European Review of Agricultural Economics - Advance Access

Modelling the impact of the CAP Single Farm Payment on farm investment and output

Sckokai, P., Moro, D. — Thu, 05 Nov 2009 05:01:34 PST

This paper analyses the impact of the Common Agricultural Policy arable crop regime on farm investment and output, introducing explicitly farmers’ risk attitudes into a dynamic dual model of farm decision-making. Estimation and simulation results are based on a Farm Accounting Data Network sample of Italian arable farms. The main finding is that an increase in intervention price would significantly affect farm investment, mainly through reduced price volatility, while policy changes not affecting price uncertainty, like an increase in the Single Farm Payment, would have a much smaller impact.

Income Stabilization in European Agriculture: Design and Economic Impact of Risk Management Tools

Anton, J. — Tue, 03 Nov 2009 03:45:03 PST

An Introduction to the Structural Econometrics of Auction Data

Salant, D. — Tue, 03 Nov 2009 23:37:56 PST

Frontiers in Resource and Rural Economics: Human-Nature, Rural-Urban Interdependencies

Roberts, D. — Tue, 03 Nov 2009 03:44:43 PST

The Dragon and the Elephant: Agricultural and Rural Reforms in China and India

Rae, A. — Tue, 03 Nov 2009 03:44:28 PST

The Economics of Production (Second Edition)

Hess, S. — Thu, 29 Oct 2009 23:02:33 PDT

Fat Economics: Nutrition, Health, and Economic Policy

Nayga, R. M. — Thu, 29 Oct 2009 23:02:16 PDT

Modelling farm production decisions under an expenditure constraint

Kumbhakar, S. C., Bokusheva, R. — Mon, 19 Oct 2009 09:38:19 PDT

We use the indirect production function approach in the stochastic frontier framework to estimate separately the output losses due to the presence of a budget constraint and technical inefficiency. We develop a methodology for estimating the severity and testing the significance of the expenditure constraint at individual producer level. Our results, based on the farm data from three Russian regions from 1999 to 2003, show that the majority of the farms studied were expenditure-constrained during the study period. Expenditure constraints caused, on average, a potential output loss of 20 per cent. Output loss due to technical inefficiency, on average, is found to be around 13 per cent.

The optimal amount and allocation of sampling effort for plant health inspection

Surkov, I. V., Oude Lansink, A. G.J.M., van der Werf, W. — Mon, 19 Oct 2009 09:37:57 PDT

Plant import inspection can prevent the introduction of exotic pests and diseases, thereby averting economic losses. We explore the optimal allocation of a fixed budget, taking into account risk differentials, and the optimal-sized budget to minimise total pest costs. A partial-equilibrium market model is used to compute the economic consequences of pest invasion. An application to Dutch imports of chrysanthemum cuttings shows that the optimal allocation of a fixed inspection budget halves the cost of pest invasion compared to allocating the same budget equally over all imports. A budget increase that enables 42 per cent more inspection can reduce total societal costs by 81 per cent compared to smaller, constrained budget that ignores risk differentials.

Demand elasticities for farmed salmon in world trade

Xie, J., Kinnucan, H. W., Myrland, O. — Mon, 19 Oct 2009 09:37:43 PDT

The generalised demand specification of Barten and Eales et al. is used to estimate the world demand curves faced by major exporters of farmed salmon. Results suggest that the demand for farmed salmon has become less price elastic over time, fresh salmon from the UK faces the most competition in world markets and fresh salmon from Chile the least. Promotion programmes sponsored by the Norwegian Seafood Export Council appear to have increased the demand for fresh salmon at the expense of frozen salmon. Although the estimated promotion effects are small, the programme appears to have been remunerative from the Norwegian producer perspective.

Cooperative liquidation under competitive stress

Cross, R. M., Buccola, S. T., Thomann, E. A. — Mon, 19 Oct 2009 09:37:20 PDT

Competitive environments encourage cooperatives to liquidate by distributing equity to their members, often by raising the transfer prices paid for member raw product. We provide a method of detecting when such liquidation activity begins. In the process, we derive the arbitrage-free price bounds of a broad class of forward contracts typical of seasonal and speciality agricultural markets. The bounds are illustrated for the failed Tri-Valley Growers, once the largest fruit/vegetable cooperative in the USA. We show that Tri-Valley began liquidation years before it was detectable through conventional means. Implications are drawn for the expanding competitive pressures accompanying EU enlargement.

Demand for on-farm permanent hired labour on family holdings: a comment

Kimhi, A. — Tue, 13 Oct 2009 03:56:18 PDT

This comment discusses several aspects of the recent paper by Blanc et al. (2008), focussing on the link between the theoretical and empirical models. It argues that there is an inconsistency between the two models in the way households are segmented into different labour regimes. The econometric approach is also queried.

Eco-labelled food products: what are consumers paying for?

Bougherara, D., Combris, P. — Thu, 20 Aug 2009 04:22:35 PDT

The paper investigates whether the premium consumers are willing to pay for an eco-labelled product is driven by selfish or altruistic motives. Using an incentive-compatible experiment with both a within- and a between-subject design, we study the effect on this premium of information stating that eco-friendly products do not necessarily lead to higher private benefits. We find that this information does not affect buying prices in the within-subject experiment. This suggests that consumers’ willingness to pay for the eco-labelled product does not derive from perceived higher taste or safety attributes but from other motives. These results are confirmed in the between-subject design where we find that information affects buying prices for the eco-friendly product but also for the control product in the between-subject experiment.