A previous study showed that imposing economic restrictions improves the forecasting ability of food demand systems, thus warranting their use even when they are rejected in-sample. This article evaluates whether this result is due to economic restrictions enhancing degrees of freedom or containing nonsample information. Results indicate that restrictions improve forecasting ability even when they are not derived from economic theory, but theoretical restrictions forecast best.

Technical regulations are increasingly visible in agricultural trade, yet their idiosyncratic nature has limited prior aggregate analysis. This article draws on a unique data source for systematic enumeration of the technical regulations questioned by one exporter among all of its trading partners in mid-1996. Political economy analysis indicates that barriers decrease when the relative contribution of agriculture to an economy increases, when the anticipated future level of protection through other forms of government intervention increases, and when economies are more open. Despite increased scrutiny and discipline by the World Trade Organization, technical barriers remain a significant impediment in world agricultural markets.

Hog farmers' preferences for autonomy are assessed through the use of eight questions dealing with their preferences for general decision making and with respect to specific management actions. Farmers generally preferred to make a higher percentage of the decisions about their operations, especially older producers and those who operated farrowing units. Farmers who placed lower values on autonomy finished hogs, were nearing retirement, valued social relationships with other farmers more highly, had higher off-farm income, or were larger farmers.

This paper examines the linkages among agricultural total factor productivity, farm size, and farm household participation in the off-farm labor market for the Southeastern states for the period 1960-1996. We find evidence of a simultaneous relationship between productivity and measures of farm structure. The results support the expected relationships between the endogenous variables, namely that productivity and farm size are positively related, farm size and off-farm work participation are negatively related, and off-farm work and productivity are negatively related. We find positive and significant impacts of government policies (investments in public research, extension, and highways) on productivity growth.

Conditional efficiency or forecast encompassing is tested among alternative pork production forecasts using the method proposed by Harvey and Newbold. One-, two-, and three-quarter ahead pork production forecasts made by the United States Department of Agriculture (USDA), the University of Illinois and Purdue University Cooperative Extension Service, and those produced by a univariate time series model are evaluated. The encompassing tests provide considerably more information about forecast performance than a simple pair-wise test for equality of mean squared errors. The results suggest that at a one-quarter horizon, the Extension service forecasts encompass the competitors, but at longer horizons, a composite forecast may provide greater accuracy.

We use Kriström's simple spike model to assess the factors influencing consumers' willingness to pay a premium for a variety of certified wood products. A survey of over 1,600 Pennsylvania and Tennessee residents found that approximately 35% were willing to pay some positive “premium” for environmentally certified wood products. For three types of wood products (a $28.80 shelf, a $199 chair, and a $799 table), we find the estimated market premiums to be $3.74, $15.94, and $45.07, respectively.

Concentration in beef packing has risen dramatically in the past 25 years. We develop measures used to describe feedlot-packer relations: (1) a statistic based on the proportion of its sales a feedlot makes to a given packer, and (2) a measure of the switching behavior of feedlots. The measures are calculated using a confidential data set from the USDA Grain Inspection, Packers, and Stockyards Administration. Relationships are found to be both exclusive and stable. Causes for this rigidity are then examined using regression analysis. Transaction costs are shown to help explain why this market differs from a perfectly competitive one.

A national survey of broiler industry executives is conducted to analyze site-specific factors related to the broiler-complex location problem. Conjoint analysis is used to analyze the broiler complex location decision. Feed costs, community attitude toward the broiler industry, availability of geographically concentrated growers, unemployment rates, and wage rates were found to be the top five factors affecting broiler company location decisions. The quality of roads between feed mill and growers; electricity, heating, water, and sewage costs; and the number of potential growers in the region were also found to be important.

This paper explores the effect farmer perceptions concerning how best management practice (BMP) adoption changes the profit distribution have on BMP adoption incentives and the potential for insurance to increase these incentives. Adoption indifference curves illustrate the effect of farmer perceptions on BMP adoption incentives and the potential for insurance to expand the set of perceptions consistent with adoption. Empirical analysis quantifies these conceptual results for nutrient BMP insurance, a new policy available to corn farmers as part of a USDA-Risk Management Agency pilot program in four states. Results indicate that nutrient BMP insurance can have economically relevant effects on farmer adoption incentives.

Price-quality relationships for alfalfa hay were analyzed by hedonic pricing models using 1996-2001 Wisconsin auction data. Individual nutrients included in the analysis all affected alfalfa price, with acid detergent fiber accounting for the largest impact. Alternative pricing models, based on an aggregate quality index or detailed quality information, were similar in their ability to predict price. However, disaggregating price predictions to account for differences in relative feed value (RFV) and crude protein (CP) indicate that both RFV and CP are important determinants of price and that aggregating the two into a quality index is not warranted.

