Facing increasing nonrenewable and environmental concerns with fossil power generation, renewable energy is being supported by government mechanisms. With the power generation cost of renewables generally higher than fossil fuels, determining the optimal level of these mechanisms requires an understanding of households’ prosocial behavior toward renewables. The issue is determining the magnitude households are willing to pay (WTP) for alternative renewables. Our hypothesis is this behavior varies by the type of renewable energy. As a test of this hypothesis, we apply a discrete choice experiment to measure households’ WTP. Results support our hypothesis with a positive WTP for solar energy, leading to a 62% reduction in solar subsidy, and a negative WTP for biomass and wind sources.

The dairy industry is of much interest worldwide because it has been subject to heavy government intervention. Central to the analysis of any dairy policy is a quantitative empirical understanding of the economic relationships in the industry. This paper models and measures the input demand relationships—especially, derived demand for farm milk as a processing input—and the rate and biases of technical change in the U.S. dairy manufacturing industry. Our estimates indicate that the Marshallian own-price elasticity of demand for farm milk is between −0.43 and −1.20. Estimates also indicate that technical change has been capital using and labor saving.

Bison is an important and iconic mammal in the U.S. that is being reintroduced in many places after being driven nearly to extinction. This paper provides a nationwide assessment of the local economic impacts of bison reintroduction so that rural communities can take economic well-being into account when considering decisions regarding future bison restorations. We estimate the causal impacts of bison herd establishment on county-level income, employment, and population growth using staggered difference-in-difference and the synthetic control approaches. The simple positive correlation between local per capita income and bison herds might lead planners to think that bison reintroduction is good for the local economy. However, none of the causal inference analyses find statistically significant effects of bison reintroduction.

Christmas tree sales are considerable throughout the United States. Understanding the drivers of purchase for Christmas trees is critical for producers and stakeholders within states with tree production. Using data from a choice experiment in combination with latent class modeling, we find that tree height is important, but tree species is less important. Further, we show that local labeling does not influence all consumers. With respect to retail location, we show that nursery/greenhouse and choose-and-cut retail outlets are preferred by a majority of consumers but not by all consumers. Recommendations for the varying retail outlets are provided.

Gauging the impact of recent policy changes, this article analyzes production characteristics and the impact of the dairy assessment for northeastern dairy farmers as compared to other major production regions. Employing a restricted translog variable profit function, returns to size, shadow prices, supply elasticities for milk and livestock as well as demand elasticities for concentrate were estimated. Northeastern, just as midwestern farmers, were less responsive in milk supply and concentrate demand, more responsive in livestock production, and less efficient than their California and Texas counterparts. The dairy assessment affected profits of northeastern farmers later than those of other regions. Negative shadow prices indicated overinvestment into fixed factors.

The USDA's Market Access Program (formerly Market Promotion Program) recently underwent a major change to redirect all branded products export promotion funds to small domestic firms and cooperatives. The redirection responded to criticisms by the General Accounting Office of past allocations of branded products export promotion funds to large, experienced exporters. This study uses a firm-level analysis to examine whether firm size and export experience matter in how effectively firms use the promotion funds to increase their revenues. The results support neither the GAO criticisms nor the recent program redirection.

Two issues lurk in the background of the papers by Lichtenberg, Taylor, and Cropper et al. The first is a specific question about the goal of regulatory policy. The second is a more global consideration regarding politics, technological change, and the future.

Cow-calf enterprises in the Northeastern United States are generally small and often the only agricultural enterprise of families with large off-farm incomes. In this paper, the economic viability of cow-calf enterprises to these investors is considered using a representative farm/economic engineering approach. Investments in farm real estate that is characterized by limited capability soil resources are found to yield negative labor and management incomes but to be economically viable when change in net worth and present value of family after-tax income are considered.

Institutions of higher education span as great a range of size, illustrating as great a variation in fixed and variable inputs, as most of the firms that economists have occasion to study: farms, marketing concerns, recreation businesses, and the like. In the educational field, professionals at the smaller schools frequently look to their counterparts at larger institutions for innovation and leadership. This is, perhaps, a natural outgrowth of the age, prestige, and scope of academic enterprise which typify most of the larger universities.

This study examined the null hypothesis that getting started in farming in the 1970's was not more difficult than it was in earlier periods in the twentieth century. Comparative budgets were constructed using farm survey and farm account data for three different regions at four different time periods. In terms of years of farm wages required to earn beginning equity and cash flow to meet debt payments and family living costs, the null hypothesis was accepted. In general 1978–80 was more like 1910–12 than the more difficult times of 1930–32 and 1950–52.

