Bilateral bargaining between chicken producers and processing firms determined chicken prices in Ontario from 1995 to 2002. A significant reform in 2003 introduced a formula-based live price that is a function of chicken producers' costs. The latter pricing mechanism reduces the risk faced by processing firms and producers because the chicken price is known when output decisions are made. However, the pricing formula also involves some risk in that the cost components may be far removed from actual costs when production is carried out. Expected farm prices under the two different pricing mechanisms are also not identical. The producers' and processors' expected utility of profits under each pricing mechanism is computed. The bargaining pricing mechanism generally yields higher expected utility for producers than the formula-based price. Conversely, processing firms obtain a higher expected utility under the formula-based pricing than under the bargaining framework. These conclusions critically hinge on the size of the producers' margin component in the formula-based price. In that sense, the formula-based pricing mechanism did not lessen the significance of relative bargaining strengths in establishing the distribution of welfare in the chicken industry . Des négociations bilatérales entre les producteurs de poulet et les entreprises de transformation déterminaient le prix du poulet vivant en Ontario de 1995 à 2002. Une formule de prix établie en fonction des coûts de production des producteurs de poulet fut introduite en 2003. Ce mécanisme réduit le risque auquel sont confrontés les transformateurs et les producteurs parce que le prix du poulet vivant est connu lorsque les décisions de production sont prises. Cependant, la formule de prix comporte aussi un risque dans le sens où la composante du coût dans la formule de prix peut être différente des coûts réels de production du poulet vivant. Les prix espérés du poulet vivant sont aussi différents dans les deux systèmes de prix. L'utilité espérée des profits pour les producteurs et les transformateurs de poulet est calculée dans les deux mécanismes. Le modèle fondé sur la négociation génère une utilité espérée des profits plus élevée pour les producteurs que la formule de prix. À l'inverse, les transformateurs obtiennent une utilité espérée des profits plus élevée selon la formule de prix que selon le modèle fondé sur la négociation. Ces conclusions sont étroitement liées à la taille de la marge des producteurs utilisée dans le calcul de la formule de prix. Dans ce sens, l'introduction d'un nouveau mécanisme de détermination des prix n'a pas modifié l'importance du pouvoir relatif de négociation dans la distribution du surplus économique au sein de la filière canadienne du poulet .
Bilateral bargaining between chicken producers and processing firms determined chicken prices in Ontario from 1995 to 2002. A significant reform in 2003 introduced a formula‐based live price that is a function of chicken producers' costs. The latter pricing mechanism reduces the risk faced by processing firms and producers because the chicken price is known when output decisions are made. However, the pricing formula also involves some risk in that the cost components may be far removed from actual costs when production is carried out. Expected farm prices under the two different pricing mechanisms are also not identical. The producers' and processors' expected utility of profits under each pricing mechanism is computed. The bargaining pricing mechanism generally yields higher expected utility for producers than the formula‐based price. Conversely, processing firms obtain a higher expected utility under the formula‐based pricing than under the bargaining framework. These conclusions critically hinge on the size of the producers' margin component in the formula‐based price. In that sense, the formula‐based pricing mechanism did not lessen the significance of relative bargaining strengths in establishing the distribution of welfare in the chicken industry . Des négociations bilatérales entre les producteurs de poulet et les entreprises de transformation déterminaient le prix du poulet vivant en Ontario de 1995 à 2002. Une formule de prix établie en fonction des coûts de production des producteurs de poulet fut introduite en 2003. Ce mécanisme réduit le risque auquel sont confrontés les transformateurs et les producteurs parce que le prix du poulet vivant est connu lorsque les décisions de production sont prises. Cependant, la formule de prix comporte aussi un risque dans le sens où la composante du coût dans la formule de prix peut être différente des coûts réels de production du poulet vivant. Les prix espérés du poulet vivant sont aussi différents dans les deux systèmes de prix. L'utilité espérée des profits pour les producteurs et les transformateurs de poulet est calculée dans les deux mécanismes. Le modèle fondé sur la négociation génère une utilité espérée des profits plus élevée pour les producteurs que la formule de prix. À l'inverse, les transformateurs obtiennent une utilité espérée des profits plus élevée selon la formule de prix que selon le modèle fondé sur la négociation. Ces conclusions sont étroitement liées à la taille de la marge des producteurs utilisée dans le calcul de la formule de prix. Dans ce sens, l'introduction d'un nouveau mécanisme de détermination des prix n'a pas modifié l'importance du pouvoir relatif de négociation dans la distribution du surplus économique au sein de la filière canadienne du poulet .
