SS-AAEA Journal of Agricultural Economics
A journal of agricultural economic research inspired, performed, and written by undergraduate students.

 

Demographic Influences on Willingness-To-Pay for Cold Tolerance Technology?
Author: Becky McCorkle.
Institution: Department of Rural Economy. University of Alberta.
Advisor: Ellen Goddard, University of Alberta.
Article 1.

New technologies in agriculture have the potential to increase production levels, reduce risk, and improve profits for farm operators. However, in order for this to take place the technologies must appeal to producers, creating enough interest that they decide to invest in them. Gauging the level of interest in a technology and the types of producers who will be interested in trying it are important steps in technology development. Cereal crops such as wheat are important to agriculture in Canada in terms of both acreage and revenue. Researchers in Canada are currently attempting to develop more cold tolerant cereal crops to reduce the risk of frost damage and increase the area available to produce these crops. A producer survey including questions on past adoption behavior, attitudinal characteristics, and demographics as well as a set of dichotomous choice questions on new varieties was conducted and analyzed using a regression and willingness to pay calculations. Demographics were the focus during these activities. It was determined that producers from areas experiencing frost regularly with high incomes and large land bases had a higher propensity to adopt and higher willingness to pay for this technology.

Arkansas Producers' Attitudes Towards the 2002 Farm Bill and Preferences for
the 2007 Farm Bill
.

Author: Misti Clark
Institution: Department of Agricultural Economics and Agribusiness. Arkansas State University
Advisor: Unknown
Article 2.

The Federal Security and Rural Investment Act of 2002, otherwise known at the 2002 Farm Bill, contains current legislation regarding federal public policies and programs for U.S. food and agriculture. This legislation will expire in 2007 and thus new legislation will be developed. It is important to have farm producers’ input for developing this legislation because the policies and programs influence their business practices and livelihoods. The purpose of this study was to determine Arkansas producers’ attitudes towards current and future farm legislation based on an analysis of a survey administered to Arkansas farm producers in the summer of 2006. The main finding of this research is that Arkansas producers would like to create more incentives for biofuel research. They also indicate through survey preferences that risk management policies such as insurance, disaster assistance, and labeling of foods should be addressed more thoroughly with more funding allocated to these areas. Arkansas producers are not in favor of eliminating current commodity payments although there was a significant difference of opinion in this area between those who produce program crops and those who do not. These study results provide an important assessment of producer preferences for future farm legislation.

Hedonic Pricing of Bulls.
Author: Jenna M. Smith
Institution: Department of Agricultural Economics. Purdue University
Advisor: Ken Foster, Purdue University
Article 3.

Bulls account for half of the genetic input when making improvements in cattle herds. Therefore, to make a rapid, less costly improvement a cattle producer is more likely to change bulls than cows. One of the problems that breeders who supply bulls face is that the attributes of bulls come bundled together so that it is difficult to determine what the value of improvements in a bull might be worth. This research estimates what values beef producers implicitly place on particular characteristics when deciding which bull will best fit the needs of their farm. A hedonic pricing model was estimated using actual transaction data and reveals the value buyers of bulls implicitly place on specific traits. For example, a ribeye area of 12.8 in 2 at the mean sale price reveals a buyer would be willing to pay an additional $80.39 for a bull with an additional square inch. Likewise, a bull with a 1242 lb. 365-day weight at the mean sale price reveals a buyer would be willing to pay an additional $1.83 for an additional pound. Therefore, this research reveals an incentive for bull producers to focus on improving the genetic make-up of their bulls they offer for sale..

The Impact of Personal Attitudes on Cereal Variety Adoption Decisions in Alberta.
Author: Jesse Cole
Institution: Department of Rural Economy. University of Alberta.
Advisor: Ellen Goddard, University of Alberta.
Article 4.

