Anne Effland

Fueling the Automobile: An Economic Exploration of Early Adoption of Gasoline over Ethanol

When the automobile was developed near the beginning of the last century, it was the relatively new fuel gasoline, not the familiar ethanol that became the fuel of choice. We examine the intersections of the early development of the automobile and the petroleum industry and consider the state of the agriculture sector during the same period. Through this process, we find a series of influences, such as relative prices and alternative markets, that help to explain how in the early years of automobile development, gasoline won out over the equally likely technical alternative ethanol. We also examine the industrial relations in the automobile industry that seem to have influenced the later adoption of leaded gasoline, rather than ethanol, as a solution to the problem of engine knock.

Why Did Contracts Supplant the Cash Market in the Broiler Industry? An Economic Analysis Featuring Technological Innovation and Institutional Response

The decision to write contracts for production of commodities can be framed as an institutional response to changing industry and market conditions. When innovations increase available rents to technology owners (or technology appropriators), contracts can replace cash market transactions even though contracts carry higher transaction costs. We proceed by first fully documenting technological innovation in the broiler industry and tracing the evolution of contracts in the broiler industry. Next, we adopt a stylistic model to demonstrate how technological innovation might induce a switch to contract sales from cash market transactions. This paper contributes to the literature by investigating major institutional change in the broiler industry through an integrated analysis that weaves together industry history with elements of institutional economics, transaction cost theory, and game-theoretic economic analysis.

Income Stabilization through Government Payments: How Is Farm Household Consumption Affected?

We estimate the impacts of various types of government payments to U.S. agriculture on different components of farm household consumption. Using 2003 to 2005 data from the Agricultural Resource Management Survey (ARMS), we show that marginal rates of consumption differ by consumption category and income source, including different types of farm program payments. The results suggest that farm households treat income from different sources as imperfect substitutes and may reserve income from specific sources for specific types of consumption. Implications for the effects of different types of government payments on the farm household are considered.