SABIIA - Sistema Aberto e Integrado de Informação em Agricultura (Sabiia)

Chen, Yu-Fu; Funke, Michael.

The standard literature on working time has modelled the decisions of firms in a deterministic framework in which firms can choose between employment and overtime (given mandated standard hours). Contrary to this approach, we follow the real options approach, which allows us to investigate the value to a firm of waiting to adjust labour when the firm´s revenues in domestic currency are stochastic and adjustment costs are sunk. The simulations reject the null hypothesis that all exchange rate regimes obey common employment adjustment thresholds.

Securing the Border from Invasives: Robust Inspections Under Severe Uncertainty

Palavras-chave: Real Option Theory; Uncertainty; Working Time; Employment; Labour Demand; Exchange Rates; Financial Economics; Labor and Human Capital; D81; E24; J23; F31.

Ano: 2002

URL: http://purl.umn.edu/26287

Moffitt, L. Joe; Stranlund, John K.; Osteen, Craig D..

Two important features of agricultural quarantine inspections of shipping containers for invasive species at U.S. ports of entry are the general absence of economic considerations and the severe uncertainty that surrounds invasive species introductions. In this article, we propose and illustrate a method for determining an inspection monitoring protocol that addresses both issues. An inspection monitoring protocol is developed that is robust in maximizing the set of uncertain outcomes over which an economic performance criterion is achieved. The framework is applied to derive an alternative to Agricultural Quarantine Inspection (AQI) for shipments of fruits and vegetables as currently practiced at ports of entry in the United States.

Household perceptions of climate change and preferences for mitigation action: the case of the Carbon Pollution Reduction Scheme in Australia

Palavras-chave: Inspection; Invasive Species; Uncertainty; Agricultural and Food Policy; Food Consumption/Nutrition/Food Safety; Public Economics; Risk and Uncertainty; Q18; Q57; D81.

Ano: 2009

URL: http://purl.umn.edu/53127

Akter, Sonia; Bennett, Jeffrey W..

The study aims to reveal Australian households’ perceptions of climate change and their preferences for climate change mitigation actions. A web-based survey was conducted in November 2008 in which about 600 New South Wales households were asked for their willingness to bear extra household expenditure to support the ‘Carbon Pollution Reduction Scheme (CPRS)’ as proposed by the Australian government. The Contingent Valuation Method (CVM), a widely used non-market valuation technique, was applied using the single bounded dichotomous choice elicitation format. Results of the study demonstrate that, currently, there is a positive demand for climate change mitigation action in Australia. The main motivation for this positive demand stems from a desire to avoid...

Use of strategies and decision rules by Australian wool producers to manage uncertainty

Palavras-chave: Contingent valuation; Climate change; Carbon Pollution Reduction Scheme; Willingness to pay; Uncertainty; Australia.

Ano: 2009

URL: http://purl.umn.edu/47936

Murray-Prior, Roy B.; Wright, Vic.

Decisions by Australian wool producers were modelled with a technique combining personal construct psychology and hierarchical decision models. Both strategic and tactical approaches were evident in wool producers’ responses to the risks associated with producing and marketing their wool. Strategic responses included avoiding short to medium-term response to price changes, diversification, maintaining equity and selling wool at auction in the same sale each year. Producers identified many types of risk, with each engendering a distinctive response. Similarly the context of a decision appeared to have a major influence on the attitude to risk. Simplifying decision rules were apparent that helped producers deal with the physical, information, and processing...

Tipo: Article

Palavras-chave: Hierarchical decision models; Risk; Uncertainty; Ambiguity; Strategy; Wool; Farm Management.

Ano: 2004

URL: http://purl.umn.edu/120919

Carbon Sequestration in Agricultural Soils: Discounting for Uncertainty

Kurkalova, Lyubov A..

The study presents a conceptual model of an aggregator who selectively pays farmers for altering farming practices in exchange for carbon offsets that the change in practices generates. Under the assumption that the offsets are stochastic and that the aggregator maximizes the sum of the offsets from the purchase that he/she can rightfully claim with a specified level of confidence subject to a budget constraint, we investigate the optimal discounting of expected carbon offsets. We use the model to estimate empirically the optimal discounting levels and costs for a hypothetical carbon purchasing project in the Upper Iowa River Basin.

Second-Order Ambiguity in Very Low Probability Risks: Food Safety Valuation

Palavras-chave: Carbon sequestration in agricultural soils; Offset discounting; Uncertainty; Environmental Economics and Policy.

Ano: 2005

URL: http://purl.umn.edu/18551

Kivi, Paul A.; Shogren, Jason F..

