We consider private provision of an environmental public good and the link between voluntary pollution-abatement markets and the optimal level of mandatory environmental regulation. We show that voluntary abatement markets react to the level of mandatory abatement imposed and that an optimal regulatory policy must account for that reaction. We consider several assumptions about consumer behavior and find that the voluntary market's reaction to regulation depends on the motivating behavior of consumers. Whether the optimal level of mandatory abatement is higher than the level provided by traditional settings depends on the direction and magnitude of the voluntary market's reaction to changes in mandatory abatement.

Common marketing strategies include emphasizing products’ “green” or environmentally friendly attributes and characteristics to appeal to a growing market of environmentally conscious consumers. While previous studies have used product labels such as “eco-friendly,” “environmentally friendly,” and “sustainable” to investigate consumer preferences, relatively little is known about how consumer perceptions as a pre-decision mechanism impact their preferences and choice behaviors. Using data collected through an online survey of U.S. and Canadian consumers, we investigate systematic differences in individuals’ perceptions of the terms “eco-friendly” and “sustainable.” Marketing implications for the food and green (i.e., greenhouse/nursery producers, suppliers, and retailers) industries are discussed.

This research uses data from the 2005–2011 Agricultural Resource Management Survey and a two-part-model regression procedure to examine the impact of health insurance and other relevant socioeconomic factors on the distribution of health care expenditures among U.S. farm households. Findings show the importance of privately acquired health insurance coverage in explaining inequality in health care expenditures. The results also reveal, among other things, a statistical positive association between health care expenditures and farm operators who fall into the baby boomer age category. A similar statistical association is found for higher income levels but not for inequality of income.

In Finland, expanding dairy farms often face the problem of additional fields being geographically distant and only available as small parcels. We develop a stochastic production frontier model to estimate the technical efficiency of Finnish dairy farms and simulate the effect of parcel distance and parcel size on the efficiency of an average farm for 2000 through 2009. The overall development of technical efficiency is positive during the study period but increases in distance and decreases in parcel size both significantly reduce farm efficiency. Therefore, efforts to improve the parcel structure are justified.

The 1996 Safe Drinking Water Act Amendments required that water utilities send quality reports to customers. We test whether receiving such reports of health violations increases purchases of bottled water using newly released data and disaggregate changes in demand at the intensive and extensive margins. We find that a water-quality violation makes American households 25 percent more likely to purchase bottled water and, among purchasers, expenditures increase 4–7 percent, both larger responses than found in previous studies. Consumers spend approximately $300 million per year—about 4 percent of annual national spending on bottled water—to avoid health risks associated with violations.

A sample selection system is used to examine factors associated with likelihoods of purchase and amounts spent on fresh, frozen, and processed meats in Malaysia based on data from the 2009/10 Malaysian Household Expenditure Survey. Statistical tests support use of the sample selection system estimator over more conventional estimation procedures. Results indicate that household size, location of residence, ethnicity, age, education, and income are closely associated with patterns of household expenditures for fresh, frozen, and processed meats. Several observations are noted regarding determinants of purchase likelihoods and expenditure patterns for meat in Malaysia.

“Buying local״ has become one of the most important trends in food marketing. Despite widespread public attention, the influence of the “local״ attribute on food prices is not well understood. We aim to begin to fill this gap in research by exploring the presence of a price premium for “local״ in actual market transactions. Using scanner data on fresh packaged lettuce in the Honolulu market and hedonic modeling, we investigate consumers’ revealed preferences for the attribute. Contrary to the positive willingness to pay for local food widely reported in previous studies, we find no local premium for fresh lettuce in the Honolulu market.

This study examines in an empirical comparison how different econometric specifications of stochastic frontier models affect the decomposition of total factor productivity growth. We estimate nine stochastic frontier models, which have been widely used in empirical investigations of sources of productivity growth. Our results show that the relative contribution of components to total factor productivity growth is quite sensitive to the choice of econometric model, which points to the need to select the “right” model. We apply various statistical tests to narrow the range of applicable models and identify additional criteria upon which to base the choice of non-nested models.