Induced-Innovation and Invasive Species Management

Public policy for managing invasive species has largely focused on preventive measures prior to detection (stage 1) and on the use of chemical/mechanical or biological control measures after the establishment and dispersion of the invasive species (stage 2). Optimal management policy depends both on the initial stock of the invasive species and on the costs associated with conventional control measures. However, little attention has focused on how an induced technology such as Bt corn and Bt cotton is developed and adopted by farmers (stage 3), or how it affects the manageability of economic and ecological damages from an invasive species. This analysis evaluates the optimal allocation of management resources between preventive and control measures for invasive species by incorporating induced technology under uncertainty into a conventional dynamic model of invasive species management.Invasive species, preventive measures, control measures, induced technology, hazard function, optimal control, comparative dynamic analysis, Environmental Economics and Policy, Production Economics,

The Edwards Aquifer Water Resource Conflict: Examining Impacts of USDA Programs

Resource /Energy Economics and Policy,

Structural Conservation Practices in U.S. Corn Production: Evidence on Environmental Stewardship by Program Participants and Non-Participants

This study used the 2005 ERS CEAP-ARMS data for corn production to first compare key operator, field, farm, economic, and environmental characteristics of conservation program participants with non-participants, by farm-size class. We then estimate a cost-function based technology adoption model of producer decisions regarding the allocation of field-level acres between corn production and infield and perimeter-field conservation structures to examine how these conservation choices differ between program participants and non-participants, while accounting for differences in other field, farm, and environmental factors. Our null hypothesis is that the average conservation structural practice acres across U.S. corn acres supplied by growers participating in a conservation program are not different from non-participants. Infield conservation structures include terraces, grassed waterways, vegetative buffers, contour buffers, filter strips, and grade stabilization structures. Perimeter-field conservation structures include hedgerow plantings, stream-side forest and herbaceous buffers, windbreaks and herbaceous wind barriers, field borders, and critical area plantings. Because the dependent variable in this analysis is continuous, we use a Generalized Estimating Equations (GEE) procedure to estimate two models. The GEE estimation procedure (Liang and Zeger, 1986) accounts for correlation between adoption decisions measured as a continuous variable while maintaining the theoretical integrity of a multinomial discrete-choice model typically used in technology adoption studies. The cost-function models estimate field-level, producer acreage allocation decisions for corn, first, as a function of normalized production input costs (prices) and structural technology class and installation time-period attributes (Model 1), and second, as a function of Model 1 variables plus socio-environmental variables reflecting the potential influence of a variety of field, farm, and environmental characteristics (Model 2). Evidence indicates significant characteristic differences exist between conservation program participants and non-participants across U.S. corn production, that non-program factors do heavily influence producer conservation practice decisions, and that farm-size matters. In addition, results suggest that program non-participants tend to adopt infield conservation structures much more intensively while program participants emphasize the adoption of perimeter-field conservation structures. Finally, these results seem to suggest that because perimeter-field structural practices can involve differential productivity/cost effects and off-site benefits, program incentives may need to play a greater role in encouraging their adoption than they do for infield structural practices.Crop Production/Industries, Environmental Economics and Policy,

Towards a Sustainable Future: The Dynamic Adjustment Path of Irrigation Technology and Water Management in Western U.S. Agriculture

Technology adoption, Water conservation, Irrigation, Dynamic groundwater models, Sustainable agriculture, Environmental Economics and Policy, Resource /Energy Economics and Policy,

A DECOMPOSED REGRESSION MODEL FOR MEASURING STRUCTURAL CHANGES IN THE FLOUR MILLING INDUSTRY

This paper presents a decomposed Poisson regression model based on count data that evaluates the size distribution, the changing number of flour mills for each size class, and the concentration of market power, simultaneously. This model also allows us to test dominant price leadership model.Agribusiness, Industrial Organization,

A Note on the Reliability Tests of Estimates from ARMS Data

USDA uses the concept of "publish-ability" rather than statistical reliability of an estimate for quality validation of USDA estimates, which is solely based on the sample size and the coefficient of variation (CV). We demonstrate conceptually how the reliability of the sample mean can be tested by estimating the upper and lower bounds of the confidence interval for an unknown population mean using the CV. However, the reliability test for the sample mean can be made only under the normality assumption. USDA multiple-way Agricultural Resource Management Survey (ARMS) estimates are used to illustrate the relative measure of precision for sample-based estimators.Research Methods/ Statistical Methods,

