End-Use Certificates for Wheat: Trade-Distorting Administrative Barriers?

International Relations/Trade,

THE PROVISION OF RAIL SERVICE: THE IMPACT OF COMPETITION

Grain transportation is one of the most important economic issues for grain producers in the Northern Plains. The reliance on export markets and the long distances to port position means that transportation costs have a significant effect on the price received by farmers. In the prairie region of Canada, rail transportation is undergoing a major transformation that will affect the competitive positions of agriculture in both the United States and Canada and influence the direction of grain flows between the two countries. Rail rates are no longer legislated although a cap is still in place), restrictions on branch line abandonment have been lifted, and further deregulation of price and car allocation is being considered. Some parties, including the railways, argue that a completely deregulated system, similar to the U.S. system, is the only way to achieve transportation efficiencies. Other groups, supporting the status quo, argue that the regulation of rates is essential to control the monopoly power of the railways. There has been very little discussion of other policy options, with the exception of a limited discussion of nationalized railbeds. The U.S. experience provides a stark view of the likely outcome of deregulation. When railways are not faced with competition from other railways or from other forms of transportation such as barges, the evidence suggests railways will price freight services at or near truck competitive rates. Freight rates in Montana, where no effective rail and/or barge competition exists, are approximately twice those at Kansas City and Denver/Commerce City, where such competition exists. The current cost-based regulated rates in Western Canada are similar to those at Kansas City and Denver/Commerce City. Given similar distances to port and the existence of only two railways (and no likelihood of new entrants), deregulation in Western Canada is likely to result in freight rates closer to those in Montana than to the current regulated level. The increase in freight costs will result in transfers from producers to the railways, distort production incentives, and create losses elsewhere in the economy. While maintenance of a regulated freight rate structure would address the freight rate issue, other problems would result. The lack of price signals reduces incentives for industry participants to perform. Branch lines are less likely to be maintained in a regulated environment because railways may be unable to charge the extra amount necessary to make them viable. Railways may also disrupt the system - as a form of bargaining - to create pressure for deregulation. This report explores the option of the government encouraging entry into rail service provision. Just as telecommunication companies are required to allow competitors to use their phone lines, existing railways could be required to make their track and switching equipment available to rail operators who wish to run train service on a line, on the condition that the access price covers the infrastructure cost. The paper examines the case of the British railway system where the ownership of the track has been separated from the operation of the rail equipment and the provision of service, and explores the applicability of this model to grain transportation on the Great Plains. In Britain, ownership of the track rests with a company called Railtrack (although Railtrack was government-owned, it has been privatized). Railtrack leases access to thirty train operators for fees that are regulated by the Office of the Rail Regulator to cover maintenance costs and provide a return on investment. The thirty rail operators then compete to provide service to customers. This model and others similar to it need to be developed and articulated before they can be considered in the public policy forum. Nevertheless, given the importance of rail transportation to the grain industry in the Northern Plains, it is imperative that options such as these be investigated to address the very thorny issue of freight rate and entry regulation.barriers to entry, competition, grain handling, grain transportation, monopoly, railroads, regulation, Public Economics, K2, L1, L9, L5,

TRADE LIBERALIZATION AND INTERNATIONAL MERGER IN COURNOT INDUSTRIES: THE CASE OF BARLEY MALTING IN NORTH AMERICA

When free trade merges formally distinct non-competitive industries, welfare should increase. Additional incentives for mergers may reduce these gains from free trade. We show the importance of such arguments in an analysis of the malting barley industry in North America before and after the Canadian/U.S. free trade agreement.International Relations/Trade,

