Impact of BSE on Beef Purchases in Alberta and Ontario Quick-Serve Restaurants

This analysis employed a highly disaggregated household data set of Alberta and Ontario fast food purchases from May 2000 to May 2005. A double-hurdle count data model allowed tests of the hypotheses that frequency of Bovine spongiform encephalopathy ( BSE) media coverage affected neither a household's monthly probability of purchasing a beef entree, nor the household's monthly quantity of beef entrees purchased. Ontario consumers were more likely to stop purchasing beef entrees immediately following a surge in BSE media coverage, but those who did buy beef entrees maintained stable quantity levels. BSE media coverage did not systematically affect fast food purchases among Alberta consumers .
Dans la présente analyse, nous avons utilisé un ensemble de données fortement désagrégées sur les achats de repas–minute effectués par des ménages de l'Alberta et de l'Ontario, entre mai 2000 et mai 2005. Un modèle de comptage à deux étapes (double hurdle count data model) a permis de vérifier les hypothèses selon lesquelles la concentration de la couverture médiatique de la crise de l'ESB n'influence pas la probabilité mensuelle d'un ménage d'acheter des repas–minute de bœuf ni la quantité mensuelle de repas–minute de bœuf achetés par un ménage. Les consommateurs ontariens étaient plus susceptibles de cesser d'acheter des repas–minute de bœuf immédiatement après une poussée de la couverture médiatique de la crise de l'ESB, mais ceux qui achetaient des repas–minute de bœuf ont maintenu les quantités achetées. La couverture médiatique de la crise de l'ESB n'a pas systématiquement influencé les achats de repas–minute chez les consommateurs albertains .     

Assessing the Impact of the ‘Decoupling’ Reform of the Common Agricultural Policy on Irish Farmers’ Off‐farm Labour Market Participation Decisions

This paper assesses the impact of the ‘decoupling’ reform of the Common Agricultural Policy on the labour allocation decisions of Irish farmers. The agricultural household decision‐making model provides the conceptual and theoretical framework to examine the interaction between government subsidies and farmers’ time allocation decisions. The relationship postulated is that ‘decoupling’ of agricultural support from production would probably result in a decline in the return to farm labour but it would also lead to an increase in household wealth. The effect of these factors on how farmers allocate their time is tested empirically using labour participation and labour supply models. The models developed are sufficiently general for application elsewhere. The main findings for the Irish situation are that the decoupling of direct payments is likely to increase the probability of farmers participating in the off‐farm employment market and that the amount of time allocated to off‐farm work will increase.     

An economic approach to soil fertility management for wheat production in north-eastern Australia

Soil fertility decline and soil management for crop production are important economic issues for grain growers in north-eastern Australia. In that region, there is evidence of soil fertility decline which is attributed to past crop management practices. The questions addressed in this article are first, whether components of soil fertility can be improved by better management and second, by how much soil fertility would change. Soil fertility for crop production is considered in terms of soil organic carbon and nitrogen. A stochastic dynamic economic analysis of soil fertility management for wheat production is presented. A sequential analysis of first deriving the optimal nitrogen stock and application rates is followed by an assessment of tillage, stubble, and fertilizer strategies to obtain an optimal level of soil organic carbon. The recommended management practices are consistent with emerging management trends in the region. The derivation of optimal levels of soil fertility for agricultural purposes has other policy implications, which we discuss.     

Raising offtake from cattle grazed on natural rangelands in sub-Saharan Africa: a transaction cost economics approach

Farmers in sub‐Saharan Africa are constrained by large transaction costs associated with marketing of their livestock. However, transaction costs are often not taken into account in the analysis of factors hampering the development of livestock marketing in this region. This article empirically measures the influence of transaction costs on the offtake from cattle grazed on natural rangelands in Uganda. The study is based on the monitoring of 696 cattle transactions in three districts of Uganda from August 2004 to August 2005. The estimated models suggest that proportional transaction costs represented by the state of roads, distance to markets, and time taken to reach the market are important variables constraining market participation. In order to raise offtake from the national herd, it is essential to explicitly address these costs. One potential solution is collective action in marketing of livestock in which proportional and fixed transaction costs are reduced and shared among the group members.     

An assessment of the economic and environmental potential of biomass production in an agricultural region

The establishment of deep-rooted perennial species and their processing for biomass-based products such as renewable energy can have benefits for both local and global scale environmental objectives. In this study, we assess the potential economic viability of biomass production in the South Australian River Murray Corridor and quantify the resultant benefits for local and global scale environmental objectives. We model the spatial distribution of economically viable biomass production in a Geographic Information System and quantify the model sensitivity and uncertainty using Monte Carlo analysis. The total potentially viable area for biomass production under the Most Likely Scenario is 360,728 ha (57.7% of the dryland agricultural area), producing over 3 million tonnes of green biomass per annum, with a total Net Present Value over 100 years of A$ 88 million. The salinity in the River Murray could be reduced by 2.65 EC (μS/cm) over a 100-year timeframe, and over 96,000 ha of land with high wind erosion potential could be stabilised over a much shorter period. With sufficient generating capacity, our Most Likely Scenario suggests that economically viable biomass production could reduce carbon emissions by over 1.7 million tonnes per annum through the production of renewable energy and a reduced reliance on coal-based electricity generation. Our analyses suggest that biomass production is a potentially viable alternative agricultural system that can have substantial local scale environmental benefits with complimentary global scale benefits for climate change mitigation.     

