A two-stage approach is used to estimate sensitivity of corn, wheat, and soybean yields to changes in prices and land idled. Estimated elasticity of demand for fertilizer per acre with respect to expected output price equals 0.47, 0.10, and 0.82 for corn, wheat, and soybeans. Upper estimates of the elasticity of yield with respect to fertilizer equals +0.58, +0.29, and +0.16 for corn, wheat, and soybeans. Yields are found to be quite insensitive to price changes. Fertilizer demands and yields are insensitive to land idled under farm programs.

The dualistic nature of humans has been recognized for centuries. The intriguing question is the extent to which the human being with her/his display of concern for others can simultaneously act as an egoist, the latter being descriptive of the homo oeconomicus rendition of the human. Multiple utility theory suggests a way to approach research on such issues. A test case of water conserving technology adoption behavior by Florida growers is examined. Empirical evidence supports moving toward an expanded version of the mono-utility or I-utility model to include a We-utility.

Public support for integrated pest management (IPM) is derived in part from concerns over food safety and the environment, yet few studies have assessed the economic value of health and environmental benefits of IPM. An approach is suggested for such an assessment and applied to the Virginia peanut IPM program. Effects of IPM on environmental risks posed by pesticides are assessed and society's willingness to pay to reduce those risks is estimated. The annual environmental benefits of the peanut IPM program are estimated at $844,000. The estimates of pesticide risks and willingness to pay can be applied elsewhere in economic assessments of IPM.

This study utilized a semiparametric panel model to estimate environmental Kuznets curves (EKC) for carbon dioxide (CO2) in 15 Latin American countries, using hitherto unused data on forestry acreage in each country. Results showed an N-shaped curve for the region; however, the shape of the curve is sensitive to the removal of some groups of countries. Specification tests support a semiparametric panel model over a parametric quadratic specification.

We examined four evolution paths of the biofuel sector using a partial equilibrium world agricultural sector model in CARD that includes the new RFS in the 2007 EISA, a two-way relationship between fossil energy and biofuel markets, and a new trend toward corn oil extraction in ethanol plants. At one extreme, one scenario eliminates all support to the biofuel sector when the energy price is low, while the other extreme assumes no distribution bottleneck in ethanol demand growth when the energy price is high. The third scenario considers a pure market force driving ethanol demand growth because of the high energy price, while the last is a policy-induced shock with removal of the biofuel tax credit when the energy price is high. Standard results hold where the biofuel sector expands with higher energy price, raising the prices of most agricultural commodities through demand side adjustment channels for primary feedstocks and supply side adjustment channels for substitute crops and livestock. On the other hand, the biofuel sector shrinks coupled with opposite impacts on agricultural commodities with the removal of all support including the tax credit. Also, we find that given distribution bottlenecks, cellulosic ethanol crowds marketing channels resulting in a corn-based ethanol price that is discounted. The blenders' credit and consumption mandates provide a price floor for ethanol and for corn. Finally, the tight linkage between the energy and agricultural sectors resulting from the expanding biofuel sector may raise the possibility of spillover effects of OPEC's market power on the agricultural sector.

A logistic regression procedure was used to assess the impact of socioeconomic attributes on the best management practices (BMPs) adoption decision by Louisiana dairy farmers relative to cost-share and fixed incentive payments. Analysis of the steps in the BMP adoption decision process indicated visits between producers and the U.S. Department of Agriculture–Natural Resource Conservation Service significantly increase likelihood of BMP adoption. Producer willingness-to-pay results indicate that marginal increases in dairy BMP adoption and associated improvement in environmental quality require increased technical and financial assistance.

Nature-based tourism (NBT), alternatively known as ecotourism, is a rapidly expanding area in the tourism travel sector. States such as Louisiana with a well established urban-based tourism industry may have expansion opportunities through development of complementary nature-based tourism. This study analyzes the decision to participate in nature-based tourism and identifies factors, including attitudinal, that influence the decision to participate in NBT among Louisiana tourists.

Motivated by repeated price spikes and crashes over the last decade, weinvestigate whether the growing market shares of futures speculatorsdestabilize commodity spot prices. We approximate conditional volatility andanalyze how it is affected by speculative open interest. In this context, wesplit our sample into two equally long subperiods and document whether thespeculative impact on conditional volatility increases. With respect to sixheavily traded agricultural and energy commodities, we do not find robustevidence that this is the case. We thus conclude that the financializationof raw material markets does not make them more volatile.

A new, post-industrial, paradigm for agriculture is emerging under the concept of sustainable agriculture. The sustainability paradigm has emerged to solve problems created by the industrial model, primarily environmental pollution and resource base degradation. The role of farm size in this transformation to a more sustainable agriculture is the issue addressed. Using a descriptive approach, and relying on a survey of the literature including emerging paradigms and observations, we conclude that, from a sustainability perspective, the smallest effective size will be the most competitive size for farms, as for other knowledge-based enterprises of the future.

Potato farmers in Ecuador rely on chemical inputs to manage pests and optimize yields. Integrated pest management techniques lower production costs, reduce pesticide exposure, and improve long-term agricultural sustainability. Public extension does not, however, exist in Ecuador, and cost-effective means of communicating complex messages to producers are needed. We analyze cost-effectiveness of alternative dissemination methods, including farmer field schools (FFS), field days, pamphlets, and word-of-mouth transmission. Field days and pamphlets have strong impacts on adoption, especially considering their low costs. FFS are effective, but expensive. Evidence also indicates significant diffusion from FFS to non-FFS farmers, indicating high complementarity across methods.

