While there is mixed evidence of the impact of food assistance programs on obesity, there is general agreement that the food-insecure are at higher risk of obesity and obesity-related diseases. Food assistance programs, originally designed to overcome a lack of available food, now need to confront a very different problem: how to provide for the food-insecure while encouraging healthy lifestyles. This paper examines the potential to address these competing needs using traditional economic policies (manipulating information or prices) versus policies engaging behavioral economics and psychology.

This paper examines grocery retailers' ability to influence prices charged to consumers and paid to suppliers. We discuss how retailer market power manifests itself in terms of pricing and marketing strategies by setting forth and offering evidence in support of eight “stylized facts” of retailer pricing and brand decisions. We argue that little, if any, of this behavior can be explained by a model of a competitive, price-taking retailer, but that most of the indicated behavior was also inconsistent with traditional models of market power. Finally, we discuss the impacts of aspects of this retailer behavior on the upstream farm sector.

This article documents the need for reform of milk pricing in the Northeast. The New York price gouging law can be recast as a fair share law. This new milk policy “kills two birds with one stone.” It corrects regional inequities in raw milk pricing by reforming the pricing of milk at retail by limiting and redistributing excessive retail margins to farmers and consumers. The fair share policy relieves allocative price inefficiency, improves the performance of the federal milk market order pool, and improves the general performance of the Northeast dairy farming and fluid milk industries.

This paper uses Theil's (1979) entropy-based measure of inequality and farm-level data to examine changes in farm business wealth (farm equity) of farm households. The farms associated with farm households are grouped by state into ten regions of the United States. The Theil entropy measure is then calculated and used to decompose total inequality of farm wealth into within-state and across-states (between states) inequalities for each region. Results show that since the enactment of the 1996 Federal Agricultural Improvement and Reform (FAIR) Act, inequality in farm wealth among farms within a state has decreased relative to the number of farms per state, across all regions. Further, most of the reduction in farm wealth inequality is attributed to increased equality in the distribution of real estate assets of the farm households, a major component of farm wealth.

Perron's test, Johansen cointegration analysis, and a vector error-correction (VEC) model are used to identify structural change, as well as to examine price dynamics in the U. S. and Canadian hard red spring (HRS) and durum wheat markets. It is found that, due to the U. S. Export Enhancement Program (EEP), price instability experienced in June 1986 has resulted in structural changes for Canadian HRS and durum prices. We also find that Canadian prices have significant effects on the determination of the U. S. prices in the North American wheat market.

The case of reduction in ad valorem tariffs as a trade liberalization policy is considered in this article. It is shown that the reduction leads to a higher quality of imports, ceteris paribus. This hypothesis was tested on the case of Japanese beef imports from the United States and Australia. U. S. beef, according to the results of Gallup surveys, is considered by Japanese consumers to be a high quality product, while Australian beef is considered to be a low quality product. Empirical results support the hypothesis. Moreover, the recent domination of U. S. beef in the Japanese market is further explained by increasingly more efficient U. S. beef production relative to Australian production and a strong income effect, where an increase in per capita income leads to more demand for higher quality products.

The main objective of this research is to compare estimates of technical efficiency obtained from the stochastic frontier approach for two samples of farmers of private and water user associations in the Nefzaoua Oases region (Tunisia), which are characterized by a severe scarcity of water and especially a high degree of salinity. Technical inefficiency effects are modeled as a function of farm-specific socioeconomic factors. Results suggest that both systems are technically inefficient. On average, the private system is found to be slightly more efficient than the associative one. Date yield could be explained mainly by four variables: water quantity applied per palm tree, labor per palm tree, phosphate per palm tree, and water salinity. Output elasticities of all inputs are found to be positive and significant except for the farmyard manure. Water salinity has a considerable negative impact on date productivity. For the technical inefficiency model, none of the socioeconomic variables seem to matter.

