Treating respondent uncertainty in contingent valuation: A comparison of empirical treatments

This research examines the impact of uncertainty on contingent valuation responses using (1) a survey of Canadian landowners about willingness to accept compensation for converting cropland to forestry and (2) a survey of Swedish residents about willingness to pay for forest conservation. Five approaches from the literature for incorporating respondent uncertainty are used and compared to the traditional random utility model with assumed certainty. The results indicate that incorporating uncertainty has the potential to increase fit, but could introduce additional variance. While some methods for uncertainty can be an improvement over traditional approaches, it is imperative to exercise caution when making systematic judgments about the effect of uncertainty on contingent valuation responses.     

Farm-gate tomato price negotiations under asymmetric information

This article provides an empirical analysis of farm‐gate tomato price negotiations under asymmetric information. Regression models are estimated to analyze when and by how much sellers stick to their initial ask prices and what explains the variation in the initial ask–offer price spread. Detailed information on 66 farm‐gate tomato transactions and daily tomato wholesale price data from the central vegetable market in Addis Ababa are used for the analysis. Estimation results show that farmers are less committed to their initial ask price when the buyer speaks out the transaction price first, when their quality perceptions of the tomatoes being transacted differ from those of the buyers, and when their tomato farm is at a large distance from the main road. Sellers stick more to their initial ask price when they know that the central market price is high. The initial ask–offer price spread decreases when the buyer speaks out the initial negotiation price first, but increases in the difference in quality perception between buyer and seller, and in the quantity of tomatoes being transacted.     

Explicit normative measurement of the degree of income inequality

Summary This paper deals with the problem how to measure the degree of inequality implied by a certain distribution of personal incomes. Traditional approaches to this subject, including statistical and welfare-based indicators, possess some important short-comings. As an alternative procedure this paper proposes the use of explicit normative concepts, by defining indicators which measure the divergence between an actual income distribution and a target or desirable one. Several indicators are given. The problem how to specify a target distribution is discussed, and a tractable procedure is indicated. This is applied to both actual and simulated income data. The examples serve only as illustrations of the approach proposed and use of the indicators for actual policy evaluation still requires more data.The author wishes to thank Henk van Metelen and Arend Stemerding for research assistance, and Simon Kuipers, Peter Nijkamp and Jan Tinbergen for their stimulating remarks on an earlier draft of this paper. Of course, they are not responsible for errors and do not necessarily share the opinion expressed in this paper. This paper has been presented at the Econometric Society European Meeting, Helsinki, August 1976. An extensive discussion of different aspects of income distribution is contained in Bartels (1977).     

Adoption and Impacts of Sustainable Agricultural Practices on Maize Yields and Incomes: Evidence from Rural Zambia

This paper uses a multinomial endogenous treatment effects model and data from a sample of over 800 households and 3,000 plots to assess the determinants and impacts of adoption of sustainable agricultural practices (SAPs) on maize yields and household incomes in rural Zambia. Results show that adoption decisions are driven by household and plot level characteristics and that the adoption of a combination of SAPs raises both maize yields and incomes of smallholder farmers. Adoption of improved maize alone has greater impacts on maize yields, but given the high cost of inorganic fertiliser that limits the profitability of adoption of improved maize, greater household incomes are associated rather with a package involving SAPs such as maize–legume rotation and residue retention.     

Calibration of agricultural risk programming models using positive mathematical programming

Mathematical programming models of farmers’ cropping decisions must first be calibrated before they can be used to examine agricultural producer responses to policy changes. In this paper, we compare three calibration approaches for disentangling the risk parameter from the parameters of the cost function: one assumes a logarithmic utility function, while the others employ an exponential utility function. Historical crop insurance data for southern Alberta, Canada, are used to assess the calibration performance of the three approaches, and sensitivity analysis is implemented to test whether the changes in the optimal land allocation caused by the changes in the values of the parameters are practically reasonable. Only one of the three models is of practical use for policy analysis because it can recover the true values of the parameters and the results of sensitivity analysis are reasonable.     

