
    Date: 2013
  9. By: Krishnan, Pramila; Patnam, Manasa
    Abstract: The increased adoption of fertiliser and improved seeds are key to raising land productivity in Ethiopian agriculture. However, as in much of sub-Saharan Africa, the adoption and diffusion of such technologies has been slow. We use data from the Ethiopia between 1999-2009 to examine the role of learning from extension agents versus neighbours for both improved seeds and fertiliser. We use the structure of spatial networks of farmers and panel data to identify these influences and find that while the initial impact of extension agents was high, the effect wore off, in contrast to learning from neighbours.
    Keywords: diffusion; social learning; social networks
    JEL: C31 Q16
    Date: 2013–07
  10. By: Ladislav Kristoufek; Miloslav Vosvrda
    Abstract: We analyze the market efficiency of 25 commodity futures across various groups -- metals, energies, softs, grains and other agricultural commodities. To do so, we utilize recently proposed Efficiency Index to find that the most efficient of all the analyzed commodities is heating oil, closely followed by WTI crude oil, cotton, wheat and coffee. On the other end of the ranking, we detect live cattle and feeder cattle. The efficiency is also found to be characteristic for specific groups of commodities -- energy commodities being the most efficient and the other agricultural commodities (formed mainly of livestock) the least efficient groups. We also discuss contributions of the long-term memory, fractal dimension and approximate entropy to the total inefficiency. Last but not least, we come across the nonstandard relationship between the fractal dimension and Hurst exponent. For the analyzed dataset, the relationship between these two is positive meaning that local persistence (trending) is connected to global anti-persistence. We attribute this to specifics of commodity futures which might be predictable in a short term and locally but in a long term, they return to their fundamental price.
    Date: 2013–09
  11. By: Kelbore, Zerihun Getachew
    Abstract: This paper investigates the integration of the Ethiopian grain market to the world market; and within country grain markets integration. To this end, two cereal crop markets: wheat and maize, have been investigated. For maize the integration into the world market is analyzed using the US and SAFEX exchange markets as a world market; for wheat Paris and Chicago exchange markets are considered a wheat world market. The analysis has been conducted using a cointegration method: Johansen (1988) procedure. The results show that the Ethiopian grain market is integrated into the world market, albeit to the once geographically proximate to it. And further, we found that the elasticity of the price pass through between the world and domestic markets has appeared to be more than unitary when evaluated at the mean prices of the two food crops. The analysis of domestic market integration is conducted using principal component analysis (PCA). The result shows that both wheat and maize markets are fairly integrated. However, the results demonstrate that in wheat market, of the traditionally known deficit markets Mekelle has shown an improvement in integration as its mean prices and price variability appear to be in line with the central market, but the maize market result has preserved the deficit market status. In the other deficit market, Dire Dawa, the mean prices of wheat and maize appear to be higher and more volatile than the central market. The other most striking result is that despite huge infrastructural improvement markets further from the central market exhibit higher level of price volatility than markets within a 300km distance from the central market, Addis Ababa. It has also been observed that the price differential between the central market and other local markets has shown a declining trend over time, and found to be stationary. This implies that the markets are more likely to converge in the long run, provided the market infrastructure continues to develop so as to reduce market information asymmetry that we believe has contributed to differences in price differentials and price volatility across markets
    Keywords: world market, domestic market, Price transmission, market integration , cointegration, PCA
    JEL: F1 F15 F42 O55 Q17 Q18
    Date: 2013–03–06
  12. By: Grüner, Hans Peter; Müller, Daniel
    Abstract: This paper develops a method to estimate information rents of losers of a reform who receive a monetary compensation. Our method explicitly accounts for survey respondents' reluctance to reveal a willingness to accept which is smaller than the actual compensation. We apply our approach to the case of the 2005 European agricultural reform using uniquely gathered survey data from farmers in Lower Saxony, Germany. We find empirical indications for strategic misreporting. Correcting for these effects with a structural model, we find that information rents are in the order of up to 15 per cent of total compensation paid. Moreover, we show that the reform could not have been implemented distinctly cheaper by conditioning compensation schemes on observable factors.
