Title: Examination of the consumers’ ethnocentrism and products’ origin in the case of Hungarian foodstuffs

Authors: Hamori, Judit; Horvath, Agnes; Lehota, Jozsef

Abstract: ‘Consumer ethnocentrism’ is defi ned as consumers’ beliefs about the appropriateness or morality of purchasing domestic and foreign-made products. As a consequence of the infl ux of foodstuffs of dubious origin into Hungary and the increasing number of food scandals, demand for Hungarian foodstuffs of reliable origin has increased. Consumers, however, do not necessarily acquire information from the most reliable sources in the course of purchasing and most of them are not fully aware of what the trademarks featured on the various products mean. Our questionnaire survey sought answers to the questions of how respondents regard Hungarian products and what segments can be distinguished from the aspect of their attitudes concerning Hungarian products. We distinguished four consumer groups – with the aid of cluster analysis – in terms of the factors affecting their choices between Hungarian and imported products when buying foodstuffs, and in terms of their overall attitudes to Hungarian products which appears also in the knowledge of origin labelling.

Title: Using the market opportunities in the food economy’s foreign trade – measurement of success based on the potential balance

Authors: Wagner, Hartmut

Abstract: This work was aimed at analysing the effects of the sudden food price explosion followed by price crash which occurred recently on the foreign trade of the food economy. Comparison of the balances of the different countries was diffi cult due to the differences in the absolute dimensions; therefore a new method was introduced. Firstly, with the help of the “food economic foreign trade profi le” extent to which the different product categories (divided by main product groups or by degree of processing) contribute to the foreign trade balance of the given country’s food economy was examined. In the second step, with the help of “profi le indexing”, the extent to which the country in question was able to turn to profi t the market opportunities offered by the price boom was demonstrated numerically. It can be stated that the foreign trade of the Hungarian food economy is amongst the winners of the price explosion. The balance improved remarkably between the two periods because exports of cereals and oilseeds increased greatly due to the increasing market prices during 2007 and 2008. As regards the performance of the other sectors, Hungary can be however ranked among the losers as a consequence of the decreasing international competitiveness of the production. The assessment has also demonstrated that some of Hungary’s direct competitors (e.g. the Netherlands and Germany) were able to make better use of the opportunities.

Title: Impacts of the Economic Reform Program on the Performance of the Egyptian Agricultural Sector

Authors: Soliman, Ibrahim; Fabiosa, Jacinto F.; Gaber Amer, Mohamed; Kandil, Siham

Abstract: From 1986 to 2007 Egypt’s agricultural policy transitioned from a tightly controlled to a more liberalized regime. This study examines the impact of this change on the performance of the wheat (imported grain) and rice (exported grain) sectors. In terms of profitability, we found that the cost of production increased substantially in both grains, driven primarily by the rise in land rent and labor wage. But the wheat and rice sectors’ profitability did not suffer significantly, as advances in new seed technologies and adoption of better farm practices including farm mechanization increased yield and compensated for the higher cost. Considering market efficiency, we found that over the study period the farmer’s share of the consumer’s expenditure dropped from 51% to 37% in the case of wheat, while it increased from 24% to 26% in the case of rice. The reverse happened for wholesale and retail margin share, where it increased for wheat and decreased for rice. It is likely that the discipline from foreign suppliers of imported wheat and foreign market opportunities for exported rice may explain the difference in the changes of the distribution of consumer expenditure. Finally, we found that area response elasticity decreased over time from 0.58 to 0.12 for rice and 0.60 to 0.38 for wheat. The lack of response in rice area despite rising prices is attributed to the land limit strictly imposed by the Government of Egypt because of water supply constraint considerations. On the other hand, the lack of response in wheat area despite rising wheat prices may be attributed to the rising competitiveness of Egyptian clover, which is a main feed ingredient for the growing livestock sector.

