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Full-Text Articles in Social and Behavioral Sciences

Coordinating To Eradicate Animal Disease, And The Role Of Insurance Markets, David A. Hennessy Nov 2007

Coordinating To Eradicate Animal Disease, And The Role Of Insurance Markets, David A. Hennessy

CARD Working Papers

Farmed animal production has traditionally been a dispersed sector. Biosecurity actions relevant to eradicating infectious diseases are generally non-contractible, and might involve inordinately high transactions costs if they were contractible. If an endemic disease is to be eradicated within a region, synchronized actions need to be taken to reduce incidence below a critical mass so that spread can be contained. Using a global game model of coordination under public and private information concerning the critical mass required, this paper characterizes the success probability in an eradication campaign. As is standard in global games, heterogeneity in private signals can support a ...


Impact Of The South Korea-U.S. Free Trade Agreement On The U.S. Livestock Sector, Jacinto F. Fabiosa, Dermot J. Hayes, Fengxia Dong Nov 2007

Impact Of The South Korea-U.S. Free Trade Agreement On The U.S. Livestock Sector, Jacinto F. Fabiosa, Dermot J. Hayes, Fengxia Dong

CARD Working Papers

The recently signed Korea-U.S. Free Trade Agreement (KORUS FTA) grants the U.S. livestock industry with preferential access to South Korea's import market. This study evaluates the likely impacts of the KORUS FTA on the U.S. livestock sector.

Using the Food and Agricultural Policy Research Institute's modeling system, we find that livestock prices increase by 0.5% to 3.8% under the agreement. And together with an expansion by 381 to 883 million pounds in meat exports, the value of U.S. exports increase by close to U.S.$2 billion, or a 15.2% increase ...


Determinants Of Iowa Cropland Cash Rental Rates: Testing Ricardian Rent Theory, Xiaodong Du, David A. Hennessy, William M. Edwards Oct 2007

Determinants Of Iowa Cropland Cash Rental Rates: Testing Ricardian Rent Theory, Xiaodong Du, David A. Hennessy, William M. Edwards

CARD Working Papers

Based on the Ricardian rent theory, this study employs the variable profit function to analyze the determinants of Iowa cropland cash rental rates using county-level panel data from 1987 to 2005. Accounting for spatial and temporal autocorrelations, responses of local cash rental rates to changes in output prices and other exogenous variables are estimated. We find that Iowa cash rental rates are largely determined by output/input prices, soil quality, relative location, and other county-specific factors. Cash rents go up by $79 for a $1 increase in corn price in the short run. The marginal value of cropland quality, as ...


Changing Diets In China's Cities: Empirical Fact Or Urban Legend?, Fengxia Dong, Frank H. Fuller Sep 2007

Changing Diets In China's Cities: Empirical Fact Or Urban Legend?, Fengxia Dong, Frank H. Fuller

CARD Working Papers

China’s economic reforms, which began in 1978, resulted in remarkable income growth, and urban Chinese consumers have responded by dramatically increasing their consumption of meat, other livestock products, and fruits and by decreasing consumption of grain-based foods. Economic prosperity, a growing openness to international markets, and domestic policy reforms have changed the food marketing environment for Chinese consumers and may have contributed to shifts in consumer preferences. The objective of this paper is to uncover evidence of structural change in food consumption among urban residents in China. Both parametric and nonparametric methods are used to test for structural change ...


Tax, Subsidy, And/Or Information For Health: An Example From Fish Consumption, Stéphan Marette, Jutta Roosen, Sandrine Blanchemanche Aug 2007

Tax, Subsidy, And/Or Information For Health: An Example From Fish Consumption, Stéphan Marette, Jutta Roosen, Sandrine Blanchemanche

CARD Working Papers

A calibrated model is used to determine the welfare impacts of various regulatory instruments for improving health. The results of a lab experiment are integrated in a partial equilibrium model representing demands for two kinds of fish, one with higher nutritional benefits (canned sardines) and one with higher contamination risks (canned tuna) in France. In the laboratory, information about health effects leads to a statistically significant decrease (increase) in the willingness to pay for tuna (sardines). Simulations with the laboratory results show that, for most cases, a per-unit tax on tuna and a per-unit subsidy on sardines without any information ...


