Twenty years of land reforms in Central and Eastern Europe: state of play and outlook

The purpose of this article is to gain a perspective on the land reforms in the Central and Eastern European countries to show the extent to which the structure of agricultural production left by the socialist period has influenced the restructuring dynamics. In this context, the observed dual agricultural structure is seen as the result of a sticking point exacerbated by the agricultural transition’s land component.transition, land reforms, property rights, initial situation

Armington elasticities and tariff regime: An application to European Union rice imports

Most of the European Union’s (EU) import sources for rice are in developing countries and the least-developed countries (LDCs). The EU has moreover made a commitment to allow duty-free and quota-free access to rice imports originating in the LDCs from September 2009 onward. The purpose of this article is to answer two questions – First: Does the inclusion of import tariffs in the specification lead to different estimated Armington elasticities? Second: When a discriminating tariff is introduced, what happens to the market share of large rice exporters to the EU, especially to the market share of poor countries? Consequently, we present the Armington model, derived from a constant elasticity of substitution (CES) utility function, and a non-homothetic CES utility functional form, which is more flexible. Then, we estimate the Armington model, with and without the inclusion of a tariff, and we compare the elasticities. Lastly, we model five scenarios with different discriminating import tariff rates to calculate the changes in the market access of large rice exporters to the EU. Our empirical results show that it is worthwhile to consider non-homothetic preferences and import tariffs. When the model is estimated, ignoring the import tariffs and the non-homothetic parameter, results may be biased and of uncertain validity. Furthermore the simulation findings demonstrate that in spite of a large difference between import tariff rate of Suriname and other countries (scenario V), its market access would not change greatly. This may be caused by supply side problems like poor infrastructures, weak technology and small capacity production in LDCs.Armington elasticity, tariff discrimination, non-homothetic, utility function, EU, rice.

Does the regulation of manure land application work against agglomeration economies? Theory and evidence from the French hog sector

The well-known increase in the geographical concentration of hog production suggests the presence of agglomeration economies related to spatial spillovers and inter-dependencies among industries. In this paper, we examine whether the restrictions on land application of manure may weaken productivity gains arising from the agglomeration process. We develop a model of production showing the ambiguous spatial effect of land availability and the restriction on the manure application rate. Indeed, while the regulation of manure application triggers dispersion when manure is applied to land as a crop nutrient, it also prompts farmer to adopt manure treatment that favors agglomeration of hog production. Estimations of a reduced form of the spatial model with a spatial HAC procedure applied to data for French hog production for 1988 and 2000 confirm the ambiguous effect of land limitations induced by the restrictions on manure application. It does not prevent spatial concentration of hog production, and even boosts the role played by spatial spillovers in the agglomeration process.hog production, land availability, manure application regulation, agglomeration economies, spatial econometrics

The International Strategy of Firms: the Role of Endogenous Product Differentiation

We study the impact of trade liberalization on the international strategy of firms (to export and/or invest abroad as well as the number of products to be produced and exported) when product differentiation is endogenous. By considering product differentiation as a strategic variable, our analysis sheds new light on the impact of trade barriers on the decision to produce abroad and on the choice of product range, in accordance with recent empirical evidence. Indeed, we show that, even though technology exhibits the same productivity for each variety, firms drop some varieties with trade integration. In addition, our results reveal that, contrary to the standard theoretical literature, the relationship between the decision to export and trade costs is non-linear. When trade costs are relatively high, each firm export and is multi-product. Then, when trade costs take intermediate values, firms may invest abroad and the choice of producing abroad results from a prisoner's dilemma game. Finally, when trade costs are low, firms export but become single-product.Foreign direct investment, exports, multi-product competition, endogenous differentiation product, trade integration

The role of public subsidies on farms’ managerial efficiency: An application of a five-stage approach to France

This paper applies a five-step approach to the investigation of the relationship between public subsidies, namely CAP direct payments, and managerial efficiency for French COP and beef farms in 2000. Managerial efficiency scores are calculated using a four-step approach that allows disentangling managerial inefficiency from unfavourable external conditions. Then, in a fifth stage, managerial efficiency scores are regressed over a set of explanatory variables, including CAP direct payments. Using individual farm data and meteorological data at the municipality level, we show that there is a non negligible component of inefficiency that is due to unfavourable conditions, and there is a strong significant negative relationship between managerial efficiency and CAP direct payments.technical efficiency, managerial efficiency, direct payments, farms, France

Patterns and determinants of urban chicken consumption in Haiti and Cameroon: similar contexts, differentiated prospects

Since the beginning of 2000s, in order to let poor people accede to meat consumption, several African and Caribbean countries have opened their domestic chicken market to foreign imports, by reducing import tariffs. Thus imported frozen pieces of chicken from the European Union or America compete with local chicken meat, causing the collapse of many poultry husbandry and the loss of many jobs in the local chicken food chain. In order to highlight the determinants of urban consumer’s choice relative to chicken types, and assess the opportunity for local chicken to restore its market share, investigations have been done in 2005 in Yaoundé (Cameroon) and in 2006 in Port-au-Prince (Haiti) applied to 180 urban households in each country. While imported frozen pieces of chicken have almost entirely substituted for the local chicken which has already quite disappeared in Port-au-Prince, Yaoundé consumers still prefer the local flesh chicken to the imported ones, at least for particular uses.chicken, urban consumption, developing countries, globalization, Cameroon, Haiti

Border Effects and East-West Integration

A new method for measuring trade potential from border effects is developed and applied to manufactured trade between the old fifteen European Union (EU) members and twelve Central and East European (CEE) economies. Border effects are estimated with three theoretically compatible trade specifications, and much larger trade potentials are obtained than predicted by usual trade potential models. Even after a decade of regional trade liberalization, the integration of CEE and EU economies is two to three times weaker than intra-EU integration, revealing a large potential for East-West European trade.Trade potential, regional integration, border effects

Simple econometric models for short term production choices in cropping systems

The aim of this article is to present new models of acreage choices to describe short term production choices. Its construction combines concepts developed in the Positive Mathematical Programming and Multicrop Econometric literatures. They consider land as an allocable fixed input and motivate crop diversification by decreasing returns to crop area and/or implicit costs generated by constraints on acreage choices and by limiting quantities of quasi-fixed factors. Attractive re-parametrization of the standard quadratic production function and different functional forms for cost function are proposed to have parameters easily interpretable and to define econometric models in a very simple way.Acreage share; Production function; Multicrop econometric model; Positive Mathematical Programming

Do we need handshakes to cooperate in buyer-supplier relationships?

Does formal contracting foster cooperation in a buyer-supplier relationship? In line with the literature, we find that a renegotiable contract with relationship-specific joint investments does not make it possible to reach the first-best. However, we show that a renegotiable contract may induce more cooperation than an informal arrangement. This result may help to understand how cooperation emerges in Japanese procurement practices, which typically involve relationship-specific joint investments and renegotiable contracts.Incomplete contracts, relationship-specific investments, cooperation

Applying the gravity approach to sector trade: Who bears the trade costs?

Thanks to its empirical success, the gravity approach is widely used to explain trade patterns between countries. In this article we question the simple application of this approach to product/sector-level trade on two grounds. First, we demonstrate that the traditional Armington version of gravity must be altered to properly account for the fact that sector expenditures are not strictly equal to sector productions because some trade costs are incurred outside the sector of interest. Secondly, we test empirically the mis-measurement of the expenditures with both Armington (1969) and Helpman and Krugman (1985) approaches. We estimate trade flows and prices simultaneously with non linear techniques. Underestimated expenditure levels yield biased values of model parameters.gravity, trade, econometric simulation