THE ORGANIZATION OF AGRICULTURAL EXPORTS: LESSONS FROM REFORMS IN ISRAEL

International Relations/Trade,

RURAL TOURISM: DEVELOPMENT, PUBLIC INTERVENTION AND LESSONS FROM THE ISRAELI EXPERIENCE

Community/Rural/Urban Development,

An Optimal Size for Rural Tourism Villages with Agglomeration and Club-Good Effects

Helping to sustain a viable rural sector, rural tourism enjoys public support in many countries. We claim that due to club-good and agglomeration externalities in the rural accommodation market, public support should be integrated in a broader local development policy that regulates the number of accommodation units in a locality. To demonstrate this we extended an equilibrium model that accounts for product differentiation and oligopolistic competition to address club-good and agglomeration effects and applied it to data collected in north Israel. We show that under the prevailing regulation, the number of units is by far higher than the social optimum.Community/Rural/Urban Development, International Development, Political Economy,

ON A POLITICAL SOLUTION TO THE NIMBY CONFLICT

Political Economy,

Competitive Equilibrium of an Industry with Labor Managed Firms and Price Risk

This paper studies the effect of output-price uncertainty in an industry comprised of labor-managed firms (LMFs) in which the number of LMFs and their membership are determined endogenously. The exit condition for a risk-averse LMF member is formulated and the effect of various economic variables on the equilibrium quantities and prices are examined. We find that the equilibrium in our setting is similar to the one that emerges in a ‘capitalistic’ economy where firms are owned by profit-maximizing agents. However, the effects of increases in risk and risk aversion differ from those found in a short-run analysis of a single LMF.Labor Managed Firms, Cooperatives, Price Risk, Risk Aversion, Long-Run., Agribusiness,

REGULATING IRRIGATION VIA BLOCK-RATE PRICING: AN ECONOMETRIC ANALYSIS

In this paper, we adapt Burtless and Hausman's (1978) methodology in order to estimate farmer's demand for irrigation water under increasing block-rate tariffs and empirically assess its effect on aggregate demand and inter-farm allocation efficiency. This methodology overcomes the technical challenges raised by increasing block rate pricing and accounts for both observed and unobserved technological heterogeneity among farmers. Employing a micro panel data documenting irrigation levels and prices in 185 Israeli agricultural communities in the period 1992-1997 we estimate water demand elasticity at -0.3 in the short run (the effect of a price change on demand within a year of implementation) and -0.46 in the long run. We also find that, in accordance with common belief, switching from a single to a block price regime, yields a 7% reduction in average water use while maintaining the same average price. However, based on our simulations we estimate that the switch to block prices will result in a loss of approximately 1% of agricultural output due to inter-farm allocation inefficiencies.Block-Rate Pricing, Irrigation, C13, Q15, Q28, Resource /Energy Economics and Policy,

RELAXING THE EXPECTED UTILITY HYPOTHESIS AND ENTRY/EXIT DECISIONS OF THE RISK-AVERSE FIRM

A risk-aversion theory is formulated directly from a preference relation, rather than with a utility function representation. An example concerning insurance demand provides intuitive support. This theory is applied to analyze firms' entry/exit decisions, the long run equilibrium of an industry and comparisons between firms with different risk attitudes

Introducing socioeconomic characteristics into production analysis under risk

A theoretical framework is developed to study the effects of socioeconomic factors on farmers' risk attitudes and production decisions. No maintained assumptions about the individual's utility are required. A key element in this framework is the categorization of socioeconomic factors by their effect on the farmer's risk attitudes. A simple methodology for this categorization, based on the equivalence between the Arrow-Pratt measure of risk aversion and the probability of winning demanded, is proposed. The latter is illustrated with data collected in a survey of 180 Israeli farmers from 20 villages