The goal of this study was to help guide development efforts of a current breeding program underway in Saskatoon, Saskatchewan, aimed at producing new cold tolerant cereal varieties. In order to maximize the impact of research dollars and efficiently meet the needs of producers in the realm of technology provision, it is helpful to understand the types of producers who might use the new varieties. A survey was used, in Alberta, Canada, to obtain data on producer attitudes affecting adoption of new technology, particularly in adopting a future cold tolerant cereal variety. The survey was structured with demographic, attitudinal and stated choice questions. A conditional logit regression model was used to estimates the probability of adoption based on the survey responses. Principal component analysis was used to limit the number of variables in the regression. Willingness to pay calculations are then made based on the selected logit model. Frost tolerance is found to be the most desired trait over a decrease in degree days for the sample population. Certain producer characteristics (attitudes towards risk, for example) were found to impact on the estimated willingness to pay for frost tolerance and decreased days to maturity.

The Effect of Social Desirability Bias on Willingness-To-Pay for Organic Beef.
Author: Lindsey Cheek
Institution: Department of Agricultural Economics. Oklahoma State University
Advisor: F. Bailey Norwood, Oklahoma State University.
Article 5.

Researchers regularly conduct willingness-to-pay or valuation studies for product marketing or public policy purposes. However, a large volume of research suggests valuation tools such as conjoint analysis may be subject to social desirability bias, where subjects misrepresent their true preferences to create a favorable impression. The objective of this study is to measure the effects of social desirability bias on conjoint survey responses. Consumers were asked to rank organic ground beef relative to other ground beef products at various prices. A popular scale measuring individuals’ tendency to exhibit social desirability bias was also administered. Regression analysis found no correlation between individuals’ social desirability scale scores and their preferences for organic beef. Thus, in this study, social desirability bias does not appear to be a problem for valuation researchers.

Does Attractiveness Increase Sales Productivity?
Author: Robert W. Prickett
Institution: Department of Agricultural Economics. Oklahoma State University
Advisor: F. Bailey Norwood, Oklahoma State University.
Article 6.

Previous studies found individuals’ attractiveness or beauty is positively correlated with job success. Is this success due to attractiveness alone, or does attractiveness induce greater productivity? This study was conducted to measure the effects of attractiveness on sales productivity. Data from an undergraduate sales class at Purdue University were used to measure the impact of individuals’ attractiveness on sales revenue. Regression analysis was used with sales revenue as the dependent variable and attractiveness measures as independent variables, along with other variables. An asymmetric impact of attractiveness exists for males and females. More attractive females have higher sales revenues, but beauty is unrelated to sales performance for males.

Do Farm Credit Customers Prefer Lower Interest Rates or Higher Patronage Payments?
Author: Quatie Jorgensen
Institution: Department of Agricultural Economics. Oklahoma State University
Advisor: Brian Briggeman, Oklahoma State University.
Article 7.

Farm Credit Services of East Central Oklahoma (FCSECO) is part of a nation-wide cooperative that supplies financing for full-time and part-time farmers. FCSECO not only makes loans to farmers but because it is a cooperative, its members/borrowers also benefit from what is known as the patronage payment. The patronage payment is a way of distributing Farm Credit’s profits to its members/borrowers. Since FCSECO is customer-focused and customer-driven, it is essential that the FCSECO Board of Directors knows their customer base and what they desire as a customer. It would benefit FCSECO to determine the substitutability between patronage payments and fixed interest rates.

A conjoint survey was conducted on random FCSECO customers. After performing an OLS regression analysis, the results illustrated that the average FCSECO customer values a higher patronage payment more than a lower fixed interest rate on a given loan. This information is valuable to the FCSECO Board of Directors because it shows which attribute the average FCSECO customer has a preference towards. Since the average FCSECO customer greatly values the patronage payment, the FCSECO Board of Directors could use the patronage payment to its advantage in securing new loans.