CHANGING STRUCTURES IN THE BARLEY PRODUCTION AND MALTING INDUSTRIES OF THE UNITED STATES AND CANADA

Substantial changes have taken place recently in the regulation of agricultural trade in North America. The effect of these changes on trade in agricultural commodities is of particular interest to producers and policymakers in the Northern Plains and Rockies region. In this paper, we discuss specifically the malt barley production, malting, and brewing industries in light of these new trade agreements and their ramifications. We evaluate the incentives that free trade provides for mergers between barley malting firms, and then we assess the consequences of these mergers on the realized gains from trade for consumers, barley producers, and malting firms. The globalization of markets has fundamentally changed the world in which economic agents operate. Trade has been liberalized through multilateral world-wide agreements such as the General Agreement on Trade and Tariffs (GATT) and through regional free trade agreements such as those within the European Union, the Canadian/United States Trade Agreement (CUSTA), and the North American Free Trade Agreement (NAFTA). A striking phenomena which has accompanied trade liberalization has been the international merger of firms and the creation of many jointly owned multinational operations. There are two distinct types of malt barley that differ in their yield and in their production areas in North America. Montana and the Canadian provinces grow primarily high-quality two row barley, while North Dakota and Minnesota produce primarily six row malting varieties. Two row barley yields more malt per bushel for maltsters, but it is more prone to disease for barley producers. The opening of the border between the United States and Canada has made large quantities of two row barley available to U.S. malting firms and brewers. The trade policy literature suggests that trade liberalization will have a profound impact on domestic policy choice, making the costs of any government action to increase market prices above the prevailing world price more expensive. Open borders should also provide discipline on how industries price in the domestic market. With import restrictions such as tariffs in place, the non-competitive industry structures that raise prices in the domestic market can exist with limited fear of foreign competition. With freer trade, however, the industry faces more potential competition. When a free trade policy merges formally distinct markets for which stable industry structures exist, this creates additional incentives for mergers within the newly combined industry that reduce these gains from free trade. This analysis was motivated by observing the malting barley industry in Canada and the United States. In 1985, prior to CUSTA, the two domestic markets for barley malt were distinctly separated by import license requirements into Canada and import tariffs in the United States. As such, both countries had large malting industries, but there was little trade flow between the two countries in malting barley, in barley malt, or in beer. Four firms controlled 90 percent of the Canadian malting market, and six firms controlled over 80 percent of the U.S. malting market before CUSTA. As a result of mergers after CUSTA, five firms owned 90 percent of the malting capacity in North America. Economies of scale and elimination of high cost plants often drive industry consolidation. Interestingly enough, despite all of the merger activity among malting firms, there were very few plant closures and very little new capacity built. Even new entrants to either the United States or Canadian industries purchased the assets of existing firms, rather than building new plants. We review relevant literature for firm behavior and report the results of a model for the incentives for plant mergers in the North American malting industry following CUSTA. We evaluate malting firm profits, the changes in malting margins, the price effects, and the overall welfare effects of the creation of the free trade area and subsequent mergers within the industry. We found that free trade, in the absence of mergers, increases output in both countries and reduces malting margins leading to large gains for consumers and producers of malt barley. The agreement, however, also increases incentives for mergers. With the mergers that took place, we show that merging barley malting firms have incentives to decrease output by about 21 percent, while their producers' surplus increased by approximately 34 percent. The net benefits of free trade to consumers and input suppliers are reduced by mergers, while the profits of merging firms are increased by them. Overall, with free trade and mergers, there is still a net social gain relative to pre-CUSTA. Malt production in Canada increases by over 12 percent, while that in the U.S. is slightly lower, leaving North American consumers, firms, and barley producers better off.malting barley, industry concentration, free trade agreement, Industrial Organization, Q1, F1,

Experimental Investigations of Elastic Tail Propulsion at Low Reynolds Number

A simple way to generate propulsion at low Reynolds number is to periodically oscillate a passive flexible filament. Here we present a macroscopic experimental investigation of such a propulsive mechanism. A robotic swimmer is constructed and both tail shape and propulsive force are measured. Filament characteristics and the actuation are varied and resulting data are quantitatively compared with existing linear and nonlinear theories

A tabulation of pipe length to diameter ratios as a function of Mach number and pressure ratios for compressible flow

Computer programs and resulting tabulations are presented of pipeline length-to-diameter ratios as a function of Mach number and pressure ratios for compressible flow. The tabulations are applicable to air, nitrogen, oxygen, and hydrogen for compressible isothermal flow with friction and compressible adiabatic flow with friction. Also included are equations for the determination of weight flow. The tabulations presented cover a wider range of Mach numbers for choked, adiabatic flow than available from commonly used engineering literature. Additional information presented, but which is not available from this literature, is unchoked, adiabatic flow over a wide range of Mach numbers, and choked and unchoked, isothermal flow for a wide range of Mach numbers

Use of record-linkage to handle non-response and improve alcohol consumption estimates in health survey data: a study protocol

<p>Introduction: Reliable estimates of health-related behaviours, such as levels of alcohol consumption in the population, are required to formulate and evaluate policies. National surveys provide such data; validity depends on generalisability, but this is threatened by declining response levels. Attempts to address bias arising from non-response are typically limited to survey weights based on sociodemographic characteristics, which do not capture differential health and related behaviours within categories. This project aims to explore and address non-response bias in health surveys with a focus on alcohol consumption.</p> <p>Methods and analysis: The Scottish Health Surveys (SHeS) aim to provide estimates representative of the Scottish population living in private households. Survey data of consenting participants (92% of the achieved sample) have been record-linked to routine hospital admission (Scottish Morbidity Records (SMR)) and mortality (from National Records of Scotland (NRS)) data for surveys conducted in 1995, 1998, 2003, 2008, 2009 and 2010 (total adult sample size around 40 000), with maximum follow-up of 16 years. Also available are census information and SMR/NRS data for the general population. Comparisons of alcohol-related mortality and hospital admission rates in the linked SHeS-SMR/NRS with those in the general population will be made. Survey data will be augmented by quantification of differences to refine alcohol consumption estimates through the application of multiple imputation or inverse probability weighting. The resulting corrected estimates of population alcohol consumption will enable superior policy evaluation. An advanced weighting procedure will be developed for wider use.</p> <p>Ethics and dissemination: Ethics approval for SHeS has been given by the National Health Service (NHS) Multi-Centre Research Ethics Committee and use of linked data has been approved by the Privacy Advisory Committee to the Board of NHS National Services Scotland and Registrar General. Funding has been granted by the MRC. The outputs will include four or five public health and statistical methodological international journal and conference papers.</p&gt