Testing the Integration of U.S.–Canadian Meat and Livestock Markets

Price transmission is a critically important issue that affects market enlargement and the unification of Canadian–U.S. agriculture. This study adopts alternative frameworks to examine the nature of cross‐border integration in selected meat and livestock markets. The aim is to determine the extent to which selected meat and livestock markets transmit price signals across the international border using time‐series data through 2001. Typically, price‐based studies examining market integration across countries ignore important spatial and temporal factors affecting commodity price relationships such as adjustments lags, changes in the value of national currencies, and policy‐induced trade barriers. Here, we account for such factors in our two model specifications. The first model is based upon the law‐of‐one price (LOP) framework and focuses on spatial efficiency. The second analytical framework is the vector autoregressive (VAR) model that highlights the dynamic notion of market connectedness. The LOP analysis permits us to formally test the existence of perfect market integration and complete market segmentation. The VAR analysis enables us to gauge price‐shock transference. Empirical evidence is generated confirming that the two national markets for whole chicken are segmented, a not unsurprising finding given that poultry is a supply managed sector in Canada. The Canadian–U.S. hog‐ and pork‐product markets were found to be more integrated than the Canadian–U.S. steer‐ and beef‐product markets. Evidence is also provided showing that the Canadian–U.S. exchange rate inhibits cross‐border integration in these commodity markets. La transmission des prix est un sujet extrêmement important qui gêne l'expansion des marchés et l'unification de l'agriculture du Canada et des États‐Unis. Dans la présente étude, nous avons utilisé divers cadres d'analyse pour examiner la nature de l'intégration transfrontalière de marchés sélectionnés de la viande et des bestiaux. L'objectif consistait à déterminer l'étendue avec laquelle des marchés sélectionnés de la viande et des bestiaux transmettent des signaux de prix au‐delà des frontières en utilisant des données de séries chronologiques jusqu'en 2001. Généralement, les études de prix qui examinent l'intégration des marchés entre les pays font abstraction de facteurs spatiaux et temporels importants touchant le rapport des prix des produits de base tels que le décalage dans les rajustements, la variation du cours des devises nationales et les obstacles au commerce induits par les politiques. Dans le présent article, nous avons tenu compte de ces facteurs dans les spécifications de deux modèles. Le premier est modèle fondé sur la loi du prix unique qui met l'accent sur l'efficacité spatiale. Le deuxième est un modèle d'autorégression vectorielle (VAR) qui met en évidence la notion dynamique de la connexité des marchés. Le modèle fondé sur la loi du prix unique nous a permis de vérifier l'existence de l'intégration parfaite et de la segmentation totale des marchés. Le modèle d'autorégression vectorielle nous a permis d'évaluer le transfert d'un choc de prix. L'évidence empirique a confirmé que les deux marchés nationaux du poulet entier étaient segmentés, un résultat qui n'est pas sans surprise compte tenu que l'élevage du poulet au Canada est un secteur soumis à la gestion de l'offre. Nous avons trouvé que les marchés canado‐américains des porcs et de la viande porcine étaient plus intégrés que les marchés canado‐américains des bovins et de la viande bovine. L'évidence empirique a également montré que le taux de change entravait l'intégration transfrontalière de ces marchés de produits de base.     

A Spatial Equilibrium Analysis of U.S.–Canadian Disputes on the World Softwood Lumber Market

This paper utilizes a world spatial equilibrium model to examine the effects of U.S.–Canadian softwood lumber disputes on U.S., Canadian, and other exporters' and importers' lumber markets. Results show that the U.S. import tariff on Canadian softwood lumber impacts prices, supply, demand and trade flows not only in the United States and Canada but also in the other countries. Though the goal of U.S. trade restriction is to limit imports from Canada and protect its producers, the United States cannot fully accomplish this goal as non-Canadian exporters fill the void left by the reduced imports from Canada. Canadian producers lose from the U.S. policy, but their loss is mitigated as Canada redirects its exports to other importers. Importing countries such as Japan and the European Union benefit from the U.S. trade restrictions as Canada seeks to sell its softwood lumber to these countries.     

Canadian Dietary Fat Substitutions, 1955–93, and Coronary Heart Disease Costs

In this paper, we use a prevalence-based, cost-of-illness approach to estimate the impact of change in dietary fat intake on coronary heart disease (CHD) costs in Canada. To this end, we review the clinical studies that have examined the relationship between fatty acid consumption and serum cholesterol levels. We estimate the increase in consumption of less saturated vegetable oils, which displaced some of the animal fats in the Canadian diet between 1955 and 1993, was responsible for an estimated 10.1% reduction in the incidence of CHD in Canada. This implies ex post a $832 million reduction in direct and indirect CHD costs in 1993. To put it another way, if Canadians had retained their 1955 diet in 1993, CHD costs would have been $832 million greater. Since many of these costs are external to marketplace, the magnitude of these numbers suggests a need to include health costs in the economic analysis of policies that affect fatty acid intake.     

The Labor Market for New Agricultural and Natural Resource Economics Ph.D.s

We describe the characteristics and labor market experiences of new agricultural and natural resource economics Ph.D.s. Women earned roughly 27% of the Ph.D.s earned during 1996–97 and 2001–02; 36% of the Ph.D.s awarded were earned by U.S. citizens. About half of the employed graduates found jobs in academe, with the remainder divided roughly equally among government, international or research organizations, business, industry, and consulting. The median salary of new Ph.D.s holding full-time jobs in the United States was $62,500 in 2002, up from $47,500 five years earlier.     

On the Relationship between the Student–Advisor Match and Early Career Research Productivity for Agricultural and Resource Economics Ph.D.s

We use a unique data set on students receiving their Ph.D.s from top-ranked agricultural and resource economics programs to investigate how the ranking of a student's dissertation advisor affects his or her early career research productivity. After controlling for program reputation, we find that the higher the relative research productivity of a student's dissertation advisor the greater the student's early career research productivity. Allowing the estimated effects of advisor rank to vary with program reputation suggests that students from lower-ranked programs working with relatively more prominent advisors outperform their peers at highly ranked programs working with less prominent advisors.