A Diewert-flexible (dual) cost function was used to derive a system of conditional factor demand equations for Louisiana rice producers. Generalized Leontief cost and factor share equations were fitted for the 1955-87 period using Zellner's SURE system estimation procedure. The Aitken parameter estimates reveal that: (1) the optimal input mix of rice farmers varies with production scale, (2) the factor-augmenting technical change is labor and chemical saving but seed using, (3) pairwise input substitutions are limited, and (4) factor demands are own-price inelastic. An implication is that Louisiana rice farmers will not appreciably alter their factor utilizations when relative input prices change.

Markowitz developed the theoretical background for analysis of investments in reference to the mean and variance of returns of the portfolio of all investments (E-V analysis). Subsequently, Freund adapted the E-V model to farm enterprise decisions, and agricultural economists have applied this model to various agricultural firm problems. The studies of Kliebenstein and Scott, Brink and McCarl, Heifner, Buccola and French, and Raikes, Sieck, and Miller are examples of applications to farm enterprise organization, farm commodity marketing, and procurement of farm commodities by agribusiness firms. These studies are concerned largely with either production or marketing decisions; applications to joint production and marketing decisions are more limited. Exceptions include Whitson, Barry, and Lacewell's study of vertical integration and Barry and Willmann's analysis of forward contracting. In addition, Lütgen and Helmers and Persuad and Mapp recently analyzed a limited number of marketing alternatives in conjunction with different enterprise alternatives.

In the article, stochastic frontier analysis of peanut-production efficiency in the Southeastern region of the United States is conducted with a view of assessing the likely farm-level impacts of the 2002 Farm Act. Results indicate that, although quota ownership did not significantly impact inefficiency, it is likely that limitations on the quota's transferability to areas with better growing conditions were a significant cause of inefficiency. The acreage shifts and improved yields following the passage of the 2002 Farm Act support this conclusion. Certain farm characteristics, such as farm size and operator's education and age, were also important for efficiency.

Determining appropriate topics and target audiences is essential to design effective educational outreach programs. Based on landowner responses to a mail survey, we determined both the importance and the availability of wildlife and forest management information topics to Mississippi landowners. Combining this information clearly identified the appropriate subject matter for outreach programs—topics important to landowners and for which information was relatively unavailable. The importance of wildlife and forest management information relative to its availability depended on the region, land use patterns, and landowner characteristics, thus demonstrating which segments of the population should be targeted to maximize program impact.

A recent trend in rural development policy emphasizes small business development in place of industrial recruitment. To analyze some of the likely effects of expanding the proportion of small firms in local economies, an empirical wage rate model incorporating employer size was developed, and parameters were estimated using household data from rural Putnam County, Georgia. The estimates indicated that large employers offered higher wages than small employers and that the wage premium they offered was greater for blacks than for whites. These results support Thomas Till's argument that southern rural counties with relatively large black populations should not abandon efforts to attract large employers. Other factors associated with higher wages included level of education, previous labor force experience, and employment in certain occupations and industries.

Perhaps the degree of accuracy with which migration has been recorded and studied in the U.S. is unique to the relative youth of the nation in historical terms. However, many of the phenomena associated with migration that have economic significance are still very poorly understood. One of these is the functioning of the rural-urban labor market in the migration process. This particular aspect of the migration process is examined in this paper.

Specific information on the job research process of 396 migrants from Eastern Kentucky is reported and compared with previous research findings - with subsequent generalizations regarding the policy implications of observed patterns of job search activity.

Agricultural sustainability is an evolving process ever-seeking a balance between society's economic, environmental and social demands. Governmental policy and regulations while attempting to correct adverse externalities, have at times within themselves created adverse externalities. Failures often lie within the policies themselves, but poor coordination among government agencies is also at fault. This paper outlines a number of coordination issues and attempts to show how the empowerment of communities through ecosystem management is a partial solution to environmental degradation.

Groundwater is the predominant source of water for the 7,969 thousand acres of irrigated agriculture in Texas [5, p. 4.5]. Over 65 percent of Texas' irrigated acreage is watered from the Ogallala formation of the Texas High Plains. As opposed to conditions in other aquifers, the Ogallala does not receive appreciable recharge. Although the aquifer underlies virtually all of the 28,125 square mile High Plains land area, in many areas the aquifer is relatively thin (less than 100 feet) and in all areas the underlying water supply is expected to be exhausted in the foreseeable future. The average annual decline of the water table underlying irrigated acres of the High Plains has been approximately 3.5 feet.

A net trade model that includes environmental variables is used to analyze economic and environmental implications of various EC policies. There are environmental benefits from CAP reform, but a fertilizer tax results in greater nitrate and phosphate abatement. The input tax also results in smaller drops in EC farm income compared to CAP reform.

In recent years, extremely variable price movements have caused a high degree of price risk in the cattle industry. Cattle producers who chose to accept this price risk at the correct time had extraordinary gains, whereas those who accepted this risk at the improper time had returns below cost of production. Hedging offers the cattle producer an excellent opportunity to transfer a portion of the price risk to another party. Selective transfer of the risk can both increase the magnitude of returns and decrease their variance [1, 2, 4]. The family of technical tools called oscillators, one of the most useful tools employed by commodity traders [6, p. 34], was used to develop hedging strategies for feeder cattle.

