The present article uses the modified Arkansas off-stream reservoir analysis and the environmental policy-integrated climate models to examine the impacts of on-farm reservoirs and tail water recovery systems in conjunction with other best management practices on profitability, water use, and sediment control for rice-soybean farming operations. Results suggest that, under limited water availability conditions, reservoirs and tail water recovery systems can improve profitability, reduce ground water dependence, and reduce the movement of sediment, nutrients, and pesticides off-farm. Although reservoirs may not be profitable under plentiful water conditions, cost-sharing opportunities may make them a viable means of addressing environmental concerns.

We investigated the environmental impacts of alternative cultural practices within a watershed under different water quality standards. We used experimental data on nutrient runoff to determine the optimal amount of broiler litter application in hay production in Louisiana. To compensate for the lack of experimental data, we used biophysical simulation models to find the optimal combination of agricultural best-management practices in a watershed in Mississippi. The results indicated that stricter environmental standards lower total profit potential and litter utilization.

This paper examines the possibility that insurance for row crops, livestock, and aquaculture can be used effectively to encourage producers to adopt practices that will improve environmental behavior. Examples of agricultural environmental insurance are provided and considered in the context of alternative policy mechanisms. The current state of agricultural insurance and the nonagricultural environmental insurance market are explored. We also lay out the characteristics of an insurable risk along with the theoretical basis of insurance provision. An empirical example of an environmental insurance design is provided, and the behavioral implications of such a design are examined. Finally, we discuss important considerations that should be evaluated when considering an attempt to implement an agricultural insurance program directed at environmental behavior.

Due to red meat consumption, bovine spongiform encephalopathy (BSE) disease has been a major human health concern since its discovery in 1986. An event study approach was applied to determine the impact of BSE official events that occurred in the United Kingdom on U.S. live cattle futures prices. When abnormal returns were aggregated during the course of the events, the price series were adversely affected, mainly after the event day. This suggests that market reaction was dissipated quickly and that no leakage of information occurred prior to the event.

Cross-sectional data sets containing expenditure and quantity information are typically used to calculate quality-adjusted imputed prices. Do sample size and quality adjustment of price statistically alter estimates for own-price elasticities? This paper employs a data set pertaining to three food categories—pork, cheese, and food away from home—with four sample sizes for each food category. Twelve sample sizes were used for both adjusted and unadjusted prices to derive elasticities. No statistical differences were found between own-price elasticities among sample sizes. However, elasticities that were based on adjusted price imputations were significantly different from those that were based on unadjusted prices.