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.     

HRM practices and organizational commitment profiles

In this study, we examined how employee perceptions of development-oriented, stability-oriented, and reward-oriented human resource management (HRM) practices affected the likelihood of affective and continuance commitment profile membership. Our focus on profiles of combined commitment components is a departure from a literature dominated by studies of the separate forms of employee commitment. Drawing from self-determination theory (Deci and Ryan 2000) we described the nature of the psychological states believed to underlie the specific profiles under investigation, then tested a series of theoretical predictions concerning the link between HRM practices and the likelihood of profile membership. Predictor and criterion data for this study were collected from 317 respondents working in a variety of Canadian-based organizations. Our findings suggest ways that organizations can use HRM practices strategically to help shape the nature of overall employee commitment.     

Optimal Markup Decisions under Demand Uncertainty

This article examines the consistency with economic theory of a rule of thumb in which a risk-averse firm facing demand uncertaintly sets its price based on a percentage over the price paid to farmers. A testable set of comparative static results determines how the optimal markup is influenced by shifts in key parameters affecting the firm: expected demand, demand uncertainty and average variable costs. The model is tested using data from the wholesale markets for organic lettuce, broccoli and carrots. The results demonstrate that risk-averse wholesalers raise markups as expected demand increases and reduce them as uncertainty increases, consistent with risk-averse behavior. The empirical models show that produce marketing agents monitor shifts in expected demand and demand variability when adjusting markups. Expected demand has a greater impact on markups than demand variability.     

Meeting the Needs of Organic Farmers: Benchmarking Organizational Performance of University Extension

A stochastic frontier model is used to explain the performance evaluation by organic producers of programs provided by the U.S. university extension systemproviders. We identify nonmanagerial factors that influence both performance ratings and performance efficiency, defined as achieving a rating as close to the highest rating as possible. Results based on the organic farmer evaluators indicate that extension agents are performing at high mean efficiency of 0.95, but that the average rating is relatively low at 2.66 on a four-point scale. Years of experience in organic farming and the severity of production problems facing farmers have significant impacts on performance ratings.     

Longevity and Genetic Improvement Issues in Replacing Dairy Cows

The objective of this research is to identify optimal economic replacement strategies for dairy cows within the framework of genetic improvement and to compare these strategies with those followed by Alberta dairy farmers. Production records from four commercial dairy herds are used to model the optimum replacement policy within a wealth-maximizing objective, allowing comparison of predicted results with observed practice in the industry. Unplanned replacement, due to biologial failure of cows, is included in the model as a finite Markov process. The economically optimal replacement time is found to occur at the end of the sixth lactation, with only minor penalties for suboptimality. Planned replacement after the sixth lactation requires culling approximately one quarter of the herd annually, and results in an average herd age of 5.77 years. Since the band of economically reasonable replacement policies extends from the third to the tenth lactation, the average herd age ranges from 4.48 years and 7.02 years. The observed average age of Alberta milking herds of 4. 78 years lies in the lower part of this predicted range. While one can conclude that the model leads to an optimum that is consistent with the observed behavior of Alberta dairy farmers, one must temper this conclusion with the caution that additional research, especially regarding the technical lactation curve, is indicated L'objet de la présente recherche était de dégager des stratégies de remplacement economiquement opti-males pour les vaches laitières, compte tenu des exigences de l'amelioration génétique, et de comparer ces stratégies avec celles qu'utilisent les producteurs laitiers de I 'Alberta. On a utilisé les relevés de production de quatre exploitations laitières commercials pour modéliser les stratégies de remplacement optimales dans un objectif de maximisation des revenus. Le modèle permet également de comparer les résultats prédits avec ceux observés sur le terrain. Les remplacements non prévus, à cause de défauts biologiques des vaches, étaient inclus dans le modèle comme processus de Markov fini. L'époque de remplacement économiquement optimale s'est révélée être le fin de la sixième lactation, avec seulement de légères pertes de rentabilité pour les situations suboptimales. Le remplacement planifié après la sixième lactation exigeait la mise à la réforme d'environ un quart du troupeau chaque année et donnait pour le troupeau un age moyen de 5,77 ans. Comme l'écart des possibilités de remplacement économiquement plausibles va de la troisième à la dixieme lactation, l'âge moyen des troupeaux se situe entre 4,48 et 7,02 ans. L'âge moyen réel des troupeaux laitiers de l'Alberta (4,78 ans) se situe dans le bas de eel écart de prédiction. Tout en reconnaissant que le modèle conduit à un optimum cohérent avec le comportentent réel des producteurs laitiers de l'Alberta, il reste qu'on a besoin de plus de recherche dans ce domaine, en particulier en ce qui concerne la courbe de lactation technique