Food consumption involves inherently risky decisions with uncertain probabilities. This study examines how second-order ambiguity, or uncertainty over probabilities, affects food safety decisions. We conduct a food safety survey wherein subjects face both unambiguous and ambiguous situations, each with the same expected value. Respondents show a preference for unambiguous situations and state a willingness to pay to avoid ambiguity

Tipo: Journal Article

Palavras-chave: Ambiguity; Ambiguity avoidance; Expected utility theory; Food safety; Low probability events; Risk; Second-order probabilities; Uncertainty; Risk and Uncertainty.

Ano: 2010

URL: http://purl.umn.edu/97857

Real option models for simulating digester system adoption on livestock farms in Emilia-Romagna

Bartolini, Fabio; Gallerani, Vittorio; Viaggi, Davide.

Innovation and new technology adoption represent two central elements for the enterprise and industry development process in agriculture. The objective of this paper is to develop a farm-household model able to simulate the impacts of uncertainty in SFP, the selling price of energy and agricultural product prices parameters on the adoption of methane digester for biogas production. The model implemented is based on a real option approach that includes investment irreversibility and stochasticity in relevant parameters. The results show the relevance of uncertainty in determining the timing of adoption and emphasise the importance of predictability as a major component of policy design.

The Impact of the E.coli Spinach Outbreak on Acreage Decisions Under Uncertainty

Palavras-chave: Real options; Methane digester; Biogas; Investment; Uncertainty; Agricultural and Food Policy; Farm Management; Land Economics/Use.

Ano: 2010

URL: http://purl.umn.edu/61112

Mohr, Belinda Acuna.

This article quantifies the effect of the 2006 food-borne illness spinach outbreak on harvested acreage for the fresh spinach market. In September 2006, fresh spinach contaminated with E. coli O157:H7 caused hundreds of consumer illnesses across the U.S. and a few deaths. The outbreak was detrimental to the spinach industry causing a significant decrease in the demand for spinach. Spinach growers were prohibited from harvesting spinach until more was known about the contamination. According to the Census of Agriculture, harvested spinach acreage for the fresh market fell by 17% from before the outbreak. Due to the unanticipated effects resulting from the outbreak, farms potentially decreased their acreage of fresh market spinach to reduce profit...

Uncertainty Discounting for Land-Based Carbon Sequestration

Palavras-chave: Production; Acreage; Uncertainty; Spinach outbreak; Food safety; Agricultural and Food Policy; Crop Production/Industries; Food Consumption/Nutrition/Food Safety; Risk and Uncertainty; Q11; Q18.

Ano: 2011

URL: http://purl.umn.edu/103520

Kim, Man-Keun; McCarl, Bruce A..

The effect of stochastic factors on soil carbon makes the quantity of carbon generated under a sequestration project uncertain. Hence, the quantity of sequestered carbon may need to be discounted to avoid liability from shortfalls. We present a potentially applicable uncertainty discount and discuss difficulties that might arise in empirical use. We insist that the variance in historical crop yields across geographical areas is used to derive a proxy variance for forming an uncertainty discount for carbon projects. Application of our approach suggests that project level uncertainty discounts would be 15–20% for the East Texas region.

Tipo: Journal Article

Palavras-chave: Carbon sequestration; Discount; Uncertainty; Agribusiness; Land Economics/Use; Research and Development/Tech Change/Emerging Technologies; H43; Q54.

Ano: 2009

URL: http://purl.umn.edu/48754

Regulating Stock Externalities Under Uncertainty

Newell, Richard G.; Pizer, William A..

Using a simple analytical model incorporating benefits of a stock, costs of adjusting the stock, and uncertainty in costs, we uncover several important principles governing the choice of price-based policies (e.g., taxes) relative to quantity-based policies (e.g., tradable permits) for controlling stock externalities. Applied to the problem of greenhouse gases and climate change, we find that a price-based instrument generates several times the expected net benefits of a quantity instrument. As in Weitzman (1974), the relative slopes of the marginal benefits and costs of controlling the externality continue to be critical determinants of the efficiency of prices relative to quantities, with flatter marginal benefits and steeper marginal costs favoring...

Marine Reserves Switching under Uncertainty

Palavras-chave: Stock; Externality; Regulation; Policy; Uncertainty; Price; Quantity; Tax; Tradable permit; Pollution; Climate change; Greenhouse Gas; Instrument choice; Risk and Uncertainty; Q28; D81; C61.

Ano: 2000

URL: http://purl.umn.edu/10471

Yamazaki, Satoshi.

