The 50/92 and 0/92reduced planting alternativestives of the 1985 farm bill allow farm program participants more flexibility in making production decisions. Specifically, these provisions relax the incentive to produce inherent in earlier commodity programs that linked deficiency payments directly to harvested acreage. This study examined the value of this additional decision flexibility for crop producers in the Blacklands of Central Texas. The results suggest that the reduced planting alternatives would not be used by, and have no value for risk neutral producers, but have substantial value for risk averse producers who would reduce planted acreage in years when yield expectations are low.

Biotechnology research promises to have a greater impact on agriculture and society as a whole than any other technological development in agriculture in the past (such as hybrid corn) or any in the foreseeable future. Biotechnology research potentially encompasses a multitude of technological developments that are likely to impact all aspects of agriculture from agricultural production to food processing to food consumption and possibly even to waste and residuals management, pollution control and water quality.

Farm producers attempt to mitigate risk and uncertainty by utilizing accurate and reliable information. This research attempts to identify sources of information used by Ohio fruit producers and then determine which of these sources are best meeting their information needs. Results are based on a logit analysis of Ohio fruit producers and several factors are shown to influence producers' evaluation of the “adequacy” of their marketing information. Among these factors are age, business size, education, type of enterprise, and types of information sources. Reported findings have implications for marketing efficiency, particularly if producers' evaluation of infonnation as adequate is positively related to its efficient use.

The potential role for economics in biotechnology research does not differ from the role of economics in examining research in general. There is a substantial literature on that topic. Hans Binswanger has posed four questions that an economic analysis of technical change should address. These questions provide a useful roadmap for thinking about the role of economics in biotechnology research.

Integrated pest management (IPM) initially focused on insect pest control. More recently, IPM encompasses a broader concept of management, one which crosses several disciplinary boundaries. This article reports results of research dealing with four integrated management decisions for alfalfa (cultivar selection, inset control, weed control, and end-of-season harvest options).

Granger-causality tests and Sims' VAR technique were used to analyze the impact of macrovariables on farm output and prices in the U.S. for the period 1934-1987. Granger-causality tests show one-way causality from the macrovariables to the farm sector variables, and this is supported by impulse response functions from a VAR model. Money and interest rate effects on agricultural prices and output are apparent in the data.

This analysis uses a dichotomous qualitative response model to assess the influences of several economic and demographic characteristics of consumers on the purchase decision for variety (edible organ and offal) meats. Specific factors considered include education, age, income, household size, and ethnic heritage. Data collected from a survey of 3, 340 consumers are utilized. Results confirm strong income, age, household size, and ethnic effects on the purchase of variety meats.

Reservations on technical and theoretical grounds in the use of the consumer surplus approach to measure benefits of government programs have often appeared in the literature. Therefore, this paper uses an alternative approach in a case study to estimate the annual economic surplus created in South Carolina from deregulating tobacco production. Impacts of deregulation on cropping patterns and income on representative tobacco farms, and distribution of benefits in the economy are examined. Results of this study indicate that deregulation stimulates the economy and would increase the net value added by $5.8 million in the long run.

A hedonic framework is used to analyze selected attributes of Louisiana deer hunting leases that are hypothesized to be significant contributors to lease value. The flexible Box-Cox functional form is used in contrast to the often utilized linear regression specification. Additionally, the hypothesis of regional differences in slope coefficients of lease attributes is addressed. Results indicate that hunters in the two analyzed regions value lease attributes and services differently.

Conceptual weaknesses in the use of costs of average abatement as a measure of the cost effectiveness of agricultural nonpoint pollution control are examined. A probabilistic alternative is developed. The focus is on methods for evaluating whole-farm pollution control plans rather than individual practices. As a consequence, the analysis is presented in a chance-constrained activity analysis framework because activity analysis procedures are a practical and well developed device for screening farm plans. Reliability of control is shown to be as important as reduction targets in designing farm plans for pollution control. Furthermore, broad-axe prescriptions of technology in the form of Best Management Practices may perform poorly with respect to cost effectiveness.

An eight-equation partially-recursive econometric model is specified to indicate the effects of catfish advertising on product awareness, beliefs, attitude and consumption. Results indicate the ad campaign in its first year (i) increased consumers' awareness of farm-raised catfish 15 percent, (ii) improved consumers' perceptions of and attitude toward catfish 3 to 6 percent, and (iii) increased at-home and restaurant purchases of catfish 12 to 13 percent. The response to the ad campaign is broken down into an “attitude effect” and a “reminder effect” to determine the relative behavioral importance of the affective and cognitive components of the ad copy. Model simulations suggest primacy of the reminder effect, implying the factual content of the ads had less impact on behavior than the mere presence of the ads.