    Keywords: European agricultural reform; information rents
    JEL: D70 D78 H20
    Date: 2013–04
  13. By: PHOLO BALA, Alain (Department of Economics and Econometrics, University of Johannesburg, South Africa); PEETERS, Dominique (Université catholique de Louvain, CORE, Belgium); THOMAS, Isabelle (Université catholique de Louvain, CORE, Belgium)
    Abstract: Using Belgian microdata, we assess the impact, on a hedonic regression, of the distortions arising from the choice of either a specific zoning system or the delineation of the study area. We also evaluate the biases that arise when spatial effects are not accounted for. Given that the dependent variable is interval-coded, controlling for spatial dependence in this context is challenging. We address this problem with two alternative strategies. Firstly, we use the Gibbs Sampling algorithm to estimate spatial econometric models which extends the interval regression model. A major drawback of this approach is that the implied estimation is proned to the endogeneity biases inherent to our hedonic regression model. To circumvent the endogeneity issues triggered by the first estimation strategy, we also use a two-stage estimation procedure with locational fixed effects. In all specifications, results are sensitive to the Modifiable Areal Unit Problem (MAUP) and to the choice of the delineation of the study area. Moreover, they confirm the existence of substantive spatial dependence. Conversely to the previous results with a negative elasticity for the percentage of the area covered by agriculture and a positive elasticity for the potential accessibility to jobs, the second approach implies opposite effects for those two variables. This indicates that dwellings close to agricultural areas and with a lower accessibility to the main employment centers are highly demanded and that endogeneity biases are not negligible.
    Keywords: MAUP, interval regression, spatial dependence, spatial heterogeneity, Brussels
    JEL: C21 C24 C25 C34 Q53 R21
    Date: 2013–07–23
  14. By: Kristöfel, Christa; Morawetz, Ulrich; Schmid, Erwin
    Abstract: The current debate on biomass price volatility mainly refers to increased market dynamics and integration as well as renewable energy policy intervention. Higher price volatility leads to additional costs that are often shared and transmitted along the supply chain to the final consumers. We empirically analyze whether or not price volatility of woody biomass commodities has increased in recent years. Results indicate that the price volatility of some woody biomass commodities has increased, but it is still lower than of fossil fuels.
    Keywords: Price volatility, woody biomass, energy market, Demand and Price Analysis, Resource /Energy Economics and Policy, Risk and Uncertainty,
    Date: 2013
  15. By: Christian Henn; Chris Papageorgiou; Nicola Spatafora
    Abstract: This paper develops new, far more extensive estimates of export quality, covering 178 countries and hundreds of products over 1962–2010. Quality upgrading is particularly rapid during the early stages of development, with quality convergence largely completed as a country reaches upper middle-income status. There is significant cross-country heterogeneity in quality growth rates. Within any given product line, quality converges both conditionally and unconditionally to the world frontier; increases in institutional quality and human capital are associated with faster quality upgrading. In turn, faster growth in quality is associated with more rapid output growth. The evidence suggests that quality upgrading is best encouraged through a broadly conducive domestic environment, rather than sector-specific policies. Diversification is important to create new upgrading opportunities.
    Keywords: Exports;Developing countries;Manufacturing sector;Agricultural commodities;Agricultural exports;Cross country analysis;Exports; Product Quality; Upgrading; Developing Countries.
    Date: 2013–05–15
  16. By: Gaus, Cord-Christian; Menrad, Klaus; Decker, Thomas
    Abstract: Decision-making behaviour, Farmers’ willingness to sell, Straw, Structural equation modeling, Bavaria
    Keywords: Agribusiness, Institutional and Behavioral Economics, Resource /Energy Economics and Policy,
    Date: 2013
  17. By: Glenn Sheriff; Kelly B. Maguire
    Abstract: This paper develops methods for evaluating distributional impacts of alternative environmental policies across demographic groups. The income inequality literature provides a natural methodological toolbox for comparing distributions of environmental outcomes. We show that the most commonly used inequality indexes, such as the Atkinson index, have theoretical properties that make them inappropriate for analyzing bads, like pollution, as opposed to goods, like income. We develop a transformation of the Atkinson index suitable for analyzing bad outcomes. We also show how the rarely used Kolm-Pollak index is particularly convenient for ranking distributions of both good and bad health and environmental outcomes. We demonstrate these methods in the context of emissions standards affecting indoor air quality.
    Keywords: environmental justice, distributional analysis, inequality indexes, Lorenz curves, benefit-cost analysis
    JEL: D61 D63 Q52 Q56
    Date: 2013–08
  18. By: Timothy C. Haab; John C. Whitehead
    Abstract: In this paper we present results from an opinion survey of Association of Environmental and Resource Economists members concerning issues ranging from basic market failure propositions to current policy questions to environmental behavior. The topical issues considered span the discipline including air and water pollution, sustainability, fishery, forestry and energy economics. We use entropy analysis to determine issues where there is consensus and multivariate analysis of the determinants of opinions. We find that AERE members reach consensus on a number of items of opinion and there are a number of items for which consensus is more difficult to reach. We find that agreement with items of opinion is influenced by noneconomic factors: concern about the environment and natural resources, political ideology, gender, the number of children in the household and United States residence. Key Words:
    Date: 2013

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