CONSUMER DEMAND ANALYSIS ACCORDING TO GARP

The nonparametric approach to consumer-demand analysis-based on revealed-preference axioms-is reviewed. Particular attention is paid to questions of size and power of tests for consistency of data with the existence of a stable, well-behaved utility function that could have generated the data. An application to Australian meat demand is used to show how these notions can be quantified and how prior information about elasticities, following Sakong and Hayes, may be used to increase the power of the approach.

CAN WE TAKE THE CON OUT OF MEAT DEMAND STUDIES?

Whimsy in specification choices leads to fragility of inference in econometric studies of structural change in meat demand. The literature contains a variety of results, with many contradictions, attributable largely to differences in specifications. This article reviews that literature, uses synthetic data to demonstrate the sensitivity of results to specification choices and to evaluate the power of nonparametric tests, and uses Canadian data to demonstrate a preferred approach to testing the hypothesis of structural change.Demand and Price Analysis,

A COMPARISON OF CAPITAL MEASURES IN U.S. AGRICULTURE

This study compares two panel data sets that measure capital input at the state-level in U.S. agriculture. Despite a number of similarities between the data sets, such as the composition of assets, aggregation procedures, and time frame, an examination of the final estimates of capital service flows reveals that they are drastically different for all 48 contiguous states. We examine the methods used to construct the capital series for each data set, consider some important differences in data sources and the types of data used to construct the capital measures, and outline the main assumptions concerning depreciation, service lives, interest rates, aggregation, and the scope of goods included in each of the data sets. The analysis indicates that an important statistic in the index of capital services in U.S. agriculture is the stock of buildings on farms. We conclude that the primary difference between the measures of capital input in the data sets relates to differences in estimates of the stock of buildings on farms. Given the apparent importance of the measure of the stock of buildings in the aggregate index of capital services in U.S. agriculture, more research is needed to ensure that the measure of the stock of buildings is accurate and meaningful. Once this has been accomplished there should be more agreement on an accurate measure of capital services in U.S. agriculture.Agricultural and Food Policy,

The Effects of Agricultural Research and Farm Subsidy Policies on Human Nutrition and Obesity

Agricultural policies including farm programs and R&D are said to have contributed to obesity by making food commodities cheaper and thereby encouraging consumption. This paper explores the links from agricultural policy to food prices and consumption and suggests that contribution of agricultural policy to obesity is not so clear.Agricultural and Food Policy,

Are Agricultural Policies Making Us Fat? Likely Links Between Agricultural Policies and Human Nutrition and Obesity, and their Policy Implications

Rates of obesity among adults and children in the U.S. are soaring, with potentially huge private and social costs. Increasing attention is being paid to agricultural policies as both the culprits through their perceived roles in reducing the relative prices of energy-dense foods, and as the potential saviors through their perceived ability to do the opposite. However, the effects of agricultural policies on human nutrition and obesity are not well understood. This paper considers (1) trends in agricultural commodity prices, and the contributions of commodity policies and agricultural R&D policies to those trends, (2) the links between changes in commodity prices and changes in food prices; and (3) the implications of price-induced changes in food characteristics for human nutrition outcomes. Preliminary results suggest that agricultural R&D has led to dramatic decreases in costs of production and to consequent long-term declines in commodity prices, but the links between commodity price declines and food prices are less clear and are conditioned by the changing structure of food markets. Commodity-specific trade policy has clearly put upward pressure on the domestic prices of several major food commodities, but the consumer prices for most of these foods have fallen nonetheless. Changes in relative prices of 'healthy' versus 'unhealthy' foods are difficult to establish empirically, but even if 'healthy' foods are becoming relatively more expensive, food prices in general play only a small role in determining food consumption; hence, policies aiming to reduce obesity through changes in relative food prices may prove ineffective or inefficient.H5, Agricultural and Food Policy, Food Consumption/Nutrition/Food Safety, Q18, Q16, I0,

Who Should Govern Congress? Access to Power and the Salary Grab of 1873

We examine the politics of the %u201CSalary Grab%u201D of 1873, legislation that increased congressional salaries retroactively by 50 percent. A group of New England and Midwestern elites opposed the Salary Grab, along with congressional franking and patronage-based civil service appointments, as part of reform effort to reshape %u201Cwho should govern Congress.%u201D Our analyses of congressional voting confirm the existence of this non-party elite coalition. While these elites lost many legislative battles in the short-run, their efforts kept reform on the legislative agenda throughout the late-nineteenth century and ultimately set the stage for the Progressive movement in the early-twentieth century.

STRUCTURAL ADJUSTMENT IN OECD AGRICULTURE: GOVERNMENT POLICIES AND TECHNICAL CHANGE

Agricultural and Food Policy, Research and Development/Tech Change/Emerging Technologies,

Capital Use Intensity and Productivity Biases

Measures of productivity growth are often pro-cyclical. This study focuses on measurement errors in capital inputs, associated with unobserved variations in capital utilization rates, as an explanation for the existence of pro-cyclical patterns in measures of agricultural productivity. Recently constructed national and state-specific indexes of inputs, outputs, and productivity in U.S. agriculture for 1949-2002 are used to estimate production functions in growth rate form that include proxy variables for changes in the utilization of durable inputs. The proxy variables include an index of farmers’ terms of trade and an index of local seasonal growing conditions. We find that utilization responses by farmers are significant and bias measures of productivity growth in a pro-cyclical pattern. We quantify the bias, adjust the measures of productivity for the estimated utilization responses, and compare the adjusted and conventional measures.Productivity Analysis,

Capital Use Intensity and Productivity Biases

This is a substantially revised version of “Capital Use Intensity and Productivity Biases.” Andersen, Matt A.; Alston, Julian M.; Pardey, Philip G., St. Paul, MN: University of Minnesota, Department of Applied Economics; University of Minnesota, International Science and Technology Practice and Policy (InSTePP), 2007. (Staff paper P07-06; InSTePP paper 07-02)U.S. agriculture, pro-cyclical productivity, capital utilization, primal productivity bias, Productivity Analysis, D24, C51, Q1, O4, O47,