Title: Optimization of land and resource use at farm-aggregated level in the Aral Sea Basin of Uzbekistan with the integrated model FLEOM – model description and first application

Authors: Sommer, Rolf; Djanibekov, Nodir; Salaev, Omonbek

Abstract: Land use and crop production in the Khorezm region in western Uzbekistan, exemplarily for the irrigated low-lands of Central Asia, is adversely affected by the excessive, non-sustainable use of irrigation water on one hand, repeated droughts on the other hand, and by soil degradation by secondary salinization. One of the research objectives of the German-Uzbek Khorezm project, funded by the German Ministry for Education and Research (BMBF) and led by ZEF, is to better understand options for land use and choice of technology at the farm level in order to evaluate and propose technological alternatives and policy options for sustainable land use in Khorezm. To address the latter, the integrated so-called Farm-Level Economic-Ecological Optimization Model (FLEOM) was developed. FLEOM optimizes farm-level land and resource use while at the same time assessing the respective economic and environmental impacts. The model captures the basic features of the regional agriculture and the interrelations of production activities most prevalent to the local farmers. FLEOM builds on an economic farm-household linear-programming (LP) optimization routine and a comprehensive agronomic data base established with the cropping system simulation model, CropSyst. A graphical user-interface programmed in Java provides for easy usability, by which settings and results of FLEOM are visualized in tables and figures or as maps via a GIS-environment. The present discussion paper provides a technical introduction to FLEOM and discusses first application results.

Title: Costs and Benefits to Taxpayers, Consumers, and Producers from U.S. Ethanol Policies

Authors: Babcock, Bruce A.; Barr, Kanlaya; Carriquiry, Miguel

Abstract: The U.S. ethanol industry is lobbying hard for an extension of existing ethanol import tariffs and blenders tax credits before they expire at the end of 2010. The purpose of this study is to examine the likely consequences on the U.S. ethanol industry, corn producers, taxpayers, fuel blenders, and fuel consumers if current policy is not extended. Impacts of different ethanol policies in both 2011 and 2014 were estimated. Estimates were obtained by developing a new stochastic model that calculates market-clearing prices for U.S. ethanol, Brazilian ethanol, and U.S. corn. The model is stochastic because market-clearing prices are calculated for 5,000 random draws of corn yields and wholesale gasoline prices. Key assumptions in this study are that the strong growth in flex-fuel vehicles in Brazil continues; intermediate ethanol blends with few restrictions are implemented in U.S. markets in 2014; U.S. ethanol production capacity reaches 15 billion gallons in 2014; and Brazilian ethanol production increases by at least 45% by 2014. Projected strong demand for ethanol in Brazil combined with a largely saturated U.S. ethanol market means that elimination of ethanol import tariffs would have almost no impact on U.S. corn and ethanol markets in 2011. Elimination of the tax credit would impact markets modestly, with ethanol production declining by an average of about 700 million gallons. This reduction in ethanol production would cause corn prices to drop by an average of 23 cents per bushel. Ethanol prices would drop by 12 cents per gallon. Elimination of the tax credit would shift the burden of meeting mandates from taxpayers to blenders and consumers. Taxpayers would save more than $6 billion through elimination of the tax credit, or almost $7.00 per gallon of ethanol produced in excess of mandated amounts. The impacts of a change in U.S. ethanol policy in 2014 are larger than 2011 impacts because Brazil has a chance to respond by ramping up its ability to export in response to trade liberalization. But because of strong domestic demand growth in Brazil and limits on how fast Brazilian ethanol production can increase, the impacts of a change in policy are still modest. As long as the mandate is maintained, U.S. ethanol production drops by no more than 500 million gallons, corn prices drop by no more than 16 cents per bushel, and ethanol prices drop by no more than 35 cents per gallon. If the impact of intermediate blends is not as strong as assumed in this study, then there will be less incentive for Brazil to export ethanol and the impacts of tariff elimination would be even more modest.

Title: Riceflow: a Multi-region, Multi-product, Spatial Partial Equilibrium Model of the World Rice Economy

Authors: Durand-Morat, Alvaro; Wailes, Eric

Title: 2010 Outlook for the U.S. and World Corn and Soybean Industries, 2009-2019

Authors: Taylor, Richard D.; Koo, Won W.