“Farm bill” is a colloquial term for omnibus legislation that authorizes various government programs related to agriculture, food, and rural areas. Some of these programs have their roots in New Deal legislation. Others were initially authorized after the New Deal and subsequently included in farm bills. Some debate exists about exactly which omnibus legislation was the precursor of modern-day farm bills. However, since at least 1973, farm bills have included titles related to farm programs, trade, rural development, farm credit, conservation, agricultural research, food and nutrition programs, and marketing. Beginning in 2008, crop insurance-authorizing language was also included in the farm bill.

Farm bills generally have a life of approximately five years. In the case of farm support programs (typically authorized in Title 1), the farm billtemporarily amends permanent legislation. When the farm bill expires, theseprograms revert to permanent legislation (from the 1930s and 1940s) unless a new farm bill is adopted that again temporarily amends permanent legislation. The permanent legislation would put in place price supports, at extremely high levels, for many agricultural commodities, distorting markets and greatly increasing federal costs. The specter of reverting to permanent legislation has, through the years, been used by Congress to ensure that future Congresses will replace expiring farm bills with new legislation.

This article tests the efficiency of the hog options market and assesses the impact of the 1996 contract redesign on efficiency. We find that the hog options market is efficient, but some options yielded excess returns during the live hogs period but not during the lean hogs period. Our findings indicate that the hog options market is efficient and is consistent with the new contract improving the efficiency of the market. However, other market conditions such as lower transaction costs during the lean hogs period can also contribute to reduce expected option returns during the latter period.

Contract grazing feeder cattle is an arrangement where cattle owned by one party graze forage produced on land owned by another party. The forage producer is paid a fixed price per pound gained. Stochastic dominance analysis is used to compare contract grazing and the more traditional system in which the same individual owns both the cattle and land.

A multiperiod programming model was used to simulate the effects of lower marginal income tax rates, the soil and water conservation deduction, and the cash tax accounting option on firm growth for a “representative” farm operating in the Alabama Black Belt region. Results show the lowered marginal income tax rates associated with the Economic Recovery Tax Act (ERTA) of 1981 provide a positive growth stimulus to the modeled firm as measured by accumulated net worth over a 10-year planning horizon. The soil and water conservation deduction in general provides greater tax relief to the modeled firm than either the ERTA income tax rate changes or the cash tax accounting provision. Important complementary and substitute relationships were found to exist between marginal income tax rates and the various tax provisions studied, implying care must be exercised when attempting to evaluate the impact on farm firms of changes in tax policy.

Three economic opportunities are presented for rural areas in this invitedpaper session: self-employment, investments in broadband infrastructure, andagritourism. Self-employment has shown growth in rural regions at theexpense of wage and salary employment in the long-term. Productionagriculture interests by themselves are unlikely to provide sufficientfunding to expand infrastructure for broadband in rural areas. Agritourismapproaches appear to be very wide ranging with many educational demandsneeding to be met to maximize its diversification possibilities. Researchand extension faculty should be careful to focus on explaining the tradeoffsof these opportunities so that rural stakeholders do not fall victim to thelatest academic economic development fad.

My assignment is to ask what has been happening to the position of southern agriculture in national and world markets, and why. I do not have to answer the whole “why” question because the part of the answer relating to marketing institutions and policy is being handled by the other panelists. But I am sure you will agree that even the left-over bits are more than can be treated—at least by me—in a single paper.

An adaptive regression model is employed for estimating pre- and post-boll weevil eradication cotton-acreage response. Results indicate cotton acreage becoming more inelastic to own- and cross-price changes. As a result of this shift in acreage response and yield increases from eradication, net producer benefits on average are $88.73 per acre.

A disproportionately large share of our economic development problems, involving maldistributions of population, employment, and income, is found in rural areas. Although these problems directly affect the residents of rural areas, they are linked to economic problems in urban areas. Per capita income comparisons indicate the differential effects of economic development on the population. For example, per capita incomes of residents outside metropolitan areas are only about 71 percent of those in the orban-oriented ones. In addition, about one-third of all families live in nonmetropolitan areas, but over half of all low income families live there. Further, large geographic areas such as the Appalachian, Mississippi Delta, and Ozark regions are below the Nation as a whole in terms of the general level of economic development. Even in the urban centers of these rural regions, the average resident has not commensurately participated in the benefits derived from our Nation's economic development and growth. Comparisons of per capita income for different years show these maldistributions have persisted for decades.

The present paper examines the importance that efficient resource use may have for cotton growers under the current EU policy regime. To that end, input-oriented technical and scale efficiency scores for a sample of 172 cotton-growing farms are empirically quantified. The results suggest that cotton farms in the sample are not efficient mainly due to the nature of the policy regime governing the sector throughout EU. By becoming efficient, the co-responsibility levy will be reduced by 18.3% and farms may increase their profits by 50.1% on the average.

“The rate of interest charged should be … the amount the money could earn in an alternative investment. Interest is commonly charged at 6 percent on the average value of the machinery. …” This is a quotation taken from a bulletin published in 1965. Similar statements can be found in many publications. That bulletin has recently been revised. In the revision, the first part of that statement is still recognized, but the average investment method is not used to calculate interest costs.

In the first sentence, the principle of alternative opportunities is accepted, i.e., the minimum acceptable rate of return is that which the investor can obtain in an alternative investment that he would be willing to make. In general, economists agree that this is the rate that should be used in analyzing investment opportunities.