The Impact of Generic Advertising on U.S. Household Cheese Purchases: A Censored Autocorrelated Regression Approach

The impacts of generic cheese advertising on U.S. household cheese purchases are examined via the use of a unique household panel. Modest gains in overall at-home cheese purchases from generic cheese advertising appear to be largely the result of strong gains in purchases of natural cheese rather than processed cheese. Results indicate that relatively larger gains in household cheese purchases from generic advertising may be realized by targeting infrequent purchasers to increase purchase frequencies, rather than by targeting households in general to increase their conditional purchase levels.     

A Dynamic Regression Model of the U.S. Hog Market

Historical patterns of hog slaughterings are analyzed and related to a hog-corn price ratio series using the transfer function or dynamic regression technique. This technique permits explicit tests of causal relationships and provides a systematic means for specifying distributed lag forms. It is determined that the hog-corn price ratio series leads hog slaughterings and that there is no feedback. The estimated transfer function is analyzed in terms of its implications for the supply of hogs and its implications for the length of the hog cycle.
Nous analyserons les schémas historiques de l'abattage de pores et Us mettrons en correspondence avec une série de rapportsprix du porc —prix du maïs en ulilisant lafonction de transfert ou la technique de regression dynamique. Cette technique permet de tester explicitement les relations causales et foumit un moyen systématique de spécifier les formes de retard distribué. On a determine que Vabattage de pores dépend de la série de rapports prix du pore —prix du maïs mais que I'inverse n'est pas vrai. La fonction de transfert est analysée en fonction de ce qu'elle impliquepour I'approvisionnement en pores et pour la longueur du cycle chez les pores.     

Estimating the U.S. Import Demand for Melons: A Dynamic Analysis Approach

The United States is one of the world's leading consumers as well as one of the world's leading producers of melons. However, U.S. melons are produced only from May through December. In order to supplement the domestic demand and make melons available year-round, the United States imports melons from Latin American countries. This article analyzes the U.S. demand for imported fresh and frozen melons using monthly data on import volumes and values. A static and a dynamic linear Almost Ideal Demand System are estimated using Seemingly Unrelated Regression (SUR). The estimated parameters are used to estimate the short- and long-run price and expenditure elasticities.     

A new market for an old food: the U.S. demand for olive oil

While U.S. consumption of olive oil has tripled over the past two decades, nearly all olive oil continues to be imported. Estimation of a demand system using monthly import data reveals that the income elasticity for virgin oils sourced from EU is above one, but demand for nonvirgin oils is income‐inelastic. The demand for olive oil as a single product is price‐inelastic. Differentiated by product characteristic and origin, olive oils are highly substitutable with each other but not with other vegetable oils. News about the health and culinary benefits of olive oil and the spread of Mediterranean diet contribute significantly to the rising demand.     

Stochastic Biases in Technical Change in U.S. Agriculture: A Bootstrap Approach

Having argued that the modeling of technical change as a smooth deterministic function of time is likely to misrepresent the true nature of technical change, this paper reexamines biased technical change in U.S. agriculture using a system of share equations with unobserved components errors, with technology treated as a stochastic unobserved variable. Employing data to represent the aggregate output and input of the U.S. agricultural sector over the period 1947–94, significant factor biases were found that appear to be linearly independent and do not appear to be smooth and deterministic. Technical change in U.S. agriculture appears to have been biased toward saving expenditure on labor at the expense of expenditure on intermediate inputs, with some small saving on the expenditure on capital inputs over the entire period 1947‐94. The paper also employs a bootstrapping approach in order to obtain finite sample tests with approximately the correct size under less stringent assumptions about the data generating process than assumed by maximum likelihood (ML) based approaches. Using these finite sample values significantly alters the conclusions reached regarding the nature of technical change. Après avoir démontré que la modélisation du changement technique par une fonction lissée déterministe du temps peut ne pas représenter correctement sa vraie nature, cet papier re‐examine le biais du changement technique dans l'agriculture américaine à partir d'un systè d'équations de parts avec des erreurs non observées et une technologie traitée comme une variable stochastique non observée. A partir de données représentant la production et les intrants agrégés dans le secteur agricole américain sur la période 1947–1994, nous constatons que les biais significatifs sont indépendants linéairement et qui ne sont pas des fonctions déterministes lissées du temps. Le changement technique dans l'agriculture américaine est biaisé en faveur des réductions de dépenses de travail aux dépends des dépenses sur les intrants intermédiaires et montre quelques économies sur les dépenses de capital sur la période 1947‐1994. L'emploi des techniques de bootstrapping permet d'obtenir des tests sur échantillons finis avec des hypothèses moins exigeantes que celles imposées par les approches de maximum de vraisemblance. Les conclusions obtenues à partir de ces tests sont significativement différentes que celles obtenues par les méthodes traditionnelles concernant le changement technique.     