Between the 1970s and the 1990s, processed food exports switched from using more skilled labor per unit of output than imports to the opposite. Processed food trade also expanded during this period. More meat and poultry products in processed food trade could explain this switch in skill intensity. Growing meat trade paralleled an urban-to-rural shift in meat processing. Although this could have been a win-win situation for rural areas, many of the jobs related to expanded meat trade benefited commuter and migrant workers because late-1990s jobs slaughtering livestock and processing meat did not appeal to domestic rural workers.

We examine the allocation of technology rents between a price-setting, innovating monopolist and heterogeneous technology adopters. A model of monopoly pricing in the presence of heterogeneous adopters is used to examine conditions under which greater producer (farmer) heterogeneity leads to greater producer benefit from innovation in noncompetitive markets. An application to Bt cotton determines the profit-maximizing price of Bt cotton seed and reveals that Monsanto and Delta and Pine Land are indeed leaving money on the table in the form of unexploited profit opportunities. However, we estimate that the presence of heterogeneous adopters explains over 80% of the rents that accrue to the farmers.

Stocker cattle ownership is compared to contract grazing using stochastic simulation. Returns are evaluated for both cattle owners and caretakers in contract grazing agreements. For caretakers, contract grazing is significantly less risky than cattle ownership. Slightly to moderately risk-averse caretakers could be expected to prefer some type of contract grazing to direct ownership of cattle. For cattle owners, contracting reduces risk only slightly while significantly reducing expected returns.

Managers of greenhouses, nurseries, and landscape contractors participated in five focus group discussions on labor-related risks. Managers conceptualize labor risks along the human resource management process: (1) recruitment and selection, (2) training and development, (3) performance evaluation and discipline, (4) careers and relationships, and (5) compensation packages. In addition, they identified (6) immigrant employees and (7) labor laws and regulations as sources of risk. They recognized a large number of risk-increasing attributes, but also a number of mediating strategies to reduce these risks.

A concern in the political economy is how national income is shared between labor and capital. This study evaluates long-term changes in factor income shares in three agri-food industries, their attribution to the level of factor usage or to factor compensation rates, and relation to changes in capital intensity and factor productivity. We find long-term stability in the profit and labor shares of farm income, decline in the profit share of agricultural services industry income, and increase in the profit share of food manufacturing income due to fewer productivity improvements being passed on to wage increases.

Recreational hunting has been an attractive enterprise for some ranchers who are interested in supplementing their income from cattle. Ranchland attributes—such as parcel size, tree cover, and proximity to urban centers—are expected to influence hunters' preferences and, thus, hunting lease payments. We estimated the effects of these attributes on hunting revenues using a hedonic model. The results reveal that trees and vegetation cover on ranchlands have a positive impact on hunting revenues, indicating opportunities for silvopasture practices. Those ranchers in Florida who maintain about 22% trees and other vegetation cover receive $16.15 per acre per year from hunting leases, but doubling the cover would generate only an additional $3.20 per acre per year.

An inverse live-hog demand model was estimated to analyze whether there has been a recent increase in the magnitude of live-hog, own-quantity demand flexibility. Estimating the impact of processing capacity-utilization rate changes on live-hog prices was a second objective of this research. Results indicate that live hog prices have become more responsive to changes in hog slaughter, slaughter weight, cold storage stocks, and changes in the processing capacity-utilization rate. Finally, model results indicate that the sharp increase in processing capacity-utilization rates, the increase in average dressed weight, and the increase in hog slaughter all had a negative effect on the live-hog prices.

This study examines the return on agricultural assets relative to nonfinancial corporate assets in the general economy using aggregate Bureau of Economic Analysis data. Our results indicate that the rate of return on nonfarm assets dominates the rate of return on agricultural assets. The average rate of return on nonfarm assets is higher than the average rate of return on farm assets, and the variance of the rate of return on nonfarm assets is lower than the variance of the rate of return on farm assets. Furthermore, the rate of return on agricultural assets only exceeds the rate of return in the nonfarm sector in 1992.

An import demand model, augmented with third-country effect variables, is developed to examine the effects of strong U.S. dollar, volatility of the U.S. dollar, and competition among the exporting countries on the shares of U.S. wheat in Asian markets. In the empirical model, the dependent variable is the market shares of U.S. wheat. Explanatory variables include wheat prices of exporting countries, exchange rates between the importing and exporting countries, and volatilities of the exchange rates. Panel estimation results show that the U.S. currency value and volatility, Australian wheat price, and the volatilities of Canadian and Australian currency values have significant effects on U.S. market shares.