We use an unusual dataset involving 14 tomato growers over 4 years to analyze the effect of incentive contracts on behavior in a fixed effects econometric model. We find that growers respond to incentive contracts by improving tomato quality, as predicted by economic theory. The comparison is not confounded by the usual contract endogeneity and simultaneity problems because of characteristics of the processing tomato industry and our dataset. We discuss the implications of our findings for the design of agricultural contracts.

The U.S. broiler industry is highly vertically integrated and increasingly concentrated in the number of firms and production areas. These structural elements could have implications for performance and the functioning of the law of one price (LOP) across regions. This article investigates this using data on four regional markets. Cointegration results indicate that regional prices are spatially linked in the long run, but pairwise cointegration was not found, suggesting that the LOP does not hold. Causality tests confirm the relative importance of price shocks from the South. This finding is reflective of price coordination by firms with production in multiple regions.

Data from a national survey of food shoppers are analyzed by probit and ordered probit models that incorporate elements of Lancaster's product attribute model and Weinstein's precaution adoption process. The models are used to investigate the characteristics of organic and nonorganic food shoppers. Where one shops, food beliefs, and food knowledge have the largest significant impact on the probability that shoppers buy organic food. Among the demographic characteristics, only the lack of religious affiliation, higher education, and youth are significant explanatory variables.

The effects of the exchange rate and the income and money supply of the United States and its major trading partners on the U.S. agricultural trade balance are examined using an autoregressive distributed lag (ARDL) model. Results suggest that the exchange rate is the key determinant of the short- and long-run behavior of the trade balance. It is also found that the income and money supply in both the United States and the trading partners have significant impacts on U.S. agricultural trade in both the short and long run.

This article addresses the issues of the potential impacts of the introduction of black sigatoka into Puerto Rico under situations in which the government assists growers in managing the spread of the disease, with and without prohibitions on imports of plantains and bananas. An equilibrium displacement model is used to quantify the impact of black sigatoka. The results indicate that under both scenarios the net economic benefits to society were negative. Over the long term, the government would be well-advised to invest in research to develop plantain and banana varieties that are resistant to black sigatoka.

Farm Service Agency (FSA) direct loans are intended to provide transitory credit to creditworthy borrowers unable to obtain conventional credit at reasonable terms. Farm loan program (FLP) effectiveness is measured in part by how readily direct loan borrowers graduate to conventional credit. A survey of FSA borrowers originating direct loans during fiscal years 1994-1996 is used to estimate graduation rates. A majority of 1994-1996 loan originators did exit the direct FLP by November 2004. A multinomial logit model indicates financial strength at origination resulted in greater likelihood of farming without direct loans approximately 9 years after loan origination.

Contagious animal diseases like foot-and-mouth disease (FMD) are often referred to as economic diseases because of the magnitude of economic harm they can cause to producers and to local communities. This study demonstrates the local economic impact of a FMD outbreak in southwest Kansas. The expected economic impact of the disease hinges heavily on where the incidence of the disease occurs. Disease surveillance, management strategies, mitigation investment, and overall diligence clearly need to be much greater in concentrated cattle feeding and processing areas at large feeding operations in the region.

Consumer-level hedonic models are estimated to determine factors affecting retail pork and beef meat cuts. Results indicate that brand premium and discount varies across private, national, and store brands and that brand premium varies across meat cuts carrying the same brand name. Product size discounts are linear for beef and nonlinear for pork, meat items on sale are significantly discounted to nonsale items, specialty stores typically will not garner higher prices than supermarket/grocery stores, and warehouse stores typically have premium prices relative to supermarket/grocery stores.

The first difference version of the restricted source-differentiated almost ideal demand system is used to estimate South Korean meat demand. The results of this study indicate that the United States has the most to gain from an increase in the size of the South Korean imported meat market in terms of its beef exports, while South Korea has the most to gain from this expansion in the pork market. Moreover, the results indicate that the United States has a competitive advantage to Australia in the South Korean beef market. Results of this study have implications for U.S. meat exports in this ever-changing policy environment.

This analysis presents a theoretical model of firm response to border enforcement and evaluates both the intended and unintended effects under two enforcement regimes: destruction versus treatment of contaminated shipments. The results indicate that importers may respond to increased inspection by reducing shipments and decreasing due care. In response to increased pest populations, firms may reduce shipments and increase due care, indicating that an enforcement response may not be necessary. The analysis reveals the importance of the nature of the due-care technology, as well as the relationships underlying the probability of detection, in determining the effects of enforcement.

Using a model of farm household resource allocation and data from the USDA-ERS Agricultural Resource Management Survey (ARMS), this study compares the effects of various categories of farm program payments on time allocation by farm operators and spouses. Results suggest that agricultural market transition payments (AMTA) increase leisure hours of both farm operators and spouses. Loan deficiency payments (LDP) and payments that combine market loan assistance (MLA) and disaster payments are shown to reduce leisure. The study also finds that AMTA payments exhibit a much higher degree of income transfer efficiency than the LDP and MLA payments.

This article looks at technology adoption in agriculture that is specifically targeted against invasive species. The analysis involves predicting the long-term distribution of technology choices when technology can be adopted and disadopted based on current and expected agricultural profits influenced by pest infestation. The theoretical analysis is based on an extension of two authors' findings in 1993 and incorporates the possibility that psychological factors, such as complacency, have a significant impact on technology adoption and hence disease establishment. An empirical application is performed for soybean rust.

This research evaluates whether the introduction of countercyclical payments creates an incentive for program crop producers to hedge the expected government payment using futures and/or options. Results indicate that some level of countercyclical payment hedging is optimal for risk-averse decision makers. However, optimal hedge ratios depend on planting time expectations of marketing year average price as well as on what crop, if any, has been planted on countercyclical payment base acres. These results suggest that the ability to hedge may make these payments more decoupled but also illustrate the distortion of producer behavior induced by farm programs.

Many consumers are concerned with animal welfare in the conventional production of farm livestock. This concern can be related both to their own and others' consumption. In the latter case, there is a negative externality from consumption. We suggest a survey design that enables us to test for a market failure in farm livestock production. Applying this to the question of battery cages in egg production, we cannot show that a market failure exists. The policy can be extended to a general discussion of how potential market failures for all kind of farm livestock should be managed.