Intra-Household Allocation And Consumption Of Wic-Approved Foods: A Bayesian Approach, Ariun Ishdorj, Helen H. Jensen, Justin Tobias Jul 2007

Intra-Household Allocation And Consumption Of Wic-Approved Foods: A Bayesian Approach, Ariun Ishdorj, Helen H. Jensen, Justin Tobias

CARD Working Papers

WIC, the Special Supplemental Nutrition Program for Women, Infants, and Children, is a widely studied public food assistance program that aims to provide foods, nutrition education and other services to at-risk, low-income children and pregnant, breastfeeding and postpartum women. From a policy perspective, it is of interest to assess the efficacy of the WIC program - how much, if at all, does the program improve the nutritional outcomes of WIC families? In this paper we address two important issues related to the WIC program that have not been extensively addressed in the past. First, although the WIC program is primarily devised ...


Crop Yield Skewness Under The Law Of Minimum Technology, David A. Hennessy Jul 2007

Crop Yield Skewness Under The Law Of Minimum Technology, David A. Hennessy

CARD Working Papers

A large empirical literature exists seeking to identify crop yield distributions. Consensus has not yet formed. This is in part because of data aggregation problems but also in part because no satisfactory motivation has been forwarded in favor of any distribution, including the normal. This article explores the foundations of crop yield distributions for the Law of the Minimum, or weakest-link, resource constraint technology. It is shown that heterogeneity in resource availabilities can increase expected yield. The role of stochastic dependence is studied for the technology. With independent, identical, uniform resource availability distributions the yield skew is positive, whereas it ...


Are Standards Always Protectionist?, Stéphan Marette, John C. Beghin Jun 2007

Are Standards Always Protectionist?, Stéphan Marette, John C. Beghin

CARD Working Papers

We analyze the effects of a domestic standard that reduces an externality associated with the consumption of the good targeted by the standard, using a model in which foreign and domestic producers compete in the domestic good market. Producers can reduce expected damage associated with the externality by incurring a cost that varies by source of origin. Despite potential protectionism, the standard is useful in correcting the consumption externality in the domestic country. Protectionism occurs when the welfare-maximizing domestic standard is higher than the international standard maximizing welfare inclusive of foreign profits. The standard is actually anti-protectionist when foreign producers ...


Intellectual Property Rights And Crop-Improving R&D Under Adaptive Destruction, Oleg Yerokhin, Giancarlo Moschini Jun 2007

Intellectual Property Rights And Crop-Improving R&D Under Adaptive Destruction, Oleg Yerokhin, Giancarlo Moschini

CARD Working Papers

This paper studies how the strength of intellectual property rights (IPRs) affects investments in biological innovations when the value of an innovation is stochastically reduced to zero because of the evolution of pest resistance. We frame the problem as a research and development (R&D) investment game in a duopoly model of sequential innovation. We characterize the incentives to invest in R&D under two competing IPR regimes, which differ in their treatment of the follow-on innovations that become necessary because of pest adaptation. Depending on the magnitude of the R&D cost, ex ante firms might prefer an intellectual ...


Health Information And The Choice Of Fish Species: An Experiment Measuring The Impact Of Risk And Benefit Information, Stéphan Marette, Jutta Roosen, Sandrine Blanchemanche, Philippe Verger Jun 2007

Health Information And The Choice Of Fish Species: An Experiment Measuring The Impact Of Risk And Benefit Information, Stéphan Marette, Jutta Roosen, Sandrine Blanchemanche, Philippe Verger

CARD Working Papers

An experiment was conducted in France to evaluate the impact of health information on consumers' choice between two different types of fish. Successive messages revealing risks (methylmercury) and benefits (omega-3s) of consuming the fish, along with consumption recommendations, were delivered. Results show a significant difference of reaction according to the order and type of information. The information about risks had a larger marginal impact on change in willingness to pay (WTP) than did the information about benefits. While the results show that detailed messages on risks/benefits, including recommendations for nutrition behavior, matter in the modification of WTP, 40% of ...