Abstract: This report evaluates the United States and world corn and soybean markets for the 2009-2019 time period using the Global Corn and Soybean Policy Simulation Model. This analysis is based on a series of assumptions about general economic conditions, agricultural policies, weather conditions, and technological change. The major influence in the corn market will be U.S. corn based ethanol production. If the production of corn based ethanol remains strong, corn prices will likely remain strong. However, if the U.S. Federal government subsidies or mandates change, the world corn market could be negatively impacted. Under the current assumptions in the model, corn price is expected to remain in a range between $3.70 and $4.10 per bushel. The level of Chinese soybean imports is the leading factor in the world soybean market. China currently imports 60% of the available soybeans, and that is expected to increase to about 65% by 2019. Major exporters will continue to be the U.S., Brazil and Argentina. However both Brazil and Argentina should increase exports while U.S. exports will remain at the current level. Soybean prices are expected to fluctuate, but remain in the $9.70 per bushel range throughout the forecast period.

Title: Getting to the Top of Mind: How Reminders Increase Saving

Authors: Karlan, Dean; McConnell, Margaret; Mullainathan, Sendhil; Zinman, Jonathan

Abstract: We develop and test a simple model of limited attention in intertemporal choice. The model posits that individuals fully attend to consumption in all periods but fail to attend to some future lumpy expenditure opportunities. This asymmetry generates some predictions that overlap with models of present-bias. Our model also generates the unique predictions that reminders may increase saving, and that reminders will be more effective when they increase the salience of a specific expenditure. We find support for these predictions in three field experiments that randomly assign reminders to new savings account holders.

Title: Evolving Market Performance in Brazilian Futures Contracts Using Relative Efficiency

Authors: Mattos, Fabio; Garcia, Philip; Urso, Fabiana

Title: Market Integration for Shrimp and the Effect of Catastrophic Events

Authors: Harri, Ardian; Muhammad, Andrew; Jones, Keithly

Abstract: Seasonal unit-root testing and seasonal cointegration methods are employed to investigate the price transmission in U.S. shrimp markets. ARIMA and Vector Error Correction Models (VECM) are used to identify the effect of catastrophic events on individual price series in one region and the spillover effects in the price series for other regions. Results showed that a cointegrating relation exists between neighboring states, specifically between Alabama and Mississippi and Louisiana and Texas. Cointegrating relations also exist between the Gulf States and the Pacific region, but not the Atlantic region, and the price of imported shrimp is cointegrated with each of the domestic shrimp price series. Finally, while Katrina had an effect on shrimp prices in Gulf States, the effect was not long lasting.

Title: Common agency: Conspiracy of conscious parallelism? Indirect evidence from a repeated English auction

Authors: Coatney, Kalyn T.; Shaffer, Sherrill; Menkhaus, Dale J.

Title: The Economics of Nested Insurance: The Case of SURE

Authors: Cooper, Joseph; Sproul, Thomas; Zilberman, David

Abstract: Traditionally, disaster assistance was available on an ad hoc basis, but the 2008 Farm Act provides a standing disaster assistance program known as Supplemental Revenue Assistance (SURE). This paper introduces a theory of nested insurance to evaluate the impact on of SURE on intensification, acreage and adoption. The results suggest that parameters of a government program like SURE may enhance the adoption and value of crop insurance to the farm sector. A quantitative understanding of the interdependencies between programs like SURE and crop insurance, taking into account the nature of the ad hoc alternative, is important in assessing the welfare impacts on farmers, as well as insurance companies. Both our theory and simulation exercise suggest that insurance increases the volume of production and/or leads to increased intensification (substitution into higher value crops). On the other hand, the gains from insurance and from programs like SURE may be lessened by the presence and probability of ad hoc disaster assistance.

Title: State branded programs and consumer preferences for locally grown produce

Authors: Nganje, William; Hughner, Renee; Lee, Nicholas

Title: How China's Palm Oil Imports Impact Its Soybean Oil Imports

Authors: Chen, Wei; Muhammad, Andrew

Title: Vegetable and Melons Outlook: June 24, 2010

Authors: Lucier, Gary; Glaser, Lewrene

Title: Is the Facilitation of Sustainable Market Access Achievable? Design and Implementation Lessons from Armenia