This study analyzes U. S. consumers' choice of cornflakes under five different labeling statements. Using a nationwide survey and choice modeling framework, results indicate that consumers value labeling statements differently, depending on the information contained on the label. The random parameter logit model results indicated that, compared to cornflakes that have no label information, cornflakes labeled “contains no genetically modified com” have a value of 10 percent more, the label “USDA approved genetically modified com” has a value of 5 percent more, and the label “com genetically modified to reduce pesticide residues in your food” has a value of 5 percent more. The results also suggest that consumers negatively valued the label “contains genetically modified com,” paying 6.5 percent less, and the label “may contain genetically modified com,” paying 1 percent less than the product that has no label information.

Wheat types may be classified according to strength, a baking characteristic. Since the demand for wheat is derived demand, the baking characteristic is directly related to end use. Accordingly, the wheat classes that are used in this study are divided into sub-groups according to strength, that is, strong, medium, and weak wheats. Time-series methods are employed to determine how the different classes of wheats are related within each sub-group. The different wheats under the different sub-groups are found to be substitutes to various degrees, but form a robust cointegrating relationship, implying that the wheat prices in these markets are bound together by a long-term equilibrium relationship. Within each of the sub-groups, the U.S. wheats were found to act as a price leader, driving the prices of other wheats belonging in the same sub-group. These U. S. wheats were found to form no long-run relationship between each other given their distinct end uses. The study highlights the importance of differentiating wheat by end use to specify price linkages more accurately.

Agricultural policymakers place increasing emphasis on developing efficiency measures for organic producers in order to evaluate regulatory strategies and evolving organic market conditions. We develop technical efficiency measures for U. S. organic farmers using a stochastic production frontier. Farm decisions about acquiring and managing organic soil materials from on-farm and local sources are incorporated into the technical efficiency measure. Productivity differences between newer entrants to organic farming and more experienced producers are estimated in order to isolate the impact of learning and management expertise on farm-level technical efficiency.

The Dixit entry/exit real option model was applied to the entry/exit decisions of New York dairy farmers. For the cost structure of a 500-cow farm, the entry milk price is $17.52 per hundredweight (cwt) and the exit milk price is $10.84. For the 50-cow farm cost structure, the entry price is higher at $23.71 per cwt, and the exit price is also higher at $13.48. If infinite numbers of representative farms enter and exit at these prices, the price of milk should range between $13.48 and $17.52 per cwt.

We use contingent behavior analysis to study the effects of pfiesteria-related fish kills on the demand for seafood in the Mid-Atlantic region. We estimate a set of demand difference models based on individual responses to questions about seafood consumption in the presence of fish kills and with different amounts of information provided about health risks. We use a random-effects Tobit model to control for correlation across each observation and to account for censoring. We find that (i) pfiesteria-related fish kills have a significant negative effect on the demand for seafood even though the fish kills pose no known threat to consumers through seafood consumption, (ii) seafood consumers are not responsive to expert risk information designed to reassure them that seafood is safe in the presence of a fish kill, and (iii) a mandatory seafood inspection program largely eliminates the welfare loss incurred due to misinformation.

Data on the number of Pennsylvania dairy farms by size category are analyzed in a Markov chain setting to determine factors affecting entry, exit, expansion, and contraction within the sector. Milk prices, milk price volatility, land prices, policy, and cow productivity all impact structural change in Pennsylvania's dairy sector. Stochastic simulation analysis suggests that the number of dairy farms in Pennsylvania will likely fall by only 2.0 percent to 2.5 percent annually over the next 20 years, indicating that dairy farming in Pennsylvania is likely to be a significant enterprise for the state in the foreseeable future.

This research compared bids that consumers placed on non genetically modified (GM), organic, and conventional versions of food products in order to determine if the organic market well serves those seeking to avoid GM foods. Auction experiments using potato chips, tortilla chips, and milk chocolate were conducted with 79 subjects. Bids were modeled as a function of consumer demographics using a heteroskedastic tobit regression model. Results with the non-GM attribute nested into the organic characteristic showed that the latter's marginal effects were insignificant. This suggested the potential to further develop non-GM products for consumers not willing to pay extra for the remaining organic attributes.