Agricultural Trade among NAFTA Countries: A Case Study of U.S. Meat Exports

The U.S. NAFTA partners are important markets for U.S. meat exports. A source-differentiated almost ideal demand system is used in this study to estimate meat demand in Canada and Mexico. Empirical results suggest that while a U.S. price increase in the Canadian market is expected to increase U.S. sales revenues; it would decrease sales revenues in the Mexican market. Furthermore, an increase in meat expenditures in Canada and Mexico is expected to increase the demand for U.S. meats, while the bovine spongiform encephalopathy outbreaks have had a negative effect on U.S. and Canadian beef market shares. Finally, a decomposition of the causes of changes in demand for U.S. meats over time is performed.     

Nonlinear Dynamics and Structural Change in the U.S. Hog–Corn Cycle: A Time-Varying STAR Approach

The linearity of the U.S. hog–corn cycle has been questioned by Chavas and Holt (1991) . Even so, attempts have not been made to model the potential nonlinear dynamics in the hog–corn cycle by using regime-switching models. One popular alternative is Teräsvirta's smooth transition autoregressive (STAR) model, which assumes regime switching is endogenous and potentially smooth. In this article, we examine monthly data for the U.S. hog–corn cycle, 1910–2004. A member of the STAR family, the time-varying STAR, is fitted to the data and its properties examined. We find evidence of nonlinearity, regime-dependent behavior, and time-varying parameter change.     

A Political Economic Analysis of U.S. Rice Export Programs to Japan and South Korea: A Game-Theoretic Approach

The Uruguay Round Agreement on agriculture has contributed to the increase in U.S. and world rice trade since 1994. Despite this, the Japanese and Korean rice markets continue to be characterized by high levels of trade intervention. This article attempts to analyze both import markets incorporating econometric estimates and public choice theory in a game-theoretic framework. Various scenarios are analyzed. The results show that the overall Nash equilibrium occurs with a 4% tariff reduction for Japan and Korea under the U.S. Market Development Program, which includes the Market Access Program and Foreign Market Development Program.     

A Political Economic Analysis of U.S. Rice Export Programs to Japan and South Korea: A Game Theoretic Approach

The Uruguay Round Agreement on agriculture (UR) has contributed to the increase in U.S. and world rice trade since 1994. Despite this, the Japanese and Korean rice markets continue to be characterized by high levels of trade intervention. This paper attempts to analyze both import markets incorporating econometric estimates and public choice theory in a game theoretic framework. Various scenarios are analyzed. The results show that the overall Nash equilibrium occurs with a 4% tariff reduction for Japan and Korea under the U.S. Market Development Program, which includes the Market Access Program and Foreign Market Development Program.     

Estimating Investment Rigidity within a Threshold Regression Framework: The Case of U.S. Hog Production Sector

This article addresses the issues of investment/disinvestment asymmetry and a possible existence of a sluggish regime in the demand for a quasi-fixed input in the U.S. hog production sector. Adopting a new threshold estimation procedure, quarterly data from 1970 through 2002 are used to estimate a regime-dependent investment demand equation for a quasi-fixed input, taking sows as a proxy. The results support the existence of three regimes over alternative specifications precluding the sluggish regime, confirming the existence of asset fixity in hog production. The results also highlight the importance of accounting for investment rigidity when estimating hog supply and variable input demands.     

Determinants of economic well-being among U.S. farm operator households

Participation in government programs has a mild impact on the economic well‐being of U.S. farm households. Major factors that determine farm household prosperity are the primary operator's education level and ethnicity, education level of the spouse, and other characteristics such as forward purchasing of inputs, use of contract shipping of products, having a succession plan, farm ownership, and location in a metro area. This article uses the 2001 Agricultural Resource Management Survey (ARMS) as well as relative and an absolute measure to assess U.S. farm households' economic well‐being. The relative measure compares the income and wealth position of farm households relative to median income and median wealth of the general population. The absolute measure adds annualized wealth to a farm household's income.     

Factors Affecting the Allocation of Trade Promotions in the U.S. Food Distribution System

Although many have proposed theories explaining trade promotion (TP) behavior by manufacturers, lack of data has prevented empirical assessment. We employ survey data to explore the effect of manufacturer and retailer bargaining power on the allocation of TPs in the U.S. food sector. The survey respondents consist of retailers controlling 40% of retail sales in U.S. supermarkets. Retailer bargaining power increases the allocation of funds to off-invoice TPs through higher share of private label and retailer size. Manufacturer bargaining power decreases the allocation of funds to off-invoice TPs by establishing formal policies of negotiation.     

