Cooperation among players requires a realization of economic benefits to all players and a meeting of efficiency requirements through economically driven allocations. Cooperation among political (and sometimes hostile) players may not meet these requirements. Political considerations, usually ignored in economic analyses, can hinder or even block possible arrangements. A framework is proposed that includes both economic and political considerations for evaluating transfers or trades of scarce resources. This method quantifies both the economic payoffs using n-person game theory and the political likelihood of any of the coalitions actually forming, using the PRINCE Political Accounting System. The economic-political approach is applied to a case of a potential water transfer in the western Middle East. Results suggest that incorporating political considerations in the analysis stabilizes the regional solution suggested by economic-related allocations.

This study examines the dynamic effects of changes in exchange rates on bilateral trade of agricultural products between the United States and its 15 major trading partners. Special attention is paid to investigate whether or not the J-curve hypothesis holds for U.S. agricultural trade. For this purpose, an autoregressive distributed lag (ARDL) approach to cointegration is applied to quarterly time-series data from 1989 and 2007. Results show that the exchange rate plays a crucial role in determining the short- and long-run behavior of U.S. agricultural trade. However, we find little evidence of the J-curve phenomenon for U.S. agricultural products with the United States’ major trading partners.

This paper summarizes a multi-state, multi-year study assessing the potential for local agriculture in northern New England. While largely rural, this region's agricultural sector differs greatly from the rest of the United States, and demand for locally produced food has been increasing. To assess this unique economic landscape, researchers and Cooperative Extension at the Universities of Maine, New Hampshire, and Vermont investigated four key areas: (1) local food capacities, (2) constraints to agricultural expansion, (3) consumer preferences for local and organic produce, and (4) the role of intermediaries as alternative local food outlets. The project included input from local farmers, Extension members, restaurants, and the general public. We present the four research areas in a sequential, overlapping fashion. The timing of our research was such that each step in the process informed the next and can be used as a template for assessing a region's potential for local agricultural production.

Multiple-objective decision making (MODEM) provides an effective framework for integrated resource assessment of agroecosystems. Two elements of integrated assessment are discussed and illustrated: (1) adding noneconomic objectives as constraints in an optimization problem; and (2) evaluating tradeoffs among competing objectives using the efficiency frontier for objectives. These elements are illustrated for a crop farm and watershed in northern Missouri. An interactive, spatial decision support system (ISDSS) makes the MODEM framework accessible to unsophisticated users. A conceptual ISDSS is presented that assesses the socioeconomic, environmental, and ecological consequences of alternative management plans for reducing soil erosion and nonpoint source pollution in agroecosystems. A watershed decision support system based on the ISDSS is discussed.

Estimating how the use of production contracts affects farm productivity is difficult when unobservable factors are correlated with both the decision to contract and productivity. To account for potential selection bias, this study uses the local availability of production contracts as an instrument for whether a farm uses a contract in order to estimate the impact of contract use on total factor productivity. Results indicate that use of a production contract is associated with a large increase in productivity for feeder-to-finish hog farms in the United States. The instrumental variable method makes it credible to assert that the observed association is a causal relationship rather than simply a correlation.

This study analyzes the participation decision and income impacts of fair-trade coffee certification on small-scale coffee producers in the Araku valley in India using panel data for 183 households and endogenous-switching and quantile regression methods. The results show that fair trade certification has a positive effect on income; the income of certified farmers is 17 percent higher on average than the income of uncertified coffee producers. Furthermore, fair trade certification has a “bottom of the pyramid” effect in that the largest income gains accrue to farmers in the poorer quantiles.

Recent efforts to refine the concept of existence value and to empirically measure it has led to an unnecessary narrowing of the concept of existence value. This paper uses the literature on public goods to argue that existence value is a much broader concept than proposed by several authors. Two commonly used but different empirical approaches to measuring existence values are compared and shown to lead to statistically different decompositions of total value between use and existence categories.

Environmental economics has made it possible to estimate prices for air pollution externalities. However, these values are rarely observed in emissions trading markets. Moreover, market outcomes show prices persistently remain below expectations and frequently fall over time. Low allowance prices may appear virtuous, but often reflect poor market design that does not anticipate interaction with other policies, and may undermine confidence in market-based approaches to environmental policy. This paper surveys emissions markets and factors influencing prices, and concludes with a discussion of how market design can anticipate and remedy the strong tendency for low prices.

The effects of socioeconomic and demographic factors on the consumption of food energy, protein, vitamin A, vitamin C, thiamin, riboflavin, niacin, calcium, phosphorus, and iron are examined. Socioeconomic and demographic factors analyzed are urbanization, region, race, ethnicity, sex, employment status, food stamp participation, household size, weight, height, age, and income. Several of these factors significantly affect consumption of certain nutrients. Income is an important factor affecting the consumption of vitamin A, vitamin C, and calcium. Income elasticities are relatively small at low income levels. For example, income elasticities range from 0.016 for calcium to 0.123 for vitamin C at an income level of $20,000.

This study examines the impact of adopting Bt corn on farm profits, yields, and insecticide use. The study employs an econometric model that corrects for self-selection and simultaneity. The model is estimated using nationwide farm-level survey data for 2005. Regression analysis confirms that Bt adoption is associated with increased variable profits, yields, and seed demand. However, the results of this analysis suggest that Bt adoption is not significantly related to insecticide use. This result may be due to the fact that insect infestation levels were lower in 2005 than they were in previous years.

