Employing Real Options Methodology for Decision Making in Greenhouse Technology

Latest developments in investment analysis offer a number of valuable insights into how to evaluate investment opportunities encountering the weaknesses of net present value criterion. More specific, irreversibility, uncertainty and the choice of timing are conditions that net present value does not include but they alter the investment decision in critical way. Employing contingent claims analysis in tangible investments several assumptions made by discount cash flow method are concerned and better assessment results can be derived. In this work, an attempt is made to apply real options methodology in agricultural investments. Many agricultural investors face a growing uncertainty environment with high sunk investments and net present value criterion has been extensively used that may be lead to incorrect decisions. Both discount cash flow method and real options approach are employed to evaluate the effectiveness of a new technology project under uncertainty returns in agriculture. Discount cash flow approach indicates that the adoption of a new technology project under uncertainty is feasible while real options approach differentiates the results. The corollary is that real options approach can be proved conducive in assessing projects with uncertainty and irreversibility and it can furnish a new way of examining agricultural investment decisions.real options, irreversibility, option value, agriculture, investment, policy, Crop Production/Industries,

The “not-so-modern” consumer – considerations on food prices, food security, new technologies and market distortions

Although food quality and food safety issues seem to dominate discussion and research in Europe, price inflation and economic recession may pose questions over food abundance over the coming years. For the first time since the early seventies, market stability for a number of commodities is seriously questioned. The paper tackles the fluctuation of food prices in the last decade and the reasons behind recent record prices in a series of commodities, trying to investigate whether food shortages may create new problems, even for relatively economically stable nations. Lowering stock levels that induce price volatility, production shortfalls due to adverse conditions that are often correlated to climate change, oil prices, changing diet patterns in regions that have become more affluent in recent decades, trade policies that often contradict one another, financial speculation in food markets all play a distinct role forming today’s reality. The effect of rising food prices is crucially important, at the microeconomic level, for poorer households. The paper tries to investigate whether food security problems -in the sense that all people, at all times, have economic access to sufficient, safe and nutritious food to meet their dietary needs and food preferences for an active and healthy life- may become increasingly important in Europe in the future, as well as the necessary policies to protect those most vulnerable.food insecurity, biofuels, food prices, market distortion, financial speculation, Agricultural and Food Policy,

Multilateral or Regional Agreement: The Case of Mediterranean Non-EU Countries

Middle East and North Africa (MENA) countries are at a crossroad regarding potential trade reforms. The EU is not only the world's largest market for the region's agricultural products, but also remains the prime outlet for these Mediterranean countries' exports. An applied general equilibrium model is used to assess the impact of various trade reform options in the region. Results suggest that the region might benefit most under special provisions for developing countries. Under global trade reform, MENA preferences with EU might be eroded, with EU Mediterranean countries like Greece benefit the most with global trade reform.International Relations/Trade,

Preserving Ecosystem Services via Sustainable Agro-food Chains

Today, agro-food chains constitute a focal point of critique from multiple perspectives – economic, environmental and societal – for their powerful yet quiescent role in promoting a secure path towards sustainable development. Effective and sustainable food systems accompanied by responsible use of ecosystem resources/services and societal concern can successfully meet current and future challenges. The need for sustainability, from both the demand and the production point of view, is situated at the core of policy objectives for the development of agro-food chains. In this context, the 164th EAAE Seminar organized in Chania, Greece, 5-7 September 2018, covered the topic “Preserving Ecosystem Services via Sustainable Agro-food Chains”, focusing on the necessity for sustainable food chains in a viable ecosystem analyzing their wide spectrum of interlinkages

Factors Affecting the Competitiveness of the Greek Wine Enterprises and Cooperatives

The present paper investigates the effect of certain economic factors on the competitiveness of Greek Wine Enterprises and Unions of Agricultural Cooperatives (UACs). Data on 41 wineries and 10 UACs of Greece was collected for a period of three years (2004-2006). Financial analysis results were used with the help of a fixed effect model-panel data technique- using profitability as dependent variable in order to measure the competitiveness of wineries. The results indicated that the size of the enterprise as well as the square of the capital intensity have a positive influence on the winery’s profit.competitiveness, profitability, wineries, agricultural cooperatives, Agribusiness,

