Conversion subsidies for organic production: results from Sweden and lessons for the United States

Organic conversion subsidies used in Europe are less likely to be politically acceptable in the United States, where organic agriculture development is market‐driven. Persistent barriers to conversion in the United States include limited availability of and access to production and market information, training in management systems and cost of conversion‐related investments. By determining whether these factors affect the requirement of a subsidy to convert, we can suggest whether U.S. policy makers need to provide subsidies to encourage conversion and identify policy variables consistent with market‐based approaches that could stimulate conversion. A utility difference model is used with Swedish data to analyze factors that determine whether a subsidy is required to motivate organic conversion. The results show that farmers requiring subsidies manage larger less‐diversified farms and are more concerned with organic inspection, quality, and adequacy of technical advice. Access to more market outlets and information sources substitutes for payment level in the farmer's utility function, indicating that services rather than subsidies may be used to encourage organic agriculture. To the extent that conditions are similar in the U.S. organic sector, market‐based programs such as cost‐sharing for conversion and market access improvement should stimulate growth of this industry.     

Non-parametric and parametric bootstrap techniques for age-to-age development factor methods in stochastic claims reserving

In the literature, one of the main objects of stochastic claims reserving is to find models underlying the chain-ladder method in order to analyze the variability of the outstanding claims, either analytically or by bootstrapping. In bootstrapping these models are used to find a full predictive distribution of the claims reserve, even though there is a long tradition of actuaries calculating the reserve estimate according to more complex algorithms than the chain-ladder, without explicit reference to an underlying model. In this paper we investigate existing bootstrap techniques and suggest two alternative bootstrap procedures, one non-parametric and one parametric, by which the predictive distribution of the claims reserve can be found for other age-to-age development factor methods than the chain-ladder, using some rather mild model assumptions. For illustration, the procedures are applied to three different development triangles.     

Electrification and energy productivity

Energy productivity is crucial for sustainable development. We use cointegration analyses to investigate the effect of electricity on energy productivity in Swedish industry from 1930 to 1990. Electricity augmented energy productivity in those industrial branches that used electricity for multiple purposes. This productivity effect goes beyond “book-keeping effects,” i. e. it is not only the result of electricity being produced in one sector (taking the energy transformation losses) and consumed in another (receiving the benefits).     

Optimal policy rules and regime switching in disequilibrium models

This paper emphasizes the need to search for globally optimal policy levels (for public production, say) in fix-price disequilibrium analysis. Regime-specific rules are inadequate. They ignore the fact that moving a policy towards its optimal level may move the economy from its initial disequilibrium regime to a different regime where the rule no longer applies.     

A Monte Carlo comparison of the maximum likelihood and the corrected ols estimators for Tobit models

Green (1981,1983) proposed a simple way to correct the bias of OLS in Tobit models. In this paper, I present some Monte Carlo results comparing the performance of the Corrected OLS (COLS) with the Maximum Likelihood (ML) estimator.     

Parametric Approaches to Productivity Measurement: A Comparison among Alternative Models

This paper deals with modeling total factor productivity (TFP) growth in a flexible manner using panel data. Several competing parametric models are used to explore whether there are any similarities in the estimates of TFP growth and technical change among these models. Using a primal approach, we decompose TFP growth into different components. The models are then used to measure productivity and technical change in the Swedish cement industry. In general, the results are found to be model dependent and often conflicting, although much less so for returns to scale and overall productivity growth.
JEL classification: O 30; C 33     

Introduction

Editorial Introduction

Introduction     

The Q Theory and the Swedish Housing Market—An Empirical Test

We argue that major changes in economic policy have resulted in a more market driven demand for housing investment in Sweden, due to policy changes at the end of the 1980s and the beginning of the 1990s. Tobin’s transparent Q theory is the investment theory used. For the last period of the sample (1993–2003 quarterly data), our results indicate that there exists a high degree of correlation between the Q ratio and the (logarithm of) two different variables for housing investment. An error correction regression model, controlling for structural breaks, also indicates that a stable long-run relationship could be detected for the logarithm of building starts and the Q ratio between 1993–2003, but not between 1981–1992.      

Even the bad times are good: a behavioural theory of transformation pressure

A theory of transformation pressure was developed in Swedenin the 1990s which suggested that structural changes, rationalisationsand innovations are stimulated by profit crises, arising, forexample, from negative demand shocks and restrictive economicpolicies. Firms will then either become more creative or abandonan overconfident, risk-prone and irrational status quo strategy.A qualified theory states that productivity will increase asexternal pressures become stronger but only up to a certainpoint. A competing qualified theory maintains that productivityis maximised if periods of hard pressure are succeeded by periodsof financial and technical consolidation, scale advantages andweaker demands for defensive actions to raise productivity.