Impact Of High Crop Prices On Environmental Quality: A Case Of Iowa And The Conservation Reserve Program, Silvia Secchi, Bruce A. Babcock May 2007

Impact Of High Crop Prices On Environmental Quality: A Case Of Iowa And The Conservation Reserve Program, Silvia Secchi, Bruce A. Babcock

CARD Working Papers

Growing demand for corn due to the expansion of ethanol has increased concerns that environmentally sensitive lands retired from agricultural production into the Conservation Reserve Program (CRP) will be cropped again. Iowa produces more ethanol than any other state in the United States, and it also produces the most corn. Thus, an examination of the impacts of higher crop prices on CRP land in Iowa can give insight into what we might expect nationally in the years ahead if crop prices remain high. We construct CRP land supply curves for various corn prices and then estimate the environmental impacts of ...


The Growth And Direction Of The Biodiesel Industry In The United States, Nicholas D. Paulson, Roger Ginder May 2007

The Growth And Direction Of The Biodiesel Industry In The United States, Nicholas D. Paulson, Roger Ginder

CARD Working Papers

The biodiesel industry in the United States has realized significant growth over the past decade through large increases in annual production and production capacity and a transition from smaller batch plants to larger-scale continuous producers. The larger, continuous-flow plants provide operating cost advantages over the smaller batch plants through their ability to capture co-products and reuse certain components in the production process. This paper uses a simple capital budgeting model developed by the authors along with production data supplied by industry sources to estimate production costs, return-on-investment levels, and break-even conditions for two common plant sizes (30 and 60 million ...


Welfare Impacts Of Cross-Country Spillovers In Agricultural Research, Sergio H. Lence, Dermot J. Hayes Apr 2007

Welfare Impacts Of Cross-Country Spillovers In Agricultural Research, Sergio H. Lence, Dermot J. Hayes

CARD Working Papers

The welfare implications of intellectual property protection (IPP) for private sector agricultural research are analyzed, focusing on the realistic cases in which countries provide different IPP levels, technology spills over across countries, and the public sector is involved in research. A model is developed to determine who benefits from, and who should pay for, the associated research. The paper contains some interesting results on the implications of a harmonization of IPP policies through multilateral agreements or via technology that allows research firms to prevent the copying of plants and animals that express traits that have emerged from their research.


Watching Corn Grow: A Hedonic Study Of The Iowa Landscape, Silvia Secchi Apr 2007

Watching Corn Grow: A Hedonic Study Of The Iowa Landscape, Silvia Secchi

CARD Working Papers

Landscape amenities can be scarce in places with large areas of open space. Intensely farmed areas with high levels of monocropping and livestock production are akin to developed open space areas and do not provide many services in terms of landscape amenities. Open space in the form of farmland is plentiful, but parks and their services are in short supply. This issue is of particular importance for public policy because it is closely linked to the impact of externalities caused by agricultural activities and to the indirect effects of land use dynamics. This study looks at the impact of landscape ...


Economic Aspects Of Agricultural And Food Biosecurity In The United States, David A. Hennessy Mar 2007

Economic Aspects Of Agricultural And Food Biosecurity In The United States, David A. Hennessy

CARD Working Papers

Concerns about biosecurity in the food system raise a variety of issues about how the system is presently organized, why it might be vulnerable, what one could reasonably do to better secure it, and the costs of doing so. After presenting some facts about US agriculture and food, this paper considers three economic aspects of the general problem. One is the global problem, or the way biosecurity measures can affect how countries relate to each other and the global consequences that result. Another is how to best manage the immediate aftermath of a realized threat in order to minimize damage ...