This study demonstrates how contingent valuation techniques can be used in a cost-benefit analysis of a food safety policy issue. The analysis focuses on banning a specific postharvest pesticide used in fresh grapefruit packinghouses. Benefits of the ban are measured using consumers' aggregated willingness to pay (WTP) for safer grapefruit. A national contingent valuation survey used the payment card method to obtain WTP data. Costs of the ban stem predominantly from increased postharvest losses and were estimated using a model of the market for Florida grapefruit. Results indicate that benefits of the ban outweigh costs.

Ecolabeling allows firms to segment a market by informing consumers about unobservable attributes of a product. Previous studies evaluate consumer preferences for products explicitly labeled as possessing positive environmental attributes. This research evaluates consumers’ willingness to pay for a product that is perceived by the consumer as having environmentally friendly attributes. We explore glass packaging for fluid milk as a case study. Data were collected through a contingent valuation survey, and a bound-and-a-half logit model was employed. The estimated premium is 59.78 cents with a premium between $0.73 and $0.92 for consumers more likely to prefer the glass alternative.

This paper estimates the on-farm impacts of adopting herbicide-tolerant soybean on herbicide use, yields, and farm profits, using an econometric model that corrects for self-selection and simultaneity and is consistent with profit maximization. The model is estimated using nationwide farm-level survey data for 1997. Given that the use of herbicide-tolerant soybeans involves the substitution of a particular herbicide—primarily glyphosate—for other herbicides, we explicitly consider this substitution process in the model.

Per capita rice consumption in the U.S. has doubled over the past decade. The effects of social and demographic variables on the household's rice consumption decisions are analyzed along with income and price variables. A double-hurdle model is used to solve simultaneously the consumer decisions whether to purchase rice and how much. The joint decision hypothesis is tested and accepted. The non-normal distribution of error terms may be responsible for possible bias in the empirical test of the joint decision hypothesis. The hyperbolic sine transformation is used to correct the problem in this study prior to testing the joint decision hypothesis.

An outbreak of foot-and-mouth disease (FMD) in the United States would likely result in major costs to producers, consumers, and government. How animal health officials manage such an outbreak has substantial impact on probable losses. Without an emergency FMD vaccination strategy, producer and consumer losses of an FMD outbreak in the midwestern United States would likely approach $188 billion, and government costs would likely exceed $11 billion. In contrast, a high-capacity emergency vaccination program together with a large vaccination zone would reduce median consumer and producer losses to approximately $56 billion and government costs to a little more than $1 billion.

Actual performance records of production contract farmers are used to assess the extent to which contract production reduces the risk borne by pork producers. Comparisons of contracting relative to independent market production reveal that farmers who enter into production contracts based on absolute performance measures reduce risks associated with variable income. Weak evidence is found that relative performance contracts, similar to those used in the broiler chicken industry, further reduce income variability. The effectiveness of such relative performance contracts will rely on several factors; among these are increased contract production and a more uniform pork production and processing system.

This article reviews literature on competitiveness of agricultural product and input markets. Although researchers in the United States and Europe emphasize different stages of the agricultural and food marketing system, their focus is similar: extent of buyer power, although both have largely ignored the sector supplying inputs to agriculture. The key conclusion is that there is little robust empirical evidence for food processing firms exerting buyer power, and there are limited data concerning vertical contracts between food processing and agriculture, but there is a small body of evidence concerning food retailer behavior and vertical coordination between food retailing and processing.

The parameters of yield response functions can vary by year. Past studiesusually assume yield functions are nonstochastic or “limited” stochastic. Inthis study, we estimate rye–ryegrass yield functions in which all parametersare random. The three functional forms considered are the linear responseplateau, the quadratic, and the Spillman-Mitscherlich. Nonstochastic yieldmodels are rejected in favor of stochastic parameter models. Quadraticfunctional forms fit the data poorly. Optimal nitrogen applicationrecommendations are calculated for the linear response plateau andSpillman-Mitscherlich. The stochastic models lead to smaller recommendedlevels of nitrogen, but the economic benefits of using fully stochastic cropyield functions are small because expected profit functions are relativelyflat for the stochastic yield functions. Stochastic crop yield functionsprovide a way of incorporating production, uncertainty into inputdecisions.

A sample of Kansas farms was used to examine the impact of risk and specialization on mean financial performance. Mean financial performance was hypothesized to be influenced by risk, age of the operator, percentage of acres owned, financial efficiency, leverage, specialization, and farm size. Risk, age of operator, financial efficiency, and farm size had the largest impacts on mean financial performance. Specializing in swine, dairy, or crop production increased mean financial performance, while specializing in beef production decreased mean financial performance. Farms with both crops and a livestock enterprise (beef, swine, or dairy) tended to have less variability in financial performance.

This article examines food price volatility in Greece and how it is affected by short-run deviations between food prices and macroeconomic factors. The methodology follows the GARCH and GARCH-X models. The results show that there exists a positive effect between the deviations and food price volatility. The results are highly important for producers and consumers because higher volatility augments the uncertainty in the food markets. Once the participants receive a signal that the food market is volatile, this might lead them to ask for increased government intervention in the allocation of investment resources and this could reduce overall welfare.