Working-Land Conservation Structures: Evidence on Program and Non-Program Participants

In recent years, the Federal government has placed more emphasis on working-land conservation programs. Farmers can be reimbursed for adopting certain conservation practices, such as the installation of in-field or perimeter conservation structures, to enhance water quality and soil productivity. In an effort to better understand the relationships between operator motivations, program incentives, and the environmental benefits of conservation programs, a multi-agency survey, the Conservation Effects Assessment Project-Agricultural Resources Management Survey (CEAP-ARMS), was conducted in 2004 across 16 states representing more than one-million farmers growing wheat. The nationally representative survey integrates Natural Resources Inventory (NRI) data on field-level physical characteristics, program information, farm-level costs of production, and farm household information. This objective of this paper is twofold. First, using the CEAP-ARMS, farm structure, household, and operator characteristics of farmers participating in one or more conservation programs are compared with farmers not participating in a conservation program. Second, an impact model is specified to test whether program participants allocated more acres to in-field or perimeter conservation structures than nonparticipants, holding other factors constant. Evidence suggests that program participants allocate more field acres to vegetative conservation structures than nonparticipants with in-field or perimeter conservation structures.Environmental Economics and Policy,

Biological Invasions: The Case of Soybean Aphid Infestation

Soybeans, the second highest cash crop following corn in the U.S., have come under attack by invasive species, the soybean aphid from the North and soybean rust from the South. We estimated the economic losses resulting from soybean aphid infestation by using a dynamic equilibrium model. Results indicate that, first, the reduction of soybean production resulting from soybean aphid infestation is largely absorbed by reducing soybean exports, due to the higher price elasticity of export demand compared to the domestic demand. Second, the economic losses to U.S. soybean producers would grow on average annually between $12.8 million and$23.4 million during the first five years of infestation. In the longer-run, soybean producers would suffer greater economic losses as the dispersion rate of infested soybean acreage with soybean aphids rises. However, the successful discovery of the soybean aphid gene (TF04048) Rag-1 (which confers resistance) does not at this time warrant soybean growers and policy-makers becoming too seriously alarmed. Even so, time is an important factor in the eventual control of the soybean aphid.Crop Production/Industries,

Economic Impacts of the U.S. Soybean Aphid Infestation: A Multi-Regional Competitive Dynamic Analysis

We estimated the economic benefits resulting from controlling soybean aphid infestation by using a multi-regional competitive dynamic equilibrium model. Results indicate that the reduction of soybean production resulting from a soybean aphid infestation is largely absorbed by reducing soybean exports, due to the higher price elasticity of export demand compared to domestic demand. Producer benefits resulting from controlling soybean aphids would increase by between $949 million and$1.623 billion in ten years under various scenarios. Results also suggest that it is economically more efficient to control soybean aphids when the rate of intrinsic growth is relatively lower, the supply price elasticity of soybean acreage is relatively more elastic, and insecticide treatment costs per acre are lower. However, if the discovery of the gene Rag-1 (TF04048) leads to new cultivars that withstand the soybean aphid, our estimates will overestimate the actual damages. Even so, our analysis demonstrates that it is critical to control soybean aphids early in their infestation cycle to avoid a rapid increase in damages.soybean aphid, invasive species, producer surplus, consumer surplus, Rag-1, Crop Production/Industries,

SALMON RECOVERY IN THE COLUMBIA RIVER BASIN: ANALYSIS OF MEASURES AFFECTING AGRICULTURE

The effects of salmon recovery measures on the Northwest agricultural sector are evaluated. Relevant recovery measures, such as: modified timing for dam releases, reservoir drawdown, and flow augmentation in the Columbia River basin, on the regional agricultural sector are evaluated. Combined, these measures would increase power rates, grain transportation costs, and irrigation water costs and reduce the supply of water to irrigators. We quantify these input cost and quantity changes and combine them into seven recovery scenarios for analysis. Results suggest that drawdown and/or minor reductions in irrigation water diversions would reduce producers' profits by less than 1% of baseline levels. However, the most extreme scenario-a long drawdown period combined with a large reduction in irrigation diversions-would reduce producers' profits by $35 million (2.5$35 million decline in annual profits, more than $27 million occur in southern Idaho and eastern Oregon. The federal government would bear these costs if it acquires water via voluntary transactions.Agricultural and Food Policy, Resource /Energy Economics and Policy,