NONLINEAR DYNAMICS AND ECONOMIC INSTABILITY: THE OPTIMAL MANAGEMENT OF A BIOLOGICAL POPULATION

Assuming a competitive market, conditions are determined for when a steady-state equilibrium does not exist in the optimal dynamic management of a biological population. Irregular and unpredictable behavior (called "chaos") can arise from fully rational economic decision making. High interest rate, adjustment costs, and an inelastic demand can contribute to market instability

Acreage Decisions Under Risk: The Case of Corn and Soybeans

An acreage supply response model is developed under expected utility maximization. The resulting framework is used to specify and estimate a system of risk-responsive acreage equations for corn and soybeans in the U.S. Particular attention is given to the truncation effects of government price supports on the distribution of corn and soybean prices. Also, a wealth variable is included in the acreage equations. The empirical results indicate that risk and wealth variables play an important role in cornsoybean acreage decisions. The analysis also shows that cross-commodity risk reduction is important in acreage allocation decisions

Economic Behavior under Uncertainty: A Joint Analysis of Risk Preferences and Technology.

A method is developed to estimate jointly risk preferences and technology under general conditions. The approach is illustrated in an application to the analysis of U.S. corn-soybean acreage decisions over time. The results provide useful information on the nature of farmers' risk preferences and on the influence of price risk and production risk on acreage allocation and farmers' welfare. Copyright 1996 by MIT Press.

NONLINEAR DYNAMICS AND ECONOMIC INSTABILITY: THE OPTIMAL MANAGEMENT OF A BIOLOGICAL POPULATION

Assuming a competitive market, conditions are determined for when a steady-state equilibrium does not exist in the optimal dynamic management of a biological population. Irregular and unpredictable behavior (called “"chaos"”) can arise from fully rational economic decision making. High interest rate, adjustment costs, and an inelastic demand can contribute to market instability.Environmental Economics and Policy,