Several theories postulate that private ownership of land is necessary to encourage investment and adoption of new technologies. However, empirical studies do not always confirm those theories, as is the case with the present study, conducted in the Zoghmar community, located in the semi-arid region of Tunisia. Statistical analyses suggest that land tenure conditions are unrelated to alternative production systems and to the community's socioeconomic dynamics. Several production systems were identified in the community but no statistically significant relationships were established between alternative types of land tenure and production systems. Moreover, net farm income did not seem to be related to land tenure, nor to alternative farming systems. However, the way farmers acquired their land did show a slight relationship with net farm income.
ABSTRACT Several theories postulate that private ownership of land is necessary to encourage investment and adoption of new technologies. However, empirical studies do not always confirm those theories, as the case with the present study, conducted in the Zoghmar community, located in the semi-arid region of Tunisia. Statistical analyses suggest that land tenure conditions are unrelated to alternative production systems and to the community's socio-economic dynamics. Several production systems were identified in the community but no statistically significant relationships were established between alternative types of land tenure and production systems. Moreover, net farm income did not seem to be related to land tenure, nor to alternative farming systems. However, the way farmers acquired their land did show a slight relationship with net farm income.
The Canadian government ratified the Kyoto Protocol in December 2002. The protocol calls for greenhouse gas emissions to be reduced by 6 percent below the 1990 level (approximately 35 percent below what they are expected to be in a business-as-usual situation) by 2008–2012. To help meet this target, both federal and provincial governments in Canada have developed programs (in some cases mandates) for ethanol and biodiesel production and use in fuel blends. Various subsidy schemes have been designed to stimulate development of a biofuels industry in Canada. While the programs have been promoted on the basis of environmental concerns, a major driver has been the search for new markets for Canadian agricultural commodities that face chronically depressed prices. The purposes of this article are to review the current state of policies, programs and production of ethanol and biodiesel in Canada and to assess the prospect of these biofuels to significantly reduce production of greenhouse gases in Canada.
The purpose of this paper is twofold. Our first objective is to measure the level of technical efficiency of Québec dairy farms. Our second objective is to gauge the robustness of our results with respect to the selection of a functional form and of a distribution for the inefficiency index. We estimate efficiency frontiers for Cobb-Douglas (C-D), translogarithmic (TL) and generalized Leontief (GL) production functions with half-normal, truncated normal and exponential distributions. Our results, based on likelihood dominance criterion (LDC) indicate that the GL production technology dominates the other two functional forms, and this ranking is robust to changes in the distribution of the inefficiency index. Efficiency scores and ranks are highly correlated for all the functional forms and distributions. The differences in the mean levels of efficiency are statistically significant across functional forms and distributions, although the magnitude of the difference is minuscule. The very high mean level of efficiency and the low standard deviation confirms that Québec dairy farms are very homogenous in terms of getting the most from their inputs. This is not surprising, given that the sector has been very stable policywise and that it has been difficult for dairy farmers to expand. To augment the comparisons, results obtained from data envelopment analysis (DEA), are added to the analysis. In this case, the correlation coefficients between DEA and parametric specifications are found to be very low.
The purpose of this paper is twofold. Our first objective is to measure the level of technical efficiency of Quebec dairy farms. Our second objective is to gauge the robustness of our results with respect to the selection of a functional form and of a distribution for the inefficiency index. We estimate efficiency frontiers for Cobb-Douglas (C-D), translogarithmic (TL) and generalized Leontief (GL) production functions with half-normal, truncated normal and exponential distributions. Our results, based on likelihood dominance criterion (LDC) indicate that the GL production technology dominates the other two functional forms, and this ranking is robust to changes in the distribution of the inefficiency index. Efficiency, scores and ranks are highly correlated for all the functional forms and distributions. The differences in the mean levels of efficiency are statistically significant across functional forms and distributions, although the magnitude of the difference is minuscule. The very high mean level of efficiency and the low standard deviation confirms that Quebec dairy farms are very homogenous in terms of getting the most from their inputs. This is not surprising, given that the sector has been very stable policy-wise and that it has been difficult for dairy farmers to expand. To augment the comparisons, results obtained from data envelopment analysis (DEA), are added to the analysis. In this case, the correlation coefficients between DEA and parametric specifications are found to be very low.