Green Payments And Dual Policy Goals, Hongli Feng Mar 2007

Green Payments And Dual Policy Goals, Hongli Feng

CARD Working Papers

We use a mechanism design framework to analyze the optimal design of green payment policies with the dual goals of conservation and income support for small farms. Each farm is characterized by two dimensions of attributes: farm size and conservation efficiency. Policymakers may not be able to use the attributes as an explicit criterion for payments. We characterize optimal policy when conservation efficiency is unobservable to policymakers, and when farm size is also unobservable. An income support goal is shown to reduce the conservation distortion caused by asymmetric information. The cost of optimal green payment mechanisms is shown to depend ...


Does Health Information Matter For Modifying Consumption? A Field Experiment Measuring The Impact Of Risk Information On Fish Consumption, Jutta Roosen, Stéphan Marette, Sandrine Blanchemanche, Philippe Verger Mar 2007

Does Health Information Matter For Modifying Consumption? A Field Experiment Measuring The Impact Of Risk Information On Fish Consumption, Jutta Roosen, Stéphan Marette, Sandrine Blanchemanche, Philippe Verger

CARD Working Papers

A field experiment was conducted in France to evaluate the impact of health information on fish consumption. A warning given to the treatment group revealed the risks of methylmercury contamination in fish and also gave consumption recommendations. Using difference-indifferences estimation, we show that this warning led to a significant but relatively weak decrease in fish consumption. However, consumption of the most contaminated fish did not decrease despite advice to avoid consumption of these types of fish. Accompanying questionnaires show that consumers imperfectly memorize the fish species quoted in the warning. The results point to the relatively poor efficacy of a ...


The Minimum Safety Standard, Consumers' Information, And Competition, Stéphan Marette Feb 2007

The Minimum Safety Standard, Consumers' Information, And Competition, Stéphan Marette

CARD Working Papers

This paper explores the effects of a standard influencing care choice. Firm(s) may increase the probability of offering safe products by incurring a cost. Under duopoly, they compete either in prices or in quantities. Under perfect information about safety for consumers, the selected standard that corrects a safety underinvestment is always compatible with competition. Safety overinvestment only emerges under competition in quantities and relatively low values of the cost. Under imperfect information about safety for consumers, the standard leads to a monopoly situation. However, for relatively large values of the cost, a standard cannot impede the market failure coming ...


The Soil And Water Assessment Tool: Historical Development, Applications, And Future Research Directions, Philip W. Gassman, Manuel R. Reyes, Colleen H. Green, Jeffrey G. Arnold Feb 2007

The Soil And Water Assessment Tool: Historical Development, Applications, And Future Research Directions, Philip W. Gassman, Manuel R. Reyes, Colleen H. Green, Jeffrey G. Arnold

CARD Working Papers

The Soil and Water Assessment Tool (SWAT) model is a continuation of nearly 30 years of modeling efforts conducted by the U.S. Department of Agriculture (USDA), Agricultural Research Service. SWAT has gained international acceptance as a robust interdisciplinary watershed modeling tool, as evidenced by international SWAT conferences, hundreds of SWAT-related papers presented at numerous scientific meetings, and dozens of articles published in peer-reviewed journals. The model has also been adopted as part of the U.S. Environmental Protection Agency’s BASINS (Better Assessment Science Integrating Point & Nonpoint Sources) software package and is being used by many U.S. federal ...


Get A Grip: Should Area Revenue Coverage Be Offered Through The Farm Bill Or As A Crop Insurance Program?, Nicholas D. Paulson, Bruce A. Babcock Jan 2007

Get A Grip: Should Area Revenue Coverage Be Offered Through The Farm Bill Or As A Crop Insurance Program?, Nicholas D. Paulson, Bruce A. Babcock

CARD Working Papers

The successful expansion of the U.S. crop insurance program has not eliminated ad hoc disaster assistance. An alternative currently being explored by members of Congress and others in preparation of the 2007 farm bill is to simply remove the “ad hoc” part of disaster assistance programs by creating a standing program that would automatically funnel aid to hard-hit regions and crops. One form such a program could take can be found in the area yield and area revenue insurance programs currently offered by the U.S. crop insurance program. The Group Risk Plan (GRP) and Group Risk Income Protection ...