A Microeconometric Analysis of the U.S. Meat Demand

Price and expenditure elasticities and estimates of the effect of household demographic variables on U.S. meat demand are estimated using the newly released 1987–88 USDA household food consumption survey data. The USDA survey for the first time included variables reflecting respondents' concerns for health and diet information. A hybrid demand system, which combines a modified generalized addilog system and a level version Rotterdam demand system, is developed as the analytical framework. The micro econometric analysis takes into consideration the consumer selection problem, the missing-price problem, and the aggregation and quality variation problem. The most significant household characteristic and socio-economic variables are region, ethnic background, household size, urbanization, food planner, received health information, female household head employment status and proportion of food expenditure on away-from-home consumption. The results support the speculation of other time-series meat demand studies claiming both health concerns and convenience are the reasons for changes in consumer preference in favor of poultry and fish and in disfavor of red meat.     

A Quantile Regression Analysis of the Effect of Farmers’ Attitudes and Perceptions on Market Participation

The objective of this study is to investigate the subjective determinants of farmers’ participation in output markets in five EU New Member States (NMS) characterised by large semi‐subsistence sectors. It employs quantile regression to model market participation reflecting the heterogeneity amongst farmers. The study also uses the Bayesian adaptive lasso to simultaneously select important covariates and estimate the corresponding quantile regression models. The empirical results show that only two variables affect all quantiles, while their effect varies across quantiles. Some of the remaining variables affect the share of output sold at the lower quantiles (i.e. for subsistence‐ and semi‐subsistence‐oriented farmers) only, whereas other variables are only significant at the upper quantiles (i.e. for more commercially oriented farms). Advisory services, and particularly agricultural business advice, and information and advice on markets and prices can facilitate the market participation of subsistence‐oriented farms.     

The behavioural economics of health protection: an empirical evidence of moral hazard in U.S. hog farms

Healthy workers are productive. When firms could not pay according to worker's health preventative effort levels due to asymmetric information, they provide an incentive contract to cope with the moral hazard problem. We test the existence of ex ante moral hazard in the U.S. hog farms. Using a national employee survey data in 1995 and in 2000, we find that even though employers provide protective devices to reduce the negative effects of poor environmental conditions on employees’ respiratory health, many employees do not wear the devices, which is consistent with the moral hazard behaviours. The probability of using a protective device is 10 per cent lower in the farms with an agency problem than in family farms without an agency problem, even after we control for medical insurance provision types. Reducing pollutants, providing protective devices and instilling the importance of using masks help to alleviate moral hazard incidences.     

Congestion and Distribution of Rents in Wheat Export Sector: A Canada–U.S. Cross‐Border Comparison

In Canada, average grain freight rates are regulated via the Maximum Revenue Entitlement (MRE), while on the US side of the border grain rates are subject to very little oversight. We use this natural experiment to explore how the MRE regulation has impacted freight rates and the distribution of rents in the wheat supply chain since 2012. On both sides of the border, when large crops have exceeded the short‐term capacity of grain export channels to move the crop, export basis has increased and reduced producer prices. In locations not subject to barge competition, US grain freight rates are higher than Canadian rates and are bid up further during periods of congestion. In Canada, MRE regulation redistributes rents away from railways toward grain companies and producers. These higher grain handling margins have increased the incentives to build additional port terminal capacity in the post‐CWB single desk environment. Au Canada, les tarifs marchandises moyens des céréales sont règlementés par le Revenu admissible maximal (RAM), tandis qu'aux États‐Unis, les tarifs céréaliers font l'objet de très peu de suivi. Au moyen de cette expérience naturelle, nous explorons l'impact du RAM sur les tarifs marchandises et sur la distribution des rentes dans la chaine d'approvisionnement du blé depuis 2012. Des deux côtés de la frontière, lorsque de vastes cultures ont excédé la capacité à court terme des voies d'exportation céréalières pour distribuer leurs récoltes, le seuil d'exportation augmente et réduit les prix des producteurs. Là où ils ne sont pas assujettis à la compétition de barges, les tarifs marchandises céréaliers américains s'avèrent plus élevés que les tarifs canadiens et se voient encore surenchéris lors de période de congestion. Au Canada, la règlementation du RAM redirige les rentes des compagnies ferroviaires aux entreprises et producteurs céréaliers. Ces marges de manutention plus élevées ont augmenté les incitatifs pour accroître la capacité des ports‐terminaux dans un environnement à pupitre unique, post Commission canadienne du blé.     

U.S. corn exports: the role of the exchange rate

Time series econometric methods are applied to monthly observational data over the period 1978-1942 on real exchange rates, real corn prices, corn export sales, and corn export shipments for the United States. In-sample fit and out-of-sample forecast results are used to discern whether exchange rates have elicited systematic responses in U.S. corn prices, sales and shipments, and whether the dynamic transmission mechanisms tying these variables together have changed over time. A structural break appears to have occurred in early 1985. No cointegration is found between exchange rates, price, sales, and shipments in either sub-period. Influences are all short-run or between stationary variables. The role of the exchange rate appears to have moderated in the post-1985 period. Implications for policy analysis are discussed.