Do Environmental Attitudes Predict Organic Purchasing and Environmental Organization Involvement?
Author: Alicia Entem.
Institution: Department of Rural Economy. University of Alberta.
Advisor: Sean Cash, University of Alberta.
Article 8.

The members of affluent Western societies have become increasingly aware of environmental issues. The increases in environmental awareness have created new environmentally conscious markets, such as organic foods and products, and organizations. This article looks at whether socio-demographic variables can predict environmental attitudes and whether there is a connection between environmental attitudes and the realization of behaviours that promote environmental protection (organic food purchases and environmental group membership). In Edmonton, Alberta, Canada and surrounding communities, health and environment attitudes as well as demographic information were collected through intercept surveys administered at locations that ensured a representative sample of the communities (n = 389). Regression analyses in STATA 7.0 were used to determine the predictive abilities of environmental attitudes and socio-demographic variables on environmental attitudes and environmental behaviours respectively. It was found that socio-demographic variables provided limited explanatory power for environmental attitudes and that while environmental attitudes and behaviours are correlated, environmental attitudes are unable to accurately predict environmental behaviours. The lack of explanatory power may be due to the scale used, or more likely due to the general acceptance and knowledge of environmental issues. As environmental attitudes become more commonplace, differences in socio-demographic factors may no longer have the predictive ability once seen in past studies.

Cooperatives, Credit Unions, and Social Engagement in Canada.
Author: Travis Kennedy.
Institution: Department of Rural Economy. University of Alberta.
Advisor: Unknown.
Article 9.

Co-operatives serve as engines for local economies; generating and retaining local wealth, operating through existing social networks within communities and providing economic opportunities for local people. Is there a correlation between levels of social engagement and the presence of co-operatives and credit unions? Using the Statistics Canada GSS survey, 2003 and Environics Analytics, Business Locations data it is possible to assess the linkages between social engagement and the presence of co-operatives in Canada. Linkages between demographics (including the breakdown of rural/urban co-operatives and credit unions) and social engagement we isolated volunteerism as a dependant variable in logit regressions. It was established that: across Canada, the older people are, if an individual is female, the larger her or his household is, the less TV he or she watches, the more she or he uses internet, the higher the rate of highschool graduation, the more trusting people are of their neighbours, the more rural an area is, the more fully employed people are, the less likely they are to say no to volunteerism. Although, in all provinces the rural areas have higher levels of social engagement, social engagement is not a direct indicator for the existence of higher levels of co-operative businesses.

Effect of Calf Health on Feedlot Performance and Carcass Value.
Author: Shana Robson.
Institution: Department of Agricultural Economics. Oklahoma State University.
Advisor: Clem Ward, Oklahoma State University.
Article 10.

This paper addresses if calf health does affect feedlot performance and carcass value. The physiological aspects of this question as well as a regression analysis to further evaluate this problem will be addressed in this paper. A large set of data that can help to explain this health and value question has been made available for this study. These data were collected from the years 1990 - 2005 from a cattle feeding and carcass program in Coyle, Oklahoma as part of an Oklahoma State University program entitled the OK Steer Feedout (University 2004-2005). The information found in the physiological examination of this question indicates that calf health greatly affects feedlot performance and carcass value. The loss of muscle and fat deposits due to the immune response launched by the calf to fight disease, suggests a loss in marbling and carcass weight. The decrease in appetite creates a lower average daily gain, affecting the out weight of the calf. The symptoms seen as a result of infection affect feedlot performance, yield grade, and quality grade. The extent of the influence of sickness on the characteristics that determine performance characteristics was determined by the regression models. The models indicate medical costs (which indicate sick cattle) negatively affect performance characteristics. To cow/calf producers, this creates the opportunity to provide healthy cattle and to be justified in receiving a premium for their product. For feedlots and stockers, it means a more valuable consistent product, cattle with better average daily gains, and fewer days on feed. Economically, the cattle industry stands to benefit from the promotion of healthy cattle. How much they stand to benefit requires further research.