Agro-Food Dynamics in a Region's Growth

Regional development depends highly in the allocation of developing funds -through development policies- among the various sectors of regional economies. In order to safeguard the most efficient use of investments analytical tools visualizing the economy as a whole in the form of a general equilibrium should be adopted. In this paper the role of agro-food sectors and agriculture in regional economic growth is examined. Despite the diminishing contribution of agriculture and agro-food sectors in the formation of an economy’s gross output and employment, their indirect influence upon the rest of the economy most of the times is not completely cast up. It is evidence that over the last two decades the share of agriculture in Greece’s GDP is substantially dropped. This fact many times used as a guide to support decisions in directing regional developing funds far from agriculture. On the other side, food sector’s share in processing industries is growing and its contribution and interrelation with other sectors has not been well assessed. Thus in the present paper, the indirect contribution of agro-food sectors in a region’s economy is measured and compared to non-agricultural sectors. Linkage relationships and interdependencies between food and non-food sectors are sought and their role in strengthening the regions growth is contemplated. The identification of such relationships is very important, as the path to development in some regions is very sensitive to sectoral interdependencies. To accomplish the aforementioned objectives, an Input-Output framework was employed in a regional level (Thessalia, Greece). Utilizing an employment based Location Quotient (LQ), developed by Flegg et al (1995) -the FLQ- the national I-O table is regionalized for the Greek (NUTS 2) region. The regionalization procedure was performed by following the hybrid GRIT technique. Employing the regional I-O table, linkage coefficients, that identify the dynamics of key sectors, were estimated. In addition the regional output generated due to food sector and non-food sector activity traced out to compare the relative dynamics. Results clearly demonstrate that the nexus of food non-food sectors is determinant in regional growth plans and the particular interdependencies, in every particular region, must carefully considered.

Fisheries policies impacts consideration towards the development of rural coastal areas

The current study aims to examine the effectiveness of fisheries policies and specifically of the Greek Operational Programme for Fisheries, 2007-13. In specific, aims to examine and assess possible impacts generated, in the regional economy of Voreio and Notio Aigaio from its four axis, with particularity to the forth one. For this a regional Input-Output model was built in order to capture direct and indirect impacts in terms of output, employment and income. Results indicate that the dynamics of the fisheries sector in the regional economy are very weak and along with the continuous shrinking of the sector, leads to the necessity of supporting alternative vocational activities for the development of coastal rural areas. Though, results indicate that the funds attributed to such policies are very small, resulting in very weak generated impacts in the regional economy. And thus it is not expected current policies to seriously affect the development of such regions through the promotion of alternative to fishing activities.rural coastal areas, operational fisheries programme, impact analysis, regional analysis, Community/Rural/Urban Development, R11, R15, R58, Q22,

Potential on Using Cultural Syndromes for Explaining Differences in Attitudes in Northern and Southern EU Countries

Nowadays, it is more realistic to view the development of a new technology as a result of a complex social system of interactions and decisions. Understanding the public's range of views on biotechnology is important for decision makers, in order to be able to anticipate potential acceptance problems or, one step further, to take consumer or public desires and concerns into account so that desirable applications can be developed. Previous work from the same research group, using data from Eurobarometer surveys, was trying to explore the attitudes of the European consumers towards genetic modification of food. Emerging differences in attitudes towards genetically modified food have not been explained adequately in most cases using only sociodemographic variables. In addition strong national differences lead to the idea that cultural differences should also be taken into account, despite the difficulties in formulating specific hypotheses that can be tested empirically. In this paper, in an effort to approach culture in a more clear way, we try to track down and analyse the specific units (customs, traditions, beliefs, and other social norms) that comprise cultures. The notion of cultural syndromes as approached by Triandis is tackled. Furthermore applying data from the European Social Survey (ESS) to Schwartz's value system, our objective is to validate empirically the potential utilisation of Schwartz values to further explain existing differences in attitudes towards GM food among European countries. Further research can lead to a deeper and more precise understanding of cultural differentiation as well as to a more valid cross-cultural theory of attitude formation.attitudes towards genetically modified food, attitude formation, cultural differentiation, cultural syndromes, Consumer/Household Economics,

Estimating the Impact of Trade Costs on Agricultural Productivity

Utilizing a new measure of trade costs, this study tries to provide first evidence of the link between trade costs and productivity in the agricultural sector. Using a panel data of readily available data, across the 34 OECD member countries, this paper tries to assess and estimate the impact of trade costs on agricultural sector productivity for the 1995 – 2014 period. According to the results, there is strong evidence that when the agricultural sector faces lower trade costs, it tends to be more productive and there is some evidence that it experiences higher productivity growth too

Middle East and North Africa countries' agricultural export potentials under trade reforms

Middle East and North Africa (MENA) countries future stand in the world's economy depends to a large extent on the potentials of their agriculture to perform in a free trade world. EU is the largest market for agricultural products of MENA countries, though new outlets and new partnerships can expand the market of their produce. Enhancing agriculture's potentials safeguards the economy's general expansion and impede the flee of MENA countries' huge labor reserves to the developed world. In this work, introducing a few possible trade reforms, a general equilibrium model is employed to assess the impacts upon region's export potentials and welfare changes. Selecting certain distinct scenarios from a wide spectrum of anticipated trade reforms, and feeding them into the model, insights on the direction of the expected changes and rough estimates of accrued benefits can be extracted. The model results suggest that the region might benefit the most under special provisions for developing countries in a WTO agreement, while in the case of EU-Med agreement agricultural trade will benefit MENA countries and can induce economic growth through the expansion of agricultural exports