We examine the impact of four policy options on consumption of carbonated soft drinks (CSDs) by estimating a random-coefficient discrete-choice model of demand. Policy simulations using demand estimates indicate that the impacts of banning television advertising, limiting container size, and limiting calories on total consumption would be similar—an estimated 15.40–15.75 percent reduction. However, limiting calories would have a significantly greater impact on consumption of regular CSDs (–28.89 percent) and on calories consumed from CSDs (–19.34 percent). A tax on calories was least effective in curtailing overall consumption and consumption of regular CSDs.

Conservation programs faced with limited budgets often use a competitive enrollment mechanism. Goals of enrollment might include minimizing program expenditures, encouraging broad participation, and inducing adoption of enhanced environmental practices. We use experimental methods to evaluate an auction mechanism that incorporates bid maximums and quality adjustments. We examine this mechanism's performance characteristics when opportunity costs are heterogeneous across potential participants, and when costs are only approximately known by the purchaser. We find that overly stringent maximums can increase overall expenditures, and that when quality of offers is important, substantial increases in offer maximums can yield a better quality-adjusted result.

Economists increasingly face opportunities to collaborate with ecologists on landscape-level analyses of socioeconomic and ecological processes. This often calls for developing empirical models to project land use change as input into ecological models. Providing ecologists with the land use information they desire can present many challenges regarding data, modeling, and econometrics. This paper provides an overview of the relatively recent adaptation of economics-based land use modeling methods toward greater spatial specificity desired in integrated research with ecologists. Practical issues presented by data, modeling, and econometrics are highlighted, followed by an example based on a multidisciplinary landscape-level analysis in Oregon's Coast Range mountains.

We investigate geospatial and socio-demographic attributes that explain differences in community-level policies affecting unconventional gas development (UGD) in New York. We examine local policy decisions (i.e., municipal bans, moratoria, and pre-emptive resolutions supporting development) through ordered probit models and middle-inflated and zero-inflated ordered probits to account for communities without UGD policies and estimate a spatial ordered probit to address spatial correlations between communities' decisions. Our findings suggest that New York communities near Pennsylvania UGD are more likely to support UGD. Communities that are predominantly Democrat or have more citizens who have bachelor's degrees are more likely to adopt policies opposing UGD.

A variety of questioning formats have been used in contingent-valuation studies, with dichotomous-choice questions becoming the preferred format. However, as with any empirical technique, continued applications raise questions that require attention if the credibility of the procedure is to be maintained. It is shown that estimated Hicksian surplus can be substantially affected by the selection of a functional form when analyzing responses to dichotomous-choice questions. Given that theory, intuition, and empiricism all play a role in developing these estimates, several maxims are suggested for evaluating and/or mitigating such effects in future studies.

Perennial energy crops like switchgrass that are used for biofuel production have the potential to generate various water quality benefits such as reduced nitrogen runoff. Yet the current expected returns to switchgrass are not profitable enough for these crops to be widely adopted by U.S. farmers due to relatively unstable yields, volatile revenues, and high costs of crop establishment. This study uses a dynamic economic model to investigate the uncertainties in the yields and costs of switchgrass production, in comparison with those of corn-soybeans in the Chesapeake Bay Watershed in Pennsylvania. Results indicate that farmers would be willing to convert corn-soybeans to switchgrass land use with the provision of payments for ecosystem services (PES). A targeted PES policy based on the environmental effectiveness of the crop land is found to be slightly more effective in providing nitrogen reductions than a uniform PES policy with cost savings of 8–19%. Moreover, switchgrass has the potential of providing energy supply while reducing greenhouse gases emissions.

Although adoption of agricultural innovations has been extensively examined in the literature, its impact on indicators of farm production and household welfare measures remains ambiguous in the context of sub-Saharan Africa (SSA). This study contributes to the literature by conducting a meta-regression analysis on 92 studies published between 2001 and 2015 in the SSA region. Overall, empirical results from the meta-analysis suggest that adoption of agricultural innovations has a positive and significant effect on indicators of farm production and household welfare measures. However, the magnitude of the impact is relatively small, which also suggests a weak relationship.

This study examines the impacts of two types of advertising content—healthy eating and anti-obesity advertising—on the demand for healthy and unhealthy food and beverage items. We show that differentiating consumers by weight is crucial in fully understanding the effects of advertising content on food and beverage demand. We find that among overweight individuals, anti-obesity advertisements are more effective than healthy eating advertisements at reducing the demand for unhealthy items and increasing the demand for healthy items. Furthermore, the magnitude of this effect increases with BMI. We discuss possible explanations and policy implications based on our results.

Precision farming information demanded by cotton producers is provided by various suppliers, including consultants, farm input dealerships, University Extension systems, and media sources. Factors associated with the decisions to select among information sources to search for precision farming information are analyzed using a multivariate probit regression accounting for correlation among the different selection decisions. Factors influencing these decisions are age, education, and income. These findings should be valuable to precision farming information providers who may be able to better meet their target clientele needs.

We investigate effects of corn-based ethanol plants on local land uses using county-level panel data for Iowa for 1997 through 2009 and an Arellano-Bond difference-generalized method-of-moments estimator. Our results show that ethanol plants have statistically significant effects on the proportion of acres planted to corn in the plants’ host counties. Furthermore, ceteris paribus, the land-use-change effect of locally owned plants (owned by local farmers or cooperatives) is about twice as large as the effect of plants with nonlocal owners. We also explore implications for the environment of ethanol plants and the changes in land use that they induce.