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| Registros recuperados: 23 | |
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| Wu, Steven Y.; Roe, Brian E.. |
| The form and regulation of contracts is of increasing importance to agricultural economists as farmers and agribusinesses increasing rely on contracts rather than markets to acquire inputs and sell outputs. We focus on the differences between the joint and individual surplus achievable under complete versus incomplete or relational contracts, where the latter are contracts that are not verifiable by a third party and must rely upon threat of termination in order to entice mutually satisfactory performance. Using an experimental market similar to Brown, Falk, and Fehr [Brown, M., A. Falk, and E. Fehr. Relational Contracts and the Nature of Market Interactions, Econometrica, 72 (2004):747-780] we replicate the general results found by these authors,... |
| Tipo: Conference Paper or Presentation |
Palavras-chave: Marketing. |
| Ano: 2005 |
URL: http://purl.umn.edu/19215 |
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| Lee, Myoungki; Wu, Steven Y.. |
| We study the economic impact of proposed legislation requiring processors to pay termination damages to growers when contractual relationships are prematurely severed. In doing so, we derive the optimal relational contract in the presence of asset specificity, ex post market power on the part of processors, and the presence of an exogenous shock that might destroy gains from trade from contracting. The optimal contract then provides a credible framework for assessing how government intervention might affect optimizing behavior of contracting parties. We conclude that termination damages would not be distortionary and would not undermine processors' ability to design effective relational incentives. However, the distribution of surplus would be affected. |
| Tipo: Conference Paper or Presentation |
Palavras-chave: Agricultural and Food Policy. |
| Ano: 2005 |
URL: http://purl.umn.edu/19184 |
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| LaFrance, Jeffrey T.; Shimshack, Jay P.; Wu, Steven Y.. |
| A partial equilibrium model of stochastic crop production is used to analyze the environmental impacts of popular subsidized crop insurance programs. Land use is unchanged only when an actuarially fair, perfectly separating insurance contract is offered. For the more typical pooling equilibrium contracts, however, land with a minimum quality that is strictly lower than the minimum quality without insurance will be added to production. In such cases, the environment will be adversely effected. If economically marginal land is also environmentally marginal, pooling crop insurance policies disproportionately contribute to the degradation of the environment. Popular subsidies merely exacerbate the problem. |
| Tipo: Working or Discussion Paper |
Palavras-chave: Environmental Economics and Policy; Risk and Uncertainty. |
| Ano: 2001 |
URL: http://purl.umn.edu/25082 |
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| Wu, Steven Y.; Roe, Brian E.. |
| Using experimental economics, we compare the efficiency and welfare effects of tournament and fixed standards contracts. Our findings suggest that economic agents are generally better off under fixed standard contracts unless they face substantial common shocks. Administrators of contracts (principals) also tend to be better off under fixed standard contracts for moderate to small common shocks. Efficiency wise, agents tend to exert higher effort under fixed standard contracts. Moreover, effort under tournaments appears to be declining in the variance of the common shock. Our results suggest that a ban on tournament contracts may generally be better off for both growers and processors except in cases where common shocks are large. |
| Tipo: Conference Paper or Presentation |
Palavras-chave: Agribusiness. |
| Ano: 2003 |
URL: http://purl.umn.edu/21938 |
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| Cakir, Metin; Balagtas, Joseph Valdes; Wu, Steven Y.. |
| The objective of this paper is to develop a model that explains the involvement of first level handlers in farm level decisions. In particular, the research attempts to explain observed differences among levels of farmer's autonomy in production contracts of different agricultural commodities. We show that the trade off that a contractor faces for holding the decision rights for controlling production inputs varies for different production environments. In particular, the contractor prefers controlling inputs in production of commodities that have relatively uniform production environments, whereas it is more efficient to delegate the control to the producer for commodities that have diverse production environments. |
| Tipo: Conference Paper or Presentation |
Palavras-chave: Agribusiness. |
| Ano: 2009 |
URL: http://purl.umn.edu/49577 |
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| Wu, Steven Y.; Nazaryan, Natalie; Roe, Brian E.; Sporleder, Thomas L.. |
| Experimental economics is used to compare tournaments (T) and fixed performance contracts (F) when agents have heterogeneous costs. Our primary findings were: (1) There is no statistical difference in average pooled effort (effort by high ability and low ability subjects are pooled together to get an aggregate average) under T and F contracts, (2) on average, effort exerted by high ability agents is considerably higher than effort exerted by low ability agents under both types of contracts, (3) average pooled payoff for the subjects is affected by the type of contract used. Statistical analysis of the results revealed that high ability subjects generally benefit from tournaments whereas low ability agents are harmed by tournaments. Only in the case... |
| Tipo: Conference Paper or Presentation |