The impact of climate change on labour demand in the plantation sector: the case of tea production in Sri Lanka

Limited opportunities for crop switching and lengthy preharvesting periods make the plantation sector particularly vulnerable to climate change. Surprisingly, however, the economic consequences of climate change on plantation crops are seldom analysed. Drawing on a unique primary panel data set from a representative cross section of 35 tea estates in Sri Lanka over the period 2002–2014, this study implements a structural model of estate profit maximisation to estimate the elasticity of labour demand with respect to different components of weather. Results indicate a negative relationship between labour demand and rainfall in the south‐west monsoon, the north‐east monsoon and the second inter‐monsoon. A positive relationship is found between labour demand and rainfall in the first inter‐monsoon. Overall, predicted changes in rainfall by 2050 are anticipated to reduce labour demand by approximately 1,175,000 person‐days per year across Sri Lanka's tea plantation sector. This is likely to have considerable social and welfare implications, particularly for the Indian Tamil women who comprise the majority of the sector's workforce.     

Assessing cost‐effectiveness when environmental benefits are bundled: agricultural water management in Great Barrier Reef catchments

Using economic analysis to prioritise improvements in environmental conditions is particularly difficult when multiple benefits are involved. This includes ‘bundling’ issues in agricultural pollution management, where a change in management action or farming systems generates multiple improvements, such as reductions in more than one pollutant. In this study, we conceptualise and compare two different approaches to analysing cost‐effectiveness when varying bundles of benefits are generated for a single project investment. Each approach requires data to be transformed in some way to allow the analysis to proceed. The index approach requires the transformation on the benefits side so that the effects of multiple pollutant changes can be combined into a measure for each project which can then be compared to costs. By comparison, the disaggregation approach requires the transformation on the costs side where costs for each project have to be apportioned across the different pollutants involved. The paper provides novel insights with an application to agricultural water quality improvements into the Great Barrier Reef in Australia, demonstrating that while both approaches are effective in prioritising projects by cost‐effectiveness, the disaggregation approach provides more insightful results and values that may be relevant for use as upper value guidelines in future project selection.     

Myopia and saliency in renewable resource management

An important challenge in managing renewable resources is to understand why owners and managers sometimes make decisions that deplete resources and future earnings, such as when graziers allow pastures and land condition to be degraded. In this paper, we test two potential reasons for unsustainable management practices, myopia and salience, with each explaining why resource managers may exhibit impatience in harvest decisions. Myopia is associated with decision makers placing lower weight on future outcomes than would be implied by their pure time preference. Salience is associated with overweighting of consumption ‘now’, implying inconsistency in time preferences. To test for these effects on renewable resource management, an incentivised, dynamic field experiment was carried out with rangeland grazing enterprise owners in north‐eastern Australia that related management choices with uncertain rainfall events to both profits and land condition over time. Results demonstrate that respondents exhibiting myopia/salience in their choices tended to achieve lower cumulative scores in the experiment, as well as lower land conditions on their properties as measured with remote sensing data. Our results explain why there may be persistent optimisation failures by resource owners that reduce both profits and environmental outcomes.     

The impact of conservation tillage on maize yield and input demand: the case of smallholder farmers in north‐west Ethiopia

This study analyses the economics of conservation tillage (CT) with respect to its effect on maize yield and chemical fertiliser, herbicide, and female and male labour demand. We estimate production and input demand functions using seemingly unrelated regressions on plot‐level cross‐sectional farm household data collected in the north‐west of Ethiopia. A two‐step control function is applied to address potential endogeneity bias due to the inclusion of the CT adoption decision as an explanatory variable. Our results show that CT increases maize yield and chemical fertiliser demand. Additionally, the results show that the adoption of CT reduces female and male labour required for crop production. However, this is achieved through the increased use of herbicides, which might have an undesirable health and environmental effects.     

Implementing industrial policy: How to choose?

There has been a resurgence of interest in industrial policy in higher income as well as in emerging and still developing economies, in part due to a renewed interest in the role of economic structure, with industrial policy interpreted as interventions designed to shift resources into higher return, higher growth activities. Dialogue with the private sector is critical but central to policy choice is how far policy should be applied on a vertical as opposed to a horizontal basis. This paper surveys the techniques available to guide selectivity, focusing in particular on trade-based indicators. It concludes that whilst in practice some selectivity is necessary, there is a limit as to how far this can be guided by objective indicators and flexibility and experimentation will be required in the application of policy.