This paper analyses a fisheries management strategy, marine reserves switching, in which a non-fishing area is created, removed, or rotated from one site to another according to economic criteria through time. Using a dynamic optimisation framework under uncertainty, with the different fish dispersal processes, the optimal switching strategy and density distributions of the biomass, harvest, and net profit are simulated and compared under different management scenarios. This study will provide a decision and modelling framework for the design of marine reserves to achieve desired management goals.

Are Homeowners Willing to Pay for "Origin-Certified" Plants in Water-Conserving Residential Landscaping?

Palavras-chave: Bioeconomic model; Fisheries management; Marine reserves; Uncertainty; Resource /Energy Economics and Policy; Risk and Uncertainty; Q22.

Ano: 2008

URL: http://purl.umn.edu/6003

Curtis, Kynda R.; Cowee, Margaret W..

This study investigates the value of local origin-labeling for a nonfood product by evaluating Nevada homeowner purchase propensity for “NevadaGrown” native plants for water-conserving residential landscaping. Homeowner survey results illustrate that homeowners may be willing to pay as much as a 14% premium for origin-certified native plants. WTP estimates are higher when uncertain responses are incorporated into the bidding structure. Preferences for local production and drought resistance in plants are the primary drivers of purchasing decisions in the absence of uncertain responses, while income levels and preferences for natural plant appearance additionally affect purchasing decisions when uncertainty is incorporated.

Tipo: Journal Article

Palavras-chave: Drought resistance; Native plants; Origin labeling; Uncertainty; Willingness to pay; Resource /Energy Economics and Policy.

Ano: 2010

URL: http://purl.umn.edu/61066

Permanence of Carbon Sequestered in Forests under Uncertainty

Kim, C.S.; Lewandrowski, Jan; Sands, Ronald D.; Johansson, Robert C..

In this paper we examine the issue of permanence in the context of sequestering carbon through afforestation. We develop a dynamic nested optimal control model of carbon sequestration associated with the decision to afforest a tract of land given there are uncertainties associated with fire and insect/disease hazards. Conceptually, these potential hazards are similar in that their occurrence at any time t is uncertain and landowners can take specific actions – although generally different actions - in any time period t to reduce the probability of sustaining losses related to them. The hazards differ, however, in that fire represents a large loss in carbon at a moment in time, while insect/disease infestations are more likely to be reflected in a period...

The Demand for Specialty-Crop Insurance: Adverse Selection and Inefficiency

Palavras-chave: Carbon sequestration; Uncertainty; Optimal control; Hazard function; Forestry; Permanence; Environmental Economics and Policy; Land Economics/Use.

Ano: 2011

URL: http://purl.umn.edu/103565

Richards, Timothy J.; Mischen, Pamela.

The twin problems of moral hazard and adverse selection are often blamed for the lack of insurance for many fruits and vegetables. This paper develops an alternative method of testing for adverse selection that uses a two-stage approach to determine the effects of technical inefficiency on the demand for insurance. With this approach, technical inefficiency is interpreted as an indicator of adverse selection. Because there is no active insurance market for many specialty crops, and thin markets for those that are insurable, a contingent valuation approach is used to obtain the data necessary to estimate the demand for three different types of insurance. The results suggest adverse selection may be a deterrent to the viability of extending the breadth of...

Tipo: Journal Article

Palavras-chave: Contingent valuation; Crop insurance; Fruits and vegetables; Moral hazard; Risk; Uncertainty; Agribusiness; Financial Economics; Risk and Uncertainty.

Ano: 1998

URL: http://purl.umn.edu/90435

Die Berücksichtigung von Unsicherheit und Flexibilität in der Investitionsplanung – dargestellt am Beispiel einer Vertragsinvestition für Roggen

Musshoff, Oliver; Hirschauer, Norbert.

Investment decisions are, as a rule, characterized by uncertainty, irreversibility and flexibility. Simple net present value calculations will not account for these features. In many situations even flexible investment planning with decision trees, which represents the most advanced method of traditional investment appraisal, does not have the capacity to solve practical decision problems adequately. One handicap is a realistic and manageable representation of stochastic variables. It has long been known that stochastic simulation procedures offer a nearly unlimited capacity to represent distributions and stochastic processes. However, a standard simulation will not allow for the consideration of flexibility. The problem is that with a simple forward...

Tipo: Journal Article

Palavras-chave: Investment; Uncertainty; Flexibility; Stochastic simulation; Dynamic programming; Sales contracts with fixed prices; Farm Management; Research Methods/ Statistical Methods; Risk and Uncertainty.

