Garnett L. Bradford

A Farm Firm Model of Machinery Investment Decisions

This article presents a multiperiod mixed integer programming (MMIP) model of optimal machinery decisions. Infinite horizon valuation models of replacement and other investment situations are conceptualized in the context of a finite programming model. Dual properties of the MMIP model are used to identify and value opportunity costs involved in investment decisions of farm machinery. The interdependent nature of investment and production relationships necessary for solving these values emphasizes the importance of a holistic firm perspective in analyzing farm machinery investment strategies. An empirical situation is used to demonstrate model application.

Computer Graphics: An Educational Tool in Production Economics

Students usually have difficulty in understanding the nature of surfaces generated by two-input production functions. Isoquant maps in two dimensions are easy to draw, and wooden or plastic models have sometimes been used by instructors to help students discover the relationship between an isoquant map and the resultant production surface. However, these models are difficult to build and expensive. Moreover, the exact mathematical specification of the production function underlying the plastic or wooden model is usually ambiguous. But the most serious disadvantage of such a model is that even if a mathematical specification of the production function underlying the model is known, it is impossible with a single model for the instructor to change the underlying function (and hence the isoquant map) so that the student might observe the resulting impacts on the surface of the function. Computer graphics can be used as an educational tool for helping students better learn production economics concepts. A plotter linked to a computer is used to generate three-dimensional illustrations of two-input agricultural production functions.l Moreover, production economics problems often require the maximization or minimization of a function, and computer graphics can be used to develop an understanding of the mathematical conditions necessary and sufficient for a maximum or minimum. This use is particularly important to supplement material in beginning graduate level production economics classes.

A Sequential Model of the Farm Firm Growth Process

Multiperiod linear programming and computer simulation techniques are integrated into a single recursive-sequential model of the farm firm growth process. The model is tied to dynamic theories of the firms planning behavior first developed by Hicks and more recently by Modigliani and Cohen. A central Kentucky beef farm empirically illustrates predictive features of the model. Three alternative beef production management strategies are compared to demonstrate the models potential for explaining and predicting alternative farm firm growth processes.

ESTABLISHING LINKAGES BETWEEN ECONOMIC THEORY AND ENTERPRISE BUDGETING FOR TEACHING AND EXTENSION PROGRAMS

Accounting techniques of farm enterprise budgeting are rarely linked to the axioms of static production theory and to capital theory. This paper illustrates how certain linkages may be established. Particular attention is given to handling problems of scale economies, optimal output levels, replacement of durable inputs, inflation, and technological change. Estimates in an illustrative budget are linked to specific points on average cost curves. Budgeting for representative farm situations is compared to budgeting for specific situations.

Comment: Energy Accounting: The Case Of Farm Machinery In Maryland

Prior to the 1970s, energy accounting was the primary domain of physical scientists or engineers. The world of thermodynamics, rigorous concepts of energy ratios and entropy, seemed safe within their laboratories where, for example, the relative energy efficiency of solid and liquid fuels was assessed for powering an industrial heating system. This apparent orderly state of affairs—measurement primarily in controlled laboratory conditions—seemed to change abruptly in 1973 with the OPEC oil embargo. Energy accounting became the chore, if not the mission, of a myriad of scientists, engineers, businessmen, bureaucrats, and politicians. Understandably, the journals and other periodicals of our profession now abound with proposals on how to measure energy and how to employ these measures in making decisions and developing government policies.

Agriculture's Seat at Big Policy Tables

Agricultural policy in the U.S. is examined in a metaphorical context. It is likened to securing a place at a large family dinner table. Until the early 1970s effective and relatively comprehensive agricultural policy shifts could be largely effected through the “USDA dinner table,” (and its affiliates). Today, meaningful agricultural policy is crafted and implemented at a number of other big policy tables, e.g., energy and the environment, education, health and human services.

AGRICULTURAL ECONOMICS RESEARCH AND THE EXPERIMENT STATION SYSTEM

This paper discusses the role of agricultural economics research within the land-grant university system. Fundamental differences between research in the biological sciences and the social sciences are