Using advanced methods of directed acyclic graphs with Bernanke structural vector autoregression models, this article extends recent econometric research on quarterly U.S. markets for wheat and wheat-based value-added products downstream. Analyses of impulse response simulations and forecast error variance decompositions provide updated estimates of market elasticity parameters that drive these markets, and updated policy-relevant information on how these quarterly markets run and dynamically interact. Results suggest that movements in wheat and downstream wheat-based markets strongly influence each other, although most of these effects occur at the longer-run horizons beyond a single crop cycle.

Regulatory changes by federal and state agencies portend a switch from nitrogen-based livestock manure disposal policies to phosphorus-based policies. This paper estimates the compliance costs of such a policy change for a hypothetical hog-grain farm in North Central Indiana. The farm includes 1,500 acres of cropland and has the capacity to raise 11,970 grow-finish hogs annually. The farm model also has the potential to produce four different crops on six different land types. A nonlinear math-programming model was developed to determine the optimal mix of management activities for a phosphorus-based regulation. The model allows mitigation of compliance costs via the choice between four different pig diets, three alternative methods of manure disposal, changes in timing of manure application, and crop pattern adjustments. This analysis concludes that the new regulation will result in a decrease in whole-farm returns above variable costs, the use of phytase enzyme in pig diets, and an increase in wheat acreage. The model also reveals that it is optimal for the farmer to hire a custom hauler to assist in application of manure in an effort to reduce the degree to which available field days constrain farming activities and land application of manure. The estimated cost to the farmer, as a result of the policy change, ranges between $0.56 and $21.74 per unit of pig production capacity.

An important aspect of structural change in the U.S. hog industry has been the adoption of breeding technology. The adoption of each of four breeding technologies, weekly farrowing, intensive breeding, terminal crossbreeding, and artificial insemination, in U.S. hog production is analyzed using multivariate probit analysis. Results suggest that diversification, whether the producer raised breeding stock, debt and asset levels, and producer's education influence adoption rate. Larger, more risk-averse producers were more likely to adopt technology. Producers who rated the quality of labor available as higher were more likely to adopt management-intensive technologies.

This paper reports import demand elasticities for environmental goods and services (EGS) for the world in aggregate and for six world regions. The paper involves a pooled cross-section and time-series estimation procedure and makes per capita demand for EGS a function of economic, political, and structural factors. The results show that per capita incomes, exchange rates, political and economic freedoms, and debt affect the demand for EGS. The results also show that demand for EGS is tied to the particular environmental problem facing a particular region. Exporters of EGS need to disaggregate world markets to better target products.

Meta-analysis is used to quantitatively summarize previous studies of residential electricity demand to determine if there are factors that systematically affect estimated elasticities. In this study, price and income elasticities of residential demand for electricity from previous studies are used as the dependent variables, with data characteristics, model structure, and estimation technique as independent variables, using both least square estimation of a semilog model and maximum likelihood estimation of a gamma model. The findings of this research can help better inform public policy makers, regulators, and utilities about the responsiveness of residential electricity consumers to price and income changes.

The Conservation Reserve Program (CRP) takes cropland out of production for 10 years, reducing grain supplies available to elevators. Results suggest that the program has negatively impacted elevator merchandising margins, but that elevators adjusted rather quickly to CRP changes, making most of the adjustment within 1 year. The reduction in margins reflects an element of pressure on agribusinesses that has not been measured in previous studies.

As the farm-to-retail price spread continues to grow, some cattle producers are beginning to consider integrating into the retail sector. Such a venture would require large investments in capital with uncertain return. This study seeks to determine the potential success of a stand-alone retail outlet selling “all natural” beef in an affluent area of Jackson, MS. Using choice-based conjoint analysis, demand for the new retail outlet is modeled as a function of the beef price at the store, distance of the store from consumers' homes, distance of the store from consumers' typical grocery store, and price of beef at substitute grocery stores. Simulation results suggest the proposed outlet could be a profitable venture, depending upon location and beef price.

A residual demand model for beef exports to Japan is specified and estimated. The objective is to estimate the extent of market power. It is assumed that each exporting country faces a downward-sloping residual demand curve, which reflects the market demand minus the supplies of competitors, and that exporters maximize profit through their output decisions. The analysis is disaggregated by beef cut and form to capture the variation by beef market segments. The results indicate that the highest markup of price over marginal cost belongs to U.S. frozen ribs, the only indication of market power by U.S. exporters. Canada is found to have limited market power, whereas Australia and New Zealand enjoy some market power, including five chilled beef categories.

Attitudes of Japanese consumers toward domestic and foreign varieties of rice were analyzed on the basis of a survey. We found that the current retail prices for imported rice are higher than the average consumers' willingness-to-pay (WTP), whereas most domestic rice was priced below the average WTP. Unfamiliarity or negative perceptions of the safety and flavor of foreign rice lowered WTP substantially. The WTP for U.S. rice was limited more by negative perceptions of flavor than from concerns about food safety.