Palavras-chave: Research Methods/ Statistical Methods. |
| Ano: 2004 |
URL: http://purl.umn.edu/20103 |
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| Brady, Michael P.; Roe, Brian E.; Wu, Steven Y.. |
| Greater attention has been paid to understanding differences between individual and group decision-making in economics in recent years. While great strides have been made in understanding the relative cognitive ability of each, differences in preferences are less well understood. This study examined preferences for risk individually and in groups of two. Results show that a majority of groups act according to the preferences of one of the two pair members. This is not a result emphasized in previous social psychology research on groups. Thus, we propose a new explanation of group decision making based on strength of preference. |
| Tipo: Conference Paper or Presentation |
Palavras-chave: Risk and Uncertainty. |
| Ano: 2006 |
URL: http://purl.umn.edu/21056 |
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| Just, David R.; Wu, Steven Y.. |
| Loss aversion has become the dominant alternative to expected utility theory for modeling choice under uncertainty. The setting of the base payment in contracts provides an interesting application of referenced based decision theory. The impact of loss aversion on contract structure depends critically on whether reservation opportunities (outside options) are evaluated with respect to the reference point implied in the contract. We show that when reservation opportunities are independent of the reference point, reward contracts are optimal. However, when reservation opportunities are evaluated against the reference point, then penalty contracts are more efficient. |
| Tipo: Conference Paper or Presentation |
Palavras-chave: Risk and Uncertainty; L14; D81; D21; D82. |
| Ano: 2005 |
URL: http://purl.umn.edu/28727 |
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| Roe, Brian E.; Wu, Steven Y.. |
| We consider the implications of banning tournament contracts and replacing them with fixed performance standard contracts in a multi-period model where the principal cannot commit to future contract parameters. A ban cannot increase total surplus in a static model. In a dynamic model, however, a ban of tournaments can increase total surplus by mitigating the ratchet effect. Calibrating our model to published data from the broiler sector, we find that a ban on use of contemporaneous and lagged relative performance data does not improve total surplus under most circumstances but could increase total surplus in a few instances of low wealth and unitary relative risk aversion. A more enforceable, period-by-period ban is even less likely to be welfare... |
| Tipo: Conference Paper or Presentation |
Palavras-chave: Livestock Production/Industries. |
| Ano: 2003 |
URL: http://purl.umn.edu/22151 |
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| Wu, Steven Y.; Roe, Brian E.; Sporleder, Thomas L.; Nazaryan, Natalie. |
| Experimental economics is used to compare tournaments (T) and fixed performance contracts (F) when agents have heterogeneous costs. Results suggest that: (1) There is no difference in average pooled effort across contracts, (2) high ability agents exert higher effort than low ability agents under both types of contracts, (3) average pooled earnings are affected by contract type, (4) high ability agents benefit from T whereas low ability agents are harmed by T, and (5) the difference in average pay between high and low ability agents is larger under T. Thus, T implement greater inequality. |
| Tipo: Working or Discussion Paper |
Palavras-chave: Research Methods/ Statistical Methods. |
| Ano: 2005 |
URL: http://purl.umn.edu/28318 |
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| Wu, Steven Y.; Roe, Brian E.. |
| This paper reports the results of an economic experiment investigating human subjects' preferences for two types of contracts tournaments and fixed performance standard contracts. Willingness to pay data was elicited through an auction and results suggest that subjects prefer fixed performance standard contracts to tournaments. Primary drivers of this result appear to be subjects' perceptions that tournaments are more risky and less fair than fixed performance standard contracts. Surprisingly, measures of the relative profitability of the contracts did not correlate with willingness to pay. Our results can shed light on why agricultural producers express frustration over tournaments and can provide insights on contract and policy design. |
| Tipo: Conference Paper or Presentation |
Palavras-chave: Research Methods/ Statistical Methods. |
| Ano: 2004 |
URL: http://purl.umn.edu/20154 |
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| LaFrance, Jeffrey T.; Shimshack, Jason; Wu, Steven Y.. |
| A partial equilibrium model of stochastic crop production is used to analyze the influence of subsidized crop insurance on the extensive margin. The addition of a crop insurance program that is characterized by a perfectly separating equilibrium and an actuarially fair premium for each quality does not change input use or land allocation. However, Risk neutral farmers facing actuarially fair premiums are indifferent between the purchase and not purchase decision. risk averse farmers all will purchase actuarially fair crop insurance. Premium subsidies create incentives for the extensive margin to expand at the lower end of the quality spectrum leading to adverse selection. Land in production without crop insurance remains in production with subsidized crop... |
| Tipo: Working or Discussion Paper |
Palavras-chave: Crop Production/Industries; Risk and Uncertainty. |
| Ano: 2000 |
URL: http://purl.umn.edu/25018 |
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| Registros recuperados: 23 | |
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