A marketing margin model that allows testing for constant returns to scale technology and asymmetric marketing costs and farm price transmissions is proposed. Results indicate that a constant returns to scale technology cannot be rejected. During the period prior to the enactment of the price gouging law in June 1991 by the New York State Legislature, significant short-run and long-run asymmetries in both marketing costs and farm price transmissions were identified. After 1991, these asymmetries were no longer significant or were reduced substantially. Finally, the legislative change that occurred in 1987, allowing Farmland Dairies' entry into the New York City fluid milk market, contributed significantly to reducing marketing margins in the New York City fluid milk market. [EconLit Citations: D400, C300] © 2002 Wiley Periodicals, Inc.
La présente étude propose une approche similaire à celle de Lichtenberg et Zilberman pour modéliser l'impact d'intrants qui agissent comme agents de contrôle (insecticides, fongicides, herbicides) sur la production de pomme de terre. Dans cette perspective, nous estimons, à l'aide de procédures économétriques, un système d'équations simultanées expliquant la production commercialisable de pommes de terre et trois types de dommage. Les résultats empiriques montrent que les effets des éléments fertilisants (azote, phosphore, potassium et magnésium) sur la production potentielle de pomme de terre ne sont pas statistiquement significatifs. En revanche, des impacts significatifs se retrouvent dans les fonctions de réduction des dommages pour le phosphore et le potassium. Ces derniers résultats montrent des effets antagoniques sur les pertes causées par le faible calibre des tubercules : ainsi, le phosphore contribue à les augmenter tandis que le potassium joue un rôle opposé. Plusieurs variables traduisant les pratiques culturales ont également été incorporées dans le modèle mais peu d'entre elles se sont avérées comme étant significatives.
On October 3, 1987, Canada and the United States signed a Trade Agreement (CUSTA) which came into force on January 1, 1989. Included in this agreement, all tariffs on dairy products which were not on the Import Control List (ICL) subject to GATT rules were to be eliminated over ten years. Products not included on the list at the time of signing the agreement included ice cream and yogurt. Canada added these products to the ICL early in 1988. A GATT Panel ruled that such action was illegal basically because these processed products were not considered to be "like products" to raw or liquid milk to which the Article XI provisions of the GATT applied, provisions that allowed import quotas if certain restrictive conditions were met. Canada refused to withdraw these products from the ICL, deferring action on this issue until GATT negotiations were completed. Canada argued that GATT Article XI would be made more restrictive, thus legitimizing its action.
first time. This first agreement forced relatively modest changes in the way agricultural policy is conducted in Canada but it set pace for more profound changes, in particular for the supply managed sectors. There is now a strong and irreversible trend towards increased market liberalization, i.e. the reduction of tariff and non-tariff barriers. Policies that isolate the domestic market from international competition will increasingly be challenged. In fact, supply management in the dairy sector has already been challenged by the United States and New-Zealand. The decision of the WTO Panel was partly in favour of the complaining parties and adjustments to the marketing system had to be made. The Panel decision did not seem to satisfy the complaining parties because they are expected to file another complaint in February 2001. The outcome of this challenge is unknown but it may have significant repercussions on the Canadian dairy industry. The dairy sector has been isolated from international competition for more than thirty years and the evolution of its structure and of its productivity has been largely affected by this market environment. However, with evident signs that the dairy sector will have to adapt to a more open economic environment, actions will have to be taken by industry stakeholders to ensure its survival in the medium and long run. The objectives of this paper are threefold: 8 Introduce some indicators of how the structure and performance of the dairy sector have evolved both in Canada and the United States. This comparison will allow us to position the Canadian industry in relation to the
Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomieVolume 49, Issue 4 p. 479-492 Dairy Economic and Policy Issues between Canada and the United States Robert F. Romain, Robert F. Romain Professor, Département d'économic agroalimentaire et des sciences de la consommation; and Director, Centre for Research in the Economics of Agrifood (CREA), Université Laval, Saint-Foy, Québec.Search for more papers by this authorDaniel A. Sumner, Daniel A. Sumner Frank H. Buck, Jr., Professor, Department of Agricultural and Resource Economics, University of California, Davis, California.Search for more papers by this author Robert F. Romain, Robert F. Romain Professor, Département d'économic agroalimentaire et des sciences de la consommation; and Director, Centre for Research in the Economics of Agrifood (CREA), Université Laval, Saint-Foy, Québec.Search for more papers by this authorDaniel A. Sumner, Daniel A. Sumner Frank H. Buck, Jr., Professor, Department of Agricultural and Resource Economics, University of California, Davis, California.Search for more papers by this author First published: 15 July 2005 https://doi.org/10.1111/j.1744-7976.2001.tb00320.xCitations: 7 Paper presented at the joint AAEA-CAES annual meetings in Chicago, Illinois, 5–8 August 2001. AboutPDF ToolsRequest permissionExport citationAdd to favoritesTrack citation ShareShare Give accessShare full text accessShare full-text accessPlease review our Terms and Conditions of Use and check box below to share full-text version of article.I have read and accept the Wiley Online Library Terms and Conditions of UseShareable LinkUse the link below to share a full-text version of this article with your friends and colleagues. Learn more.Copy URL Share a linkShare onEmailFacebookTwitterLinkedInRedditWechat REFERENCES Balagtas, Joseph V. and Daniel A. Sumner 2001. The Effect of the Northeast Dairy Compact on Producers and Consumers, with Implication of Compact Contagion. Davis , CA : University of California, July. Barichello, Richard R. 1999. The Canadian dairy industry: Prospects for future trade. Canadian Journal of Agricultural Economics, 47 (5): 45–55. Barichello, R., and R. Remain 1996. Prospects for the Canadian dairy sector following the upcoming NAFTA panel ruling. In Understanding Canada/United States Dairy Disputes, edited by R.M.A. Loyns, R.D. Knutson and K. Meilke, pp. 163–96. Winnipeg , MB : Friesen Printers, December. California. Department of Food and Agriculture. Various. Dairy Information Bulletin. Sacramento, CA: CDFA, Division of Marketing Services, Dairy Marketing Branch, http://www.cdfa.ca.gov. Dairy Farmers of Canada. 2001. Compendium of Arguments in Support of the Competitiveness of Canadian Dairy Producers. Document 16. Presented at the annual meeting in Winnipeg. June. Dickrell, Jim. 2001. Dairy Today' Report, 3 August. GREPA. 2000. Les faits saillants laitiers québécois, 1999, Département d'économie agro-alimentaire et ses sciences de la consommation, Université Laval, Québec, http://alpha.eru.ulaval.ca/grepa/. Knutson, R. D., R. Romain, D. P. Anderson and J. W. Richardson 1997. Farm Level Consequences of Canadian and U.S. Dairy Policies. Canadian Journal of Agricultural Economics, 45: 421–432. Lariviére, S. and K. Meilke 1999. An assessment of Partial Dairy Trade Liberalization on the U. S., EU-15 and Canada. Canadian Journal of Agricultural Economics. 47(5): 59–73. Meilke, Karl, Rakhal Sarker, and Danny Le Roy. 1996. U.S.-Canadian Dairy Trade Tensions: The Nature and Effects of Canadian Dairy Policy. In Understanding Canada/United States Dairy Disputes. Edited by R. M. A. Loyns, R. D. Knutson and K. Meilke Friesen Printers, Winnipeg , Manitoba . December, pp. 241–272. Romain, Robert. 2001. The Future of the Dairy Industry in Canada. In Advances in Dairy Technology, Striving for Sustainability. Vol. 13. University of Alberta, Department of Agricultural, Food and Nutritional Science, Edmonton , pp. 337–353. Romain, R. and R. Lambert 1995. Efficacité technique et coûts de production dans les secteurs laitiers du Québec et de l'Ontario. Canadian Journal of Agricultural Economics. 43: 37–55. Rude, J. and J. P. Gervais 2000. Trade Liberalization in Supply-Managed Sectors. Available on the website of the Canadian Agrifood Trade Research Network, CATRN Paper 2000–10 (http://www.eru.ulaval.ca/catrn). Sumner, Daniel A. and Tom Cox. 1998. FAIR Dairy Policy. Contemporary Economic Policy, XVI. January: 58–68. Sumner, Daniel A. and Daniel G. Hallstrom. 1997. Commodity Policy Compatibility with Free Trade Agreements. In Harmonization/Convergence/Compatibility in Agriculture and Agri-food Policy: Canada, United States and Mexico, a Conference Proceedings. R. M. A. Loyns et al., eds. Winnipeg , Manitoba , Canada : University of Manitoba, pp. 47–61. Sumner, Daniel A. and Christopher A. Wolf. 1996. Quotas without Supply Control: Effects of Dairy Quota Policy in California. American Journal of Agricultural Economics. 