A test for static equilibrium developed by Schankerman and Nadiri is used to evaluate the hypothesis that land and capital in aggregate south-eastern U.S. agriculture behave as fixed inputs. Empirical results reject the hypothesis that these two inputs are at their long-run equilibrium levels implied by observed prices. Thus, some degree of asset fixity may be concluded.

Using a dual economic specification of a multiproduct technology, the structure of agricultural production was tested for five South Central states (Texas, Oklahoma, Arkansas, Mississippi, and Louisiana). A comprehensive set of output supplies and input demands comprised the estimation equations in each state. Evidence of nonjoint production in a subset of commodities was detected in four of the five states. Several commodities also satisfied sufficient conditions for consistent aggregation. However, the specific outputs satisfying each structural property varied by state. Sufficient conditions for consistent geographic aggregation across the states were not satisfied. These results provide empirical guidance and important cautions for legitimately simplifying state-level model specifications of southern agricultural production.

This paper uses a deterministic asset replacement model to examine the implications of the 1986 Tax Reform Act (TRA) for replacement investment in U.S. agriculture. The optimal replacement age for an asset is shown to be inversely related to the size of investment tax credits and the present value of depreciation allowances but generally directly related to marginal tax rate. Simulation results indicate that the net effects of the TRA vary across assets. Replacement ages for assets with relatively long depreciation lives (e.g., farm structures) tend to fall. Those for assets with relatively short depreciation lives rise (e.g., tractors).

The importance of timeliness is investigated in the selection of machinery complements for double-crop wheat and soybean production in the southeastern coastal plain. An intertemporal stochastic simulation model was developed to generate probability distributions that were evaluated with stochastic dominance analysis. This research investigated the importance of intertemporal production linkages and inadequate soil moisture on machinery selection. Failure to include these dimensions can result in erroneous machinery choices.

Farm-level data are used to estimate equations explaining the probability of bidding and the level of the bid for the 1986 Dairy Termination Program. Participation was attractive to older farmers, to those who were not planning to transfer the farm to a family member, to less experienced farmers, and to those using less sophisticated management techniques. Schooling, off-farm work, and nonfarm experience did not have significant effects. The participation pattern suggests that the long-term effects of the program on milk supply are small.

Conservation initiatives in the 1985 Farm Bill affected farmers' decisions regarding soil conservation. A farmer survey was conducted and a multi-period mixed-integer programming model was developed to determine an optimal farm plan with choices of crop-tillage combinations and land retirement Results indicate that farmers' incentives to reduce soil loss in the Sand Mountain region in Alabama are not substantially affected by provisions of the 1985 Farm Bill. The bid price for the Conservation Reserve Program will have to be considerably higher than 1988 levels to provide an incentive to remove land from production.

This paper analyzes a variable price support program (VPS) as an alternative to the current farm income support program. The VPS program can control U.S. agricultural production while protecting income of small farmers. The VPS is designed to alter farm level production decisions by reducing commodity support prices for each additional unit of production produced. This will serve to discourage excess aggregate production. The VPS program can be a mechanism to stabilize income of efficient small farms during the transition from the current farm programs to a free market environment. An illustrative study is used to target government program benefits to various farm-size groups.

The marginal benefit and cost of diversification for Florida orange producers is analyzed using certainty equivalents. Results indicate that for moderate and high levels of risk aversion, diversification into strawberry, grapefruit, or additional orange production is not optimal. However, moderately risk averse Florida orange producers can gain by diversifying into grapefruit production if the annual amortized fixed costs can be reduced by as little as 10 percent.

Target-MOTAD was used to assess the risks and returns of sustainable cotton crop rotations from Auburn University's 92-year “Old Rotation.” Study results analyze rotations of continuous cotton, with and without winter legumes; two years of cotton-winter legumes-corn, with and without nitrogen fertilization; and three years of cotton-winter legumes-corn and rye-soybeans double-cropped. Ten years of observations on deviations from target income were used to identify optimal sustainable rotation(s). Study results suggest that diversification in rotations, as well as in crops, results in the least risk for a given level of target income.