Does accounting for inefficiency affect the time-varying short and long-run returns to scale?

The returns to scale for nineteen South Asian countries are estimated using window and cumulative rolling stochastic frontier regression analysis. The stochastic frontier analysis accounts for technical inefficiency of Hicks non-neutral technology production function in the estimation of the returns to scale. The window rolling regression and cumulative rolling regression allows the estimation of short and long run time-varying returns to scale, respectively. Empirical application to Asian agriculture sector using Food and Agricultural Organization data from 1961-2008 indicates returns to scale are under (over) estimated by the traditional panel models in the short (long) run time-varying estimation. The time-varying estimates of returns to scale indicate decreasing trend in the short run compared to long run analysis. --Asian agriculture sector,stochastic frontier analysis,window and cumulative time-varying input elasticities and returns to scale,one-way fixed effect,1961-2008

FARM PROGRAMS AND LAND VALUES IN MOUNTAIN STATES: ALTERNATIVE PANEL ESTIMATORS

Relative proportion of agricultural land values generated by farm program payments, farm returns, and non-farm activity in the mountain region and the U.S are estimated for the period 1939 to 2005. Results suggest the contribution of farm program payments to agricultural land values in the mountain region and the U.S. is quite similar and robust across the four alternative panel estimators for the period, 1939-2005. The contribution of the farm returns to value of land is lower in the mountain region compared to the U.S. The contribution of non-farm activity to the land values is higher for the U.S. compared to the mountain region. The relationship between farm program payments and farm returns are positive in mountain region and negative for U.S.Mountain region and U.S., Agriculture land values, Farm program payments, Farm returns, Non-farm activity, Alternative Panel Estimators, Historical data, 1939-2005, Agricultural and Food Policy, Land Economics/Use,

Environmentally Adjusted Elasticity Measures

Here, using input, output and nitrogen pollution data related to one state, we propose to extend the elasticity concept to include environmental pollution treated as undesirable output to provide the environmentally adjusted elasticity measures for the period, 1936-1997 in a two-step procedure.Environmental Economics and Policy,

Role of Panel Analysis in Identifying Asymmetric Information with Optional Unit Provision in Federal Crop Insurance

This paper has a two-fold contribution, first we demonstrate the relationship of spatial, temporal and residual yield risk estimated from a two-way panel random effects model to asymmetric information with an optional unit provision in the federal crop insurance program. Second, the yield risk components are incorporated in a discrete choice model to examine the presence of asymmetric information due to potential yield switching with optional unit provisions. Empirical application to 1998 U.S. cotton crop insurance data reveals the presence of asymmetric information with optional unit provisions.Adverse Selection, Moral Hazard, Optional Unit Policy, Crop Insurance, U.S. Cotton, Crop Production/Industries, Demand and Price Analysis, D82, G22, Q10,

AGGREGATION ISSUES IN THE ESTIMATION OF MALMQUIST PRODUCTIVITY MEASURES

The paper contributes by demonstrating the sensitivity of nonparametric programming productivity measures to the choice of model –time series versus panel models of Malmquist productivity, and to various levels of commodity aggregation compared to the traditional Tornqvist-Theil index approach employing U.S. state-level data from 1960-96. To illustrate the sensitive of nonparametric programming productivity measures, we compare the implicit shadow shares recovered from the dual values of the Malmquist productivity and total factor productivity methods to the observed shares of the Tornqvist-Theil index for U.S level data from 1948-1994.Tornqvist-Theil Index, Time series, and Panel models, Malmquist productivity and Malmquist total factor productivity programming, Share-weights., Productivity Analysis, O3, C6, Q1,

INDIAN STATE-LEVEL SORGHUM PRODUCTIVITY MEASURES

This paper has a three fold contribution to the existing literature - 1) Indian state level sorghum input and output data for the period 1970-71 to 2000-01 is collected, 2) non-parametric linear programming productivity measures are estimated, and 3) examine the impact of policy variables like percent of high yielding varieties, percent under irrigation, and herfindahl index of seasonal production (rabi and kharif) on productivity using two way random effects panel modelProductivity Analysis,

Dynamic Relationships Between Farm Real Estate Values and Federal Farm Program Payments

This study examines the dynamic relationships among farm real estate values, farm returns, farm program payments, and real interest rates in an income capitalization model. Endogeneity is assumed among the variables in a dynamic framework because the direction of causality is unclear from a theoretical standpoint. The analysis encompasses the period beginning with the introduction of the first farm bill in 1933 and ending in 2006. Results indicate farm program payments have positive direct impacts in the short run and positive indirect impacts (via farm returns) in the long run on farm real estate values.dynamics, farm program payments, farm real estate values, U.S. data 1933 – 2006, vector error correction model, Agricultural and Food Policy, Land Economics/Use,

The Impact of Trade Openness on Technical Efficiency in U.S. Agriculture

This study addresses the impact of trade openness on technical efficiency in the U.S. agricultural sector. The results indicate that trade protectionism illustrated with a decrease in the share of agricultural imports in agricultural GDP led to an increase in technical efficiency. A change in the share of agricultural exports in agricultural GDP had no impact on technical efficiency. These results are partially consistent with the premise of the new trade theory, but also seem to be driven by the intricacies of the agricultural sector and agricultural policy in the US and internationally.Agriculture, Technical Efficiency, Trade Openness, United States, International Relations/Trade, Production Economics, Q17,

The Impact of Trade Openness on Technical Efficiency in U.S. Agriculture

This study addresses the impact of trade openness on technical efficiency in the U.S. agricultural sector. The results indicate that trade protectionism illustrated with a decrease in the share of agricultural imports in agricultural GDP led to an increase in technical efficiency. A change in the share of agricultural exports in agricultural GDP had no impact on technical efficiency. These results are partially consistent with the premise of the new trade theory, but also seem to be driven by the intricacies of the agricultural sector and agricultural policy in the United States and internationally.Agricultural Finance, International Relations/Trade,

Nature of Dynamic Relationships Between Farm Real Estate Values and Federal Farm Program Payments

The objective of this study is to test the dynamic relationships among variables including farm real estate values, farm returns, farm program payments, and real interest rates in an income capitalization model. Our analysis is unique in multiple ways: (1) it covers the period beginning with the introduction of the first farm bill in 1933 through 2006; (2) assumes endogeneity of the variables, and (3) develops a dynamic modeling framework. Endogeneity is assumed among farm real estate values, farm program payments, and farm receipts since the direction of causality is unclear from a theoretical standpoint. Results indicate that policy makers are reactive rather than pro-active in making transfers to farmers. Once farm program payments are implemented, payments have positive impacts only in the short run on the value of farm real estate. However, considering endogeneity, the model suggests that it is possible that farm program payments have a lasting positive indirect impact (via farm returns) on the value of farm real estate.Dynamics, Farm programs payments, Farm real estate values, Vector error correction model, U.S. data, 1933-2006, Agricultural Finance, Farm Management, Q18, H50, C32,