Probit analysis identified factors that influence the adoption of precision farming technologies by Southeastern cotton farmers. Younger, more educated farmers who operated larger farms and were optimistic about the future of precision farming were most likely to adopt site-specific information technology. The probability of adopting variable-rate input application technology was higher for younger farmers who operated larger farms, owned more of the land they farmed, were more informed about the costs and benefits of precision farming, and were optimistic about the future of precision farming. Computer use was not important, possibly because custom hiring shifts the burden of computer use to agribusiness firms.

Conjoint analysis is used to measure the preferences of United States consumers for labeling of biotech foods. The study found that consumers in the sample support mandatory labeling of biotech foods. This suggests that U.S. consumers would support revisions to the present voluntary labeling policy of the U.S. Food and Drug Administration and the U.S. Department of Agriculture. Results also showed that the preferred labeling format is a text disclosure that describes the benefits of biotechnology in combination with a biotech logo.

Preconditioning calf programs, while not new, are becoming more prevalent. They provide benefits to cow-calf producers while adding value for feeder cattle buyers. However, questions remain regarding the economic costs and returns of such programs. A model was estimated with data from three consecutive-day sales, to determine the value that buyers place on preconditioning programs and related feeder cattle traits. Our results indicate that price premiums, although evident, appear to be insufficient by themselves to cover the marginal costs of preconditioning.

The present study examines technical efficiency patterns in Ukraine's crop sector for 1991-1996. The economic and policy environment in Ukraine has changed since reform began in 1991. Many policy changes have exerted offsetting economic pressures on efficiency. Enterprise privatization and the liberalization of prices and trade put upward pressure on technical efficiency, whereas start-stop land privatization efforts, unpredictable government intervention, and slow developments in the credit and labor markets put downward pressure on efficiency. We found that technical efficiency appears to have improved slightly over the 1991-1996 period, suggesting that the positive forces had more impact.

Interactions among the nitrogen (N) fertilization rate, N source, and disease severity can affect mean yield and yield variance in conservation tillage wheat production. A Just-Pope model was used to evaluate the effects of N rate, N source, and disease on the spring N-fertilization decision. Ammonium nitrate (AN) was the utility-maximizing N source, regardless of risk preferences. The net-return-maximizing AN rate was 92 lb N/acre, providing $0.52/acre higher net returns than the best alternative N source (urea). If a farmer could anticipate a higher-than-average Take-All Root Rot infection, the difference in optimal net returns between AN and urea would increase to $35.11/acre.

We attempt to value health risks by combining traditional demand impact analysis with direct elicitation of individuals' risk perceptions of food safety. We examine the impact of multiple risks of related goods on consumption of a risky good. We argue that the consumption of a risky good depends on both its absolute risk level and its relative risks to other risky goods. Seafood consumption in eastern North Carolina was studied. We elicited, in a survey, individual perceived risks as reference points to derive the economic value of reducing health risk in seafood consumption. Revealed and stated data were combined to trace out demand changes in response to absolute and relative risk reductions. Our results show that seafood consumption is affected by the perceived absolute risk and by the relative risk to poultry and that individuals react to the multiple risks in a nonlinear way, as was suggested by our analytical model.

This study examines the adoption of best-management practices (BMPs) in terms of the total number of practices implemented up to a certain period, using count data analysis. Poisson and negative binomial regressions were used to examine the likely determinants of producers' decisions to adopt greater numbers of technologies, and the specific case of dairy producers' adoption of BMPs was explored. Our results emphasize the significant effect of producers' awareness of the efforts to control non-point source pollution, information about BMPs, farm size, producer's educational attainment, and risk aversion on the number of BMPs adopted.

The study analyzes the effect of risk aversion on the optimal level of fertilizer by employing a pooled time-series cross-sectional survey data collected from 46 rainfed rice farmers in Tarlac, Central Luzon, Philippines. Based on a heteroscedastic specification of production function, fertilizer was found to be a risk-increasing input, but the effect of risk aversion on the optimal fertilizer use was estimated to be moderate. Explanations for the low average rate of application of fertilizer under rainfed conditions thus need to be found elsewhere.

A recent study by Miljkovic, Marsh, and Brester estimates that reductions in the Japanese tariff-rate quota between 1993 and 2001 increased U.S. beef prices by $1.03 per cwt and yen depreciation between 1995 and 1998 reduced U.S. hog prices by $0.99 per cwt. Relaxing the assumption that U.S. beef and hog supplies are fixed cuts the total elasticities underlying these estimates by 50% or more. The upshot is that shocks in the Japanese market have little effect on U.S. beef and pork prices. Hence, producers may be better off focusing on domestic issues such as dietary concerns over red meat consumption.

In responding to a comment article, we concur that quantifying U.S. livestock price response to changing Japanese meat import demand requires nonzero supply elasticities beyond one quarter. However, rigidities in market trade and empirical tests justify the inclusion of exchange rates in the short-run analysis. Producer welfare asymptotically approaches zero for increasing supply elasticities in the long run, but short-run transitions in producer surplus are meaningful to producers.