78(2): 354–66. United States General Accounting Office. 2001. Dairy Industry: Information on Milk Prices and Changing Market Structure. GAO-01-561, June. United States General Accounting Office. 2001. Dairy Industry: Estimated Economic Impacts of Dairy Compacts GAO-01-866, September. Veeman, Michele and Robert St-Louis. 1996. U.S.-Canadian Dairy Trade Tensions: The Nature and Effects of Canadian Dairy Policy. In Understanding Canada/United States Dairy Disputes. Edited by R. M. A. Loyns, R. D. Knutson and K. Meilke Friesen Printers, Winnipeg , Manitoba . December, pp. 105–123. Zhu, Y., T. L. Cox, and J. P. Chavas 1999. An Economic Analysis of the Effects on the Uruguay Round Agreement and Full Trade Liberalization on the World Dairy Sector. Canadian Journal of Agricultural Economics. 47(5): 187–200. Citing Literature Volume49, Issue4December 2001Pages 479-492 ReferencesRelatedInformation
The hog/pork industry in Quebec has been going through major institutional changes since 1989, the year an electronic auction was put in place to market all of the hogs in the province. Because the auction's ability to generate high prices did not meet the expectations of hog producers, the pure auction system was replaced by a hybrid one in 1994. In this system, most of the hog supply was pre-attributed to processors at a negotiated price based on the US. price while the remainder of the provincial supply of hogs was sold through the auction. In this paper, we investigate how a seemingly inefficient marketing mechanism like pre-attributions can increase the efficiency of a usually efficient mechanism like an auction. We present theoretical arguments regarding the sustainability of collusion under the pure auction and hybrid systems in addition to analyzing auction prices with modern time series tools.
Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomieVolume 47, Issue 4 p. 470-471 The potato sector in Quebec: Production, product quality and impact of potential environmental regulation Robert Romain, Robert RomainSearch for more papers by this authorRémy Lambert, Rémy LambertSearch for more papers by this authorRenée Michaud et Claude Lapointe, Renée Michaud et Claude LapointeSearch for more papers by this author Robert Romain, Robert RomainSearch for more papers by this authorRémy Lambert, Rémy LambertSearch for more papers by this authorRenée Michaud et Claude Lapointe, Renée Michaud et Claude LapointeSearch for more papers by this author First published: 27 July 2007 https://doi.org/10.1111/j.1744-7976.1999.tb00448.xAboutPDF ToolsRequest permissionExport citationAdd to favoritesTrack citation ShareShare Give accessShare full text accessShare full-text accessPlease review our Terms and Conditions of Use and check box below to share full-text version of article.I have read and accept the Wiley Online Library Terms and Conditions of UseShareable LinkUse the link below to share a full-text version of this article with your friends and colleagues. Learn more.Copy URL Share a linkShare onFacebookTwitterLinked InRedditWechat No abstract is available for this article. Volume47, Issue4December 1999Pages 470-471 RelatedInformation
A hybrid approach to estimate the asymmetric price transmission between the farm gate and the retail market is proposed. The model is estimated for the fluid milk market of the Northeast U.S., that of the metropolitan area of New York City as well as that of Upstate New York. Spatially disaggregated data allows the impact of regional dairy regulation on the farm-retail price spread to be assessed, as well as the behavior of the middlemen regarding price transmission on markets with different levels of retail concentration to be estimated. Results suggest that intermediaries transmit variations in milk farm price in an asymmetric way in the short-run; that governmental intervention might force middlemen to act competitively in terms of price transmission; and that a high degree of concentration at the retail level is not synonymous with inefficient price transmission.
The objective of this study is to determine the impact of farm credit subsidies on the value of farmland in Canada. The price-components model based on the capitalization principle is developed and estimated using the pooled data from four selected provinces (Quebec, New Brunswick, Manitoba and Saskatchewan) from 1972 to 1991. The results show that increases (decreases) in interest subsidies are expected to increase (decrease) farmland and building values. However, the short-term impact is estimated to be small. The regional analysis shows that the abolition of interest subsidies across the country is likely to have a relatively higher impact on land and building values in Quebec than in the prairie provinces.