Copyright (c) 2009 University of Nebraska - Lincoln All rights reserved. http://digitalcommons.unl.edu/ageconfacpub Recent documents in Faculty Publications: Agricultural Economics en-us Thu, 22 Oct 2009 23:17:59 PDT 3600 http://digitalcommons.unl.edu/ageconfacpub/91 http://digitalcommons.unl.edu/ageconfacpub/91 Wed, 21 Oct 2009 05:56:00 PDT Annual Department of Agricultural Economics Faculty Publication List (for 2008) http://digitalcommons.unl.edu/ageconfacpub/90 http://digitalcommons.unl.edu/ageconfacpub/90 Tue, 20 Oct 2009 14:47:56 PDT This study inquires into the spatial welfare impacts of a grain ethanol plant established in an area with a beef feeding industry. Beef feeders, corn farmers, and the ethanol plant interact with each other simultaneously in a dynamic market situation. To date, there are no studies which simultaneously analyze the welfare impacts of an ethanol enterprise on the three major players affected by the existence of a plant. In this market situation, some interesting phenomena have been noted which raise some intriguing questions. Why do plants sell ethanol byproduct feed at prices below corn price, even though studies show the byproduct to be a more valuable feed? Why does a plant, which could ship a non-perishable all over the world, choose instead to produce a perishable product? The answers to these questions are affected by the density of corn production, the density of beef production and the size of an ethanol plant in an area. This paper will shed some light on how these and other factors influence welfare and answers the questions posed above. The answers to these questions are important to the agents affected, but empirical evidence is not available on a sufficiently fine spatial grid to address them. Therefore the approach of this study is to construct a spatial equilibrium model to examine conditions that determine the distribution of welfare benefits from the existence of a plant. The model is driven by the plant's choice of prices for corn and byproduct so as to minimize net feedstock cost for the plant's capacity. These prices, and the welfare impacts on corn producers, feedlots and the plant itself, will depend upon transportation costs, the density of corn and beef production and the size of the plant. Justin Van Wart http://digitalcommons.unl.edu/ageconfacpub/89 http://digitalcommons.unl.edu/ageconfacpub/89 Tue, 28 Jul 2009 11:20:53 PDT Agricultural productivity growth in Chinese provinces during the 1994-2005 period is examined using two alternative approaches: a parametric stochastic frontier and a non-parametric Malmquist index. These models are suitable to the Chinese situation due to the existence of procurement prices, quotas, and other interventions that have distorted prices. Results show that there is high but declining productivity growth rates in the mid 1990's with productivity growth decreasing in the late 1990's but with a reversal of the trend around 1998 when growth rates start accelerating. A stochastic frontier translog production function is estimated to obtain an alternative measure of total factor productivity growth. Results are compared across these two models. Although average growth in technical change is similar in the two models, the regional rates are dissimilar. A model that includes three variables hypothesized to explain the difference in performance across regions is also estimated. The three variables included in the model are irrigation ratio, illiterate ratio and agriculture expenditure level. These variables make allowance for the difference of land and labor quality and the effect of public inputs. The irrigation ratio and agriculture expenditure are found to positively relate to the technical efficiency change and the illiterate ratio is found to negatively relate to the technical efficiency change. The results are consistent with expectations. Haizhi Tong http://digitalcommons.unl.edu/ageconfacpub/88 http://digitalcommons.unl.edu/ageconfacpub/88 Tue, 28 Jul 2009 11:20:51 PDT It has been commonly accepted that crop rotations reduce risk compared with monoculture systems. Quantifying this phenomenon requires that effects of yield stability on risk (positive or negative) arising from rotating crops be separated from other risk elements. Using an ARS-University of Nebraska series of yields for corn (Zea mays L.) and soybean [Glycine max (L.) Merr.] grown over a 14-yr period, both in rotation and in monoculture, the impact of crop rotation on risk was isolated and estimated. Risk was defined as the failure to meet an annual per-hectare net return target. A corn-soybean rotation had significantly less risk than monoculture practices. Diversification was found to contribute to part of this reduction while higher yields and reduced cost contributed to the remainder. This reduction in risk occurred even though the corn-soybean rotation had a higher yield variance. Glenn A. Helmers http://digitalcommons.unl.edu/ageconfacpub/87 http://digitalcommons.unl.edu/ageconfacpub/87 Wed, 27 May 2009 10:07:09 PDT We conducted two experiments in the context of environmental protection. We found that profit considerations and personality traits are among the essential determinants of individual contributions to the solution of environmental problems. The results show that environmental considerations are powerful motivators and subjects are willing to forgo pecuniary profits for the sake of "doing-the-right-thing". The study shows that the environmental groups can purchase carbon offsets directly from the providers at a lower-than market price and still obtain a relatively large market share. Natalia V. Ovchinnikova http://digitalcommons.unl.edu/ageconfacpub/86 http://digitalcommons.unl.edu/ageconfacpub/86 Mon, 20 Apr 2009 12:08:22 PDT Continuation of policy support for the US corn ethanol industry is being debated due to doubts about the greenhouse