Factor Price Risk and the Diffusion of Conservation Technology: Evidence from the Water Industry

The paper examines the influence of factor price risk on factor-use efficiency through the adoption of conservation technology. The effect of a mean-preserving increase in factor price risk on optimal input-use efficiency is shown to be conditional on the own-price elasticity of factor use evaluated at the initial equilibrium. The conceptual analysis indicates that that there may be a discrepancy between the aggregate and firm-level effects of price risk on efficiency. Theoretical results are tested and confirmed using a unique data set from the water industry.technology adoption; risk; conservation; water resources; ordered probit

Emerging Markets in Water: A Comparative Institutional Analysis of the Central Valley and Colorado-Big Thompson Projects

Water trading is a potential means to improve the productivity of developed water supplies and reconcile competing uses. Economic theory suggests that markets evolve in response to changes in supply and demand. This prediction is at odds with observed disparities in the pace of market development in regions facing similar pressures on scarce water resources. A dramatic example of this disparity is found in the regions served by the California Central Valley Project and the Colorado-Big Thompson Project.This article argues that the differences in market activity in the two areas can be explained largely by the underlying water allocation institutions. The article identifies key institutional features that affect the transaction costs of water trading and examines the rootsof the institutional diferences. The institutions governing market transactions today are largely a function of pre-existing property rights and political battles to build consensus and obtain federal financing for the projects. The article highlights the path-dependent nature of water allocation institutions and trading, but also suggests that complex inter-regional markets could still develop in California given ever-increasing competition for scarce water resources and advances in information technology that lower market transaction costs

SIMULTANEOUS ESTIMATION OF TECHNOLOGY ADOPTION AND LAND ALLOCATION

The paper considers the econometric modeling of technology adoption when crop choice is simultaneous. Bivariate probit is used to estimate a model of irrigation technology choice and land allocation using a unique field-level data set from California's Central Valley. Special attention is paid to the proper calculation of marginal effects in the bivariate probit model, which are often useful for policy purposes. Estimation results confirm that the choices of irrigation technology and land allocation are simultaneous. With regard to the influence of price incentives on agricultural water use, estimation results from the bivariate probit model indicate that the influence of water price on the adoption of precision irrigation technology is much larger than previously realized. A univariate model of technology choice that treats land allocation as exogenous underestimates the effect of water price on the adoption of precision technology by over 40 percent.Land Economics/Use, Research and Development/Tech Change/Emerging Technologies,

IRRIGATION TECHNOLOGY INVESTMENT WHEN THE PRICE OF WATER IS STOCHASTIC

The paper considers the effect of changes in the distribution of water price on the incentives to adopt water-conserving irrigation technologies. A two-stage decision model is developed wherein agents make long-term decisions about irrigation technology investments and decide production levels based on short-term realizations of water price. Comparative statics results show that the impact of changes in the distribution of water price hinge on the responsiveness of cultivated acreage to fluctuations in the price of water. The model is tested using data on irrigation technology investment from California's San Joaquin Valley. Econometric results strongly support the conceptual model, and show that changes in the distribution of water price have systematically different impacts on permanent and annual crops.Resource /Energy Economics and Policy,

Input Price Risk and the Adoption of Conservation Technology

Replaced with revised version of poster 07/12/11.price risk, technology adoption, matching, propensity score, Environmental Economics and Policy, Resource /Energy Economics and Policy, Risk and Uncertainty, Q1, Q5,

LOCAL PUBLIC GOODS AND ETHNIC DIVERSITY: EVIDENCE FROM THE IMMIGRATION REFORM AND CONTROL ACT

This paper uses county-level data from California to test whether ethnic fragmentation and other measures of diversity and social capital are systematically related to spending on productive local public goods that affect rural quality of life. The specific focus of this paper is the impact of the Immigration Reform and Control Act (IRCA) of 1986, which brought about 400,000 new immigrants to California, on demographic composition in that state.Public Economics,

Product Liability, Entry Incentives, and Industry Structure

Industrial Organization,

MEASURING THE GAINS FROM MANAGEMENT OF SPATIALLY HETEROGENEOUS RESOURCES: THE CASE OF GROUNDWATER

We develop a model for the dynamic management of spatially heterogeneous resources with multiple users. We apply our model to the case of groundwater and show that contrary to the results of existing studies even when externalities are highly concentrated in space, significant efficiency gains are possible over competitive outcomes.Resource /Energy Economics and Policy,

Land Allocation, Soil Quality and the Demand for Irrigation Technology

Land Economics/Use,

Application of Gearbox Drivetrains for Commuting Bicycles

People all over the world are beginning to ride their bicycles more often to destinations which include work, school, and local markets. Most bicycles being used for these activities have an external drivetrain exposed to the elements of the road including water, mud, dirt, and debris. External drivetrains are very fragile and when damaged, pedaling efficiency is greatly reduced and the overall riding experience diminishes. One solution to this issue is a gearbox specifically designed for a bicycle frame. A gearbox has several mechanical mechanisms operating inside a protective housing. Since the housing is fully sealed, outside elements are not able to contaminate the drivetrain system. A gearbox is also much more robust and requires less maintenance compared to a traditional external drivetrain. This project documents the designing and prototyping of a gearbox drivetrain for a bicycle using the manufacturing facilities in the Gene Haas Advanced Manufacturing Lab at Cal Poly. Software was used to create models and toolpaths for machining all of the parts. Computer numeric controlled machines were used to manufacture and inspect all of the metal parts that would then be assembled into a functioning gearbox