Authors: Gow, Hamish; Shanoyan, Aleksan

Abstract: Over the past three decades the globalization in agri-food sector has been accompanied by a dramatic restructuring, liberalization and privatization of markets often with serious adverse consequences for small farmers in developing and transition countries. Consequently, governments and the international donor community have markedly shifted their development policies from traditional technology transfer approaches towards more market-driven approaches of linking farmers to markets. The international agricultural development literature has begun exploring the appropriate structure of third-party facilitated institutions and enforcement mechanisms to support linking small farmers to markets. Based upon a series of long-term qualitative and quantitative analyses of the instrumental case of USDA Marketing Assistance Project in Armenia, we use a grounded theory approach to develop a dual strategic model for the establishment of sustainable third party facilitated market linkages between producers and processors. Our results and model indicate that if donors pursue a dual strategy of concurrent facilitation of private enforcement on the processing level and institutional arrangement on the producer level in the design and implementation of third-party market linkage programs, they are likely to achieve higher program impact, improved trust among channel participants, and long-run economic sustainability of market linkages.

Title: Experiences with devolution measures as a new form of governance in Albania’s fishery sector

Authors: Schmidt, Oscar; Theesfeld, Insa

Abstract: Local governance based on institutions for collective action can help overcome social dilemmas in natural resource management. However, despite the potential benefits of such current decentralization policies, the phenomenon of elite capture remains a risk. We investigate occurrences and effects of elite capture in Albania’s Lake Ohrid fishing region. Our empirical case shows how ‘blueprint’ approaches, top-down implementation, and weak back-up institutions have led to further empowerment of privileged locals, and how these locals have realized personal gains at the expense of distributional inequity within the community. Patronage and kinship determine the prevailing informal institutions, manifesting this inequity.

Title: Institutional Change and Collective Action: The Case of Reclamation Systems in Northwest Poland

Authors: Schleyer, Christian

Abstract: This paper examines two drastic changes in the performance of local water associations in providing local public goods – appropriate levels of water table – in the reclamation system in the Powiat Pyrzyce in the Voivodship Zachodniopomorski in northwest Poland. Employing an institutional economics approach shows the results of processes of revalorisation of the interrelated property objects land and reclamation infrastructure that have been triggered and shaped not only by the drastic political, economic and administrative changes after the breakdown of the socialist regime in Poland in 1990, but also by the prospect of joining the European Union and the proactive leadership of the director of the Powiat Department of Environmental Protection, Forestry and Agriculture. More precisely, both processes – the discontinuation (from 1990 onwards) and revival (from 2002 onwards) of the local water associations – were mainly determined by changing market conditions together with variances in the ability of state authorities to effectively control and facilitate these associations. Further, the delay in overcoming the period of collective inaction was fostered by the time-delayed and cumulative effects of neglecting the cleaning and the maintenance of secondary ditches.

Title: Changing governance in the EU milk supply chain

Authors: Krol, Noortje; Polman, Nico; Peerlings, Jack; Nikolov, Dimitre

Abstract: With the 2008 EU’s CAP reform the governance of the EU’s dairy sector changes. This paper focuses on governance structures between dairy farms and milk processors. To get insight in regional differences within the EU, a literature research and interviews are conducted in three case study areas, namely: the Netherlands, Bulgaria and France. Results show that in these countries both farmers and processors have incentives to form hybrid governance structures with a higher level of control compared to the current structures. Most dairy cooperatives have no additional advantage in managing milk quality and milk supply compared to investor owned firms. Chain integration could go a step further in Bulgaria compared to the Netherlands and France given the institutional environment that is not expected to guarantee milk quality and the focus on the export of milk.

Title: The Meaning of Tradition in the Modern World: Village Representatives in Poland – Institution in Transition

Authors: Matysiak, Ilona

Abstract: The main aim of this paper is to discuss the current situation of village representatives (soltysi) in Poland in the times of dynamic changes taking place in the Polish countryside in the last decades. The importance of the institution of village representatives manifest itself in two main dimensions. Firstly, it is supported by the power of tradition – village representatives are deeply rooted in the historical evolution of rural self-government in Poland. Secondly, this institution is a part of the current system of local democracy. Secondly, this institution is a part of the current system of local democracy. Due to the pressure to implement the bottom-up models of governance, the full potential of this institution should be realized and discussed. This discussion is based on the small-scale quantitative data from the surveys conducted among the village representatives and also the inhabitants, which gives the opportunity to confront both perspectives. It occurs, that, in the changing reality, the institution of village representative should be supported with more than just the forces of tradition.