gas effects of the industry and the effects of the industry on food prices. Yet there is no publicly available data on the economic and technical performance of the current generation of plants, which constitute the overwhelming majority of the industry. This study helps to fill that gap. Seven recently constructed ethanol plants in seven Midwest US states provided details on input requirements and operating costs during 2006 and 2007. Results show that technical performance is substantially better than current estimates available in the literature. Average net operating returns exceeded capital costs during the survey period, but price changes by mid-2008 reduced these margins to near zero. While the economic performance of the industry is currently viable, this study demonstrates that it can be threatened by current price trends, and certainly would be in the absence of current subsidies. Richard K. Perrin http://digitalcommons.unl.edu/ageconfacpub/85 http://digitalcommons.unl.edu/ageconfacpub/85 Mon, 20 Apr 2009 12:08:20 PDT This study inquires into the spatial welfare impacts of a grain ethanol plant established in an area with a beef feeding industry. Corn producers will benefit, but by how much? Why do plants seem to price their animal feed byproduct so low that beef producers may benefit from lower feed costs, despite the higher corn price? Why do ethanol plants in some areas dry all their byproduct feed while in other areas plants sell it all in wet form? How are these outcomes affected by the density of corn production, by the density of feedlots, and by the size of the ethanol plant? The answers to these questions are important to the agents affected, but empirical evidence is not available on a sufficiently fine spatial grid to address them. Therefore the approach of this study is to construct a spatial equilibrium model to examine conditions that determine the distribution of welfare benefits from the existence of a plant. The model is driven by the plant's choice of prices for corn and byproduct so as to minimize net feedstock cost for the plant's capacity. These prices, and the welfare impacts on corn producers, feedlots and the plant itself, will depend upon transportation costs, the density of corn and beef production and the size of the plant. Justin Van Wart http://digitalcommons.unl.edu/ageconfacpub/84 http://digitalcommons.unl.edu/ageconfacpub/84 Mon, 20 Apr 2009 12:08:19 PDT Forward pricing behavior of random samples of Indiana, Nebraska, and Mississippi crop producers was analyzed using Heckman's two-step limited information maximum likelihood estimation procedure. Producers who forward priced during the 1995-1998 period generally expected to forward price in 1999 using similar techniques. Probit models were estimated for cash forward contracts and taking a direct position in futures or options separately and combined. Results provide limited support for the hypothesis that forward pricing should be analyzed as an adoption decision. Variables reflecting risk attitudes do affect the decision to use forward pricing, while variables related to economic position affect the level of forward pricing. Todd Davis http://digitalcommons.unl.edu/ageconfacpub/83 http://digitalcommons.unl.edu/ageconfacpub/83 Tue, 31 Mar 2009 12:07:45 PDT One benefit of conservation tillage practices is an increase in soil moisture. The paper combines panel data techniques with spatial analysis to measure the impact of extreme weather events on the adoption of conservation tillage. Zellner's SUR technique is extended to spatial panel data to correct for cross-sectional heterogeneity, spatial autocorrelation, and contemporaneous correlation. Panel data allows the identification of differences in adoption rates as a function of the severity of past drought or flood events. The adoption of no-till, alternative conservation tillage, and reduced till are estimated relative to conventional tillage. Extremely dry conditions in recent years are found to increase the adoption of both no-till and other conservation tillage practices; while extremely wet conditions (i.e., floods) do not have a significant effect on the choice of tillage practice. In addition, spring floods are found to significantly reduce the use of conservation tillage practices. Ya Ding http://digitalcommons.unl.edu/ageconfacpub/82 http://digitalcommons.unl.edu/ageconfacpub/82 Mon, 16 Feb 2009 13:22:37 PST Crop traits are durable when embedded in varieties, and thus they may be subject to Coase's conjecture that monopolists who sell durables may be unable to earn normal monopoly rents, or in the extreme case, not any rents at all. To determine the potential relevance of this conjecture for the crop traits market, we analyze the theoretical time path of trait prices under three systems of intellectual property rights (utility patents, plant breeders' rights, and none), alternative assumptions about sellers' ability to commit to future action, and alternative assumptions that buyers are either myopic or far-sighted with respect to expectations about the future price of the durable. Under only one of these stylized circumstances does the Coase conjecture have traction, but it is a plausible circumstance in much of the world - owners with plant breeders' rights, buyers with foresight, sellers unable to commit to future price paths. In this circumstance, this theory suggests that sellers holding only plant breeders rights would realize only 11% of potential social welfare benefits from the trait, while farmers and/or downstream consumers would realize about 85%. On the other hand, with myopic buyers under any system of intellectual property rights, temporal price discrimination is feasible, resulting in above-normal monopolist welfare (about 70% of maximum social welfare benefits) and little damage to consumers relative to normal monopoly pricing. Richard K. Perrin