Ano: 2004

URL: http://purl.umn.edu/97437

The Convergence of International Interest Rates Prior to Monetary Union

Wilfling, Bernd.

The process of international interest rate convergence for arbitrary terms (represented by the term structure of interest rate differentials) is derived in a model of a small open economy which faces a purely time-contingent exchange rate regime switch from flexible to fixed rates. Special attention is paid to a situation in which financial markets deem a delay in the regime switch beyond the publicly announced fixing date possible. The closed-form solution of the term structure allows us to analyze the volatility of interest rate differentials thus providing a useful tool for interest-rate-sensitive security valuation and other risk management applications. Furthermore, the model demonstrates that the economy under consideration has to pay for the...

The Social Discount Rate under Intertemporal Risk Aversion and Ambiguity

Palavras-chave: Exchange rate regime switches; Interest rates; Term structure; Stochastic processes; Uncertainty; Financial Economics; E43; F31; F33.

Ano: 2001

URL: http://purl.umn.edu/26165

Traeger, Christian P..

The social discount rate crucially determines optimal mitigation policies. This paper examines two shortcomings of the recent debate and the models on climate change assessment. First, removing an implicit assumption of (intertemporal) risk neutrality reduces the growth effect in social discounting and significantly amplifies the importance of risk and correlation. Second, debate and models largely overlook the difference in attitude with respect to risk and with respect to non-risk uncertainty. The paper derives the resulting changes of the risk-free and the stochastic social discount rate and points out the importance of even thin tailed uncertainty for climate change evaluation.

Modelling Negotiated Decision Making: a Multilateral, Multiple Issues, Non-Cooperative Bargaining Model with Uncertainty

Palavras-chave: Ambiguity; Discounting; Expected utility; Intertemporal substitutability; Intertemporal risk aversion; Recursive utility; Risk aversion; Social discount rate; Uncertainty; Political Economy; Risk and Uncertainty; D61; D81; D90; H43; Q00; Q54.

Ano: 2009

URL: http://purl.umn.edu/55785

Sgobbi, Alessandra; Carraro, Carlo.

The relevance of bargaining to everyday life can easily be ascertained, yet the study of any bargaining process is extremely hard, involving a multiplicity of questions and complex issues. The objective of this paper is to provide new insights on some dimensions of the bargaining process asymmetries and uncertainties in particular by using a non-cooperative game theory approach. We develop a computational model which simulates the process of negotiation among more than two players, who bargain over the sharing of more than one pie. Through numerically simulating several multiple issues negotiation games among multiple players, we identify the main features of players optimal strategies and equilibrium agreements. As in most economic situations,...

DYNAMICS AND UNCERTAINTY IN ENVIRONMENTAL AND NATURAL RESOURCE MANAGEMENT UNDER SCARCITY: THE CASE OF IRRIGATION

Palavras-chave: Bargaining; Non-Cooperative Game Theory; Simulation Models; Uncertainty; Risk and Uncertainty; C61; C71; C78.

Ano: 2007

URL: http://purl.umn.edu/8224

Bontemps, Christophe; Couture, Stephane.

The objective of this paper is to study the problem of management of irrigation water. We analyse farmers' economic rules of tactical irrigation scheduling in a certain or uncertain environment under water scarcity. The optimal plans depend on uncertain weather conditions and expectations. We develop a dynamic economic model of irrigation water applications under certain or uncertain weather conditions and in the context of a limited total quantity of water. We program this economic model, introducing the agronomic model EPIC, which is used to obtain information on the crop yield. The model is used to explain the optimal irrigation management plan of corn in the area of Toulouse (France). This model improves water management and leads to substantial...

Agri-Environmental Policy and Moral Hazard under Output Price and Production Uncertainty

Palavras-chave: Dynamic optimization; Irrigation management; Agroeconomic modeling; Uncertainty; Research Methods/ Statistical Methods; Resource /Energy Economics and Policy; Risk and Uncertainty.

Ano: 1999

URL: http://purl.umn.edu/21504

Yano, Yuki; Blandford, David.

Several theoretical and empirical models have been developed to examine how risk aversion affects compliance with agri-environmental schemes under asymmetric information and uncertainty. However, none has examined the case where the level of compliance is a continuous variable and producers face simultaneous monitoring, output price and production uncertainty. Treating conservation effort as a continuous variable, we show that risk aversion can mitigate the moral hazard problem in most cases. However, if conservation effort has a risk-increasing impact on production the effect of risk aversion on compliance is ambiguous.