Leasing of agricultural land is gaining in importance in North America. The impact of leasing on soil management practices is examined in an area in the Canadan province of Ontario. Prevailing land contracts are insecure and the rental land market appears to be imperfect in the area. Under these conditions leasing leads to undesirable soil management practices and consequently to a lower state of conservation and to lower crop productivity over time. A difference in soil management and crop productivity has been observed between owner-operated and rented land.

American agricultural production is viewed by starving masses in the world as a great white knight; it can come charging into their lives and rescue them from starvation, malnutrition, and misery. Over the years we have maintained a granary that fed many millions of starving people. Now that these granaries are essentially depleted, there is a demand on the part of the World Health Organization, members of Congress and others that we replenish these reserves and continue to serve this role, rescuing people from starvation.

North American agriculture is passing through yet another period of adjustment in markets, production levels, and government programs. The adjustment grows out of an enormous change in global food conditions after 1980. Nations that traditionally imported large amounts of foodstuffs begin to move toward greater self-sufficiency and nations that exported to them saw surpluses began to pile up in their warehouses. The burden of these shifts was not borne evenly by exporting nations. The United States experienced a dramatic downturn in its food exports while other nations, often using government subsidies to gain market share, went on increasing production and exports.

Pest control efforts for tree fruits, as well as other agricultural crops, have intensified in the U.S. during the past few decades. This increase is the result of the increase in pest population, the Food and Drug Administration's reduction in tolerance levels of insect parts permitted in foods, and the raising of cosmetic standards by food wholesalers and retailers (Hough and Gallahan).

Data on farm numbers are widely discussed and frequently misinterpreted. These numbers comprise one of the nation's oldest and most basic statistical series. As such they are a fundamental part of our agricultural data system. This paper argues that American farms should be classified into three separate categories for both descriptive and analytical purposes. Such divisions will allow us to understand more fully the changes in farming which have occurred and the implications of changes now in progress. Rates of change in size distributions, productivity and net income may be examined in perspective. Public understanding of the policy issues involved will be enhanced.

The grain/oilseed industry is undergoing considerable structural change through mergers and new value-added businesses, which raises price-related questions. We analyze the level of price integration prior to and following a merger between two grain firms and the start-up of a producer-owned ethanol facility. This research utilizes error correction vector autoregression analysis to compute market integration structural change effects. We find evidence that market integration initially increases with the merger, but deteriorates with time following the merger. We find no significant localized change in the level of price integration for the case of a new value-added business.

Using data from a survey of Pennsylvania food processors, we investigate what firm-level characteristics make a processor more or less likely to buy agricultural inputs and ingredients though contracts. We find that over 20 percent of Pennsylvania processors use contracts, and over 44 percent of agricultural inputs (based on value) are purchased under contract. We also analyze the two related questions of what firm attributes, attitudes, or other factors make a firm more likely to use contracts at all, and what factors lead a processor who does contract to use them more intensively.

This paper examines the elimination of all agricultural policy distortions in all trading countries and agricultural production decisions in the United States, as well as subsequent environmental quality in the presence and absence of nondegradation environmental standards. The results suggest that trade liberalization has the potential to increase domestic production and boost agricultural returns by as much as 8.5 percent. Consumer surplus would likely fall, and the discharge of nutrients, sediment, and pesticides would likely increase. However, environmental policies can limit these adverse environmental impacts and mute the potential decrease in consumer surplus, while leaving increased returns to agricultural production.

We develop a theoretical framework and present a corresponding empirical analysis of the Food and Drug Administration’s irrigation water quality regulatory standard under the Food Safety Modernization Act using lettuce as a case study. We develop a stochastic price endogenous partial equilibrium model with recourse to examine the standard’s efficacy under various scenarios of foodborne illness severity, standard implementation, demand response to foodborne outbreaks, and irrigation costs. The stringency of regulation is evaluated with endogenous producer response to regulatory requirements and corresponding implications for economic surplus. The baseline results show that in the case of the lettuce market, the proposed microbial irrigation water quality regulation in the Food Safety Modernization Act (FSMA) is not cost effective relative to the existing Leafy-Greens Marketing Agreements relying on water treatment for mitigation of microbial contamination. However, FSMA can be cost effective if water treatment is sufficiently expensive.