PEANUT QUOTA MARKETS AND PEANUT PRODUCTION AFTER FAIR

The U.S. peanut program has limited peanut production since 1949. Unlike the programs for grains, cotton, and rice, the 1996 FAIR Act left the peanut program largely intact. As before FAIR (and since 1977) the right to grow peanuts for the domestic edible market is embodied in marketing quota, which can be leased and sold. The FAIR Act for the first time allowed quota movement across county lines. We now have four years of experience with peanut quota markets post-FAIR. In some parts of the country, quota has moved as much as the regulatory caps allow. But in most of the traditional peanut-growing areas of the Southeast there has been little cross-county movement. In this paper we analyze a large county-level panel of pre- and post-FAIR data to assess the effects of these changes in policy. We have compiled from USDA-FSA sources data on quota movements for virtually every peanut-producing county in the seven major peanut-producing states. We use these data to test microeconomic predictions of the effects of the loosening of transfer restrictions. Analysis of the data shows large quota movements in areas where observations on additionals production and lease rates would have predicted such. We find that movements in production, as distinct from movements in quota, cannot be explained entirely by FAIR, but can reasonably be attributed to changes in the profitability of growing competing crops such as cotton. The reduced profitability of the latter might itself be attributed in part to the elimination of cotton deficiency payments.Agricultural and Food Policy,

AN EMPIRICAL ANALYSIS OF HONEYBEE POLLINATION MARKETS

Pollination by honeybees plays an important role in modern agriculture. Some crops are greatly dependent on honeybees (almonds, apples, avocados, blueberries, and cherries are examples) while the yields and quality of other crops are significantly enhanced by honeybee pollination. The importance of understanding pollination markets has increased recently due to changes brought on by the twin scourges of Varroa and tracheal mites. Both are infestations of feral and domestic bees that imply greater future reliance on domesticated bees at higher cost. In the United States a complex market has evolved that connects itinerant beekeepers and their bee colonies with farmers who demand their services. While the fields of entomology and crop science have developed a large literature on general principles of beekeeping and its application to particular crops, there has been little economic analysis of pollination markets. In this paper, we begin to remedy this lack of attention by analyzing an extensive panel data set of individual pollination transactions for Oregon beekeepers. The Oregon panel constitutes a considerably larger and richer data set on pollination markets than the data set examined by Cheung (1973), which is our only empirical precedent. Using cross-sectional time series regression models, we find results that are consistent with Cheungs earlier findings on the consistency of pollination market outcomes with economic theory. Fees charged for placing colonies on crops that yield marketable honey are found to be less than for crops that yield no honey income to the beekeeper: the pollination fee for crops that produce honey is about $17 per colony less than for crops that produce no honey. Pollination fees also vary over time in response to changes in both crop prices and honey prices. Because bees are paid according to their value of marginal product in the production of crops, pollination fees should vary positively with crop prices. We find that a ten percent increase in crop prices causes pollination fees to increase by about$.40 per colony. With respect to honey prices, we find that a ten percent increase is estimated to decrease pollination fees by about $2.50 per colony. This estimated effect is a previously unexplored link between the now-defunct honey program and its longstanding public policy rationale, the encouragement of honeybee pollination. Insofar as the honey program successfully maintained the price of honey above levels that would otherwise have been observed, our analysis suggests that elimination of the program has resulted in a reduction in pollination services and an increase in pollination fees.Marketing,

THE END OF SUPPLY CONTROLS: THE ECONOMIC EFFECTS OF RECENT CHANGE IN FEDERAL PEANUT POLICY

The paper analyzes recent changes in U.S. peanut policy as enacted in the 2002 Farm Security Act. A model representing the impact of the 2002 farm bill on the domestic and foreign prices of edible peanuts is constructed and the gains and losses to peanut producing states are measured.Agricultural and Food Policy,

The New Deal, Race, and Home Ownership in the 1920s and 1930s

Many federal government housing policies began during the New Deal of the 1930s. Many claim that minorities benefited less from these policies than whites. We estimate the relationships between policies in the 1920s and 1930s and black and white home ownership in farm and nonfarm settings using a pseudo-panel of repeated cross-sections of households in 1920, 1930, and 1940 matched with policy measures in 460 state economic areas. The policies examined include FHA mortgage insurance, HOLC loan refinancing, state mortgage moratoria, farm loan programs, public housing, public works and relief, and payments to farmers to take land out of production.

The Effect of the GATT on U.S. Peanut Markets

The Uruguay Round of the General Agreement on Tariffs and Trade (hereafter, the GATT), which is to be signed by more than 10 nations on December 15, 1993, represents the culmination of seven years of negotiations on reforms of international trade. Assuming that the U.S. Congress will ratify the agreement, most, if not all, agricultural commodities produced in the United States will be affected in some way. The purpose of the present paper is to examine the likely effects of the GATT on U.S. peanut markets. Although the market value of U.S. peanut production is small compared to many other U.S. agricultural commodities, the impacts of the GATT on peanut markets are of considerable interest for at least two reasons