FELLOWS ADDRESS California Dreaming: The Economics of Renewable Energy

California was the first jurisdiction to mandate a reduction in greenhouse gas (GHG) emissions by 80% below 1990 levels by 2050. This target was subsequently endorsed by the G8 in 2009 and the European Commission in 2014, and is the guiding principle of the 2015 Paris Agreement. To achieve these targets will require near elimination of fossil fuels and/or a technological breakthrough that might be considered a black swan event. Eschewing nuclear power, countries are relying on renewable energy sources to meet future energy needs. In this paper, I examine the prospects of reducing GHG emissions by 80% by first summarizing extant global energy sources and production, trends, and projections of energy demand, and the potential mix of future energy sources. I consider the role of conservation and then focus on the electricity sector to determine how wind and biomass could contribute to the 80% target. I conclude that these ambitious targets cannot be attained without nuclear power.     

Are Agricultural Values a Reliable Guide in Determining Landowners' Decisions to Create Forest Carbon Sinks?

This research examines the effects of various factors on farmer participation in agricultural tree plantations for economic, environmental, social, and carbon‐uptake purposes, and potential costs of sequestering carbon through afforestation in western Canada. Using data from a survey of landowners, a discrete choice random utility model is used to determine the probability of landowners' participation in and corresponding mean willingness to accept (WTA) compensation for a tree‐planting program. WTA includes positive and negative benefits to landowners from planting trees, benefits not captured by foregone returns from agricultural activities on marginal land. Estimates of WTA are less than foregone returns, but even so average costs of creating carbon credits still exceed their projected value under a CO₂‐emissions trading scheme. La présente étude a examiné les effets de divers facteurs sur la participation des producteurs agricoles à la plantation d'arbres à des fins économiques, environnementales, sociales et d'absorption du gaz carbonique, ainsi que les coûts potentiels de la séquestration du carbone au moyen du boisement dans l'Ouest canadien. À l'aide des données d'un sondage effectué auprès de propriétaires fonciers, nous avons utilisé un modèle d'utilité aléatoire à choix discrets pour déterminer la probabilité de participation des propriétaires fonciers à un programme de boisement et leur consentement à recevoir (CAR) une compensation financière pour leur participation. Le CAR inclut les avantages favorables et défavorables que le boisement procure aux propriétaires fonciers, des avantages non saisis par les revenus sacrifiés des activités agricoles sur des terres marginales. Les estimations du CAR sont inférieures aux revenus sacrifiés, mais malgré tout, les coûts moyens de la mise en uvre de programme de crédits pour le carbone demeurent supérieurs à leur valeur prévue dans un scénario d'échange de droits d'émission de CO₂.     

THE DUTCH ECONOMY 1921–39: REVISED MACROECONOMIC DATA FOR THE INTERWAR PERIOD

A set of revised macroeconomic time series for the Netherlands 1921–39 is presented. The series cover the "Consolidated Accounts for the Nation" of the SNA in current prices as well as the national product account and some additional series in prices for the previous year. The new interwar series differ considerably from the data that has been published before. They are also more comprehensive, more detailed, and conceptually consistent with the modern national accounts.     

Rice market integration in the Mekong River Delta1

In the last decades Vietnam has become a major supplier in the world's rice market. This position is the result of the policy reforms that have been implemented in the agricultural sector. This paper assesses the impact of the liberalization policies and focuses on the spatial price differences in the domestic rice market. The results show that price patterns correlate strongly in the Mekong River Delta. Even prices in other regions are integrated with price patterns in the South. Interestingly, private traders in the Mekong Delta are only indirectly responsible for the latter result. They satisfy local demand and deal with state‐owned enterprises (SOEs). In the framework of the national food security policy, the state‐owned food companies ‘subsidize’ transactions between the South and the North. Moreover, the state‐owned food companies still dominate export transactions. The latter issues constitute two major queries for policy makers involved in the liberalization of the rice market, as further policy measures should not jeopardize the interests of domestic rice consumers.     

Travel and activity time allocation: An empirical comparison between eight cities in Europe

A study of daily time allocation to travel and out-of-home activity is conducted across eight European cities over three countries: France (Lyon, Grenoble, Strasbourg and Rennes), Switzerland (Geneva, Bern and Zurich) and Belgium (Brussels), based on individual travel survey data collected between 1997 and 2006. The effects of socio-demographic, spatial context, transport availability and city-specific variables are investigated thanks to the Cox proportional hazard model. The results indicate that socio-demographic characteristics and city (or country) specific effect play a major role while residential density and proximity to high level road or public transport networks have a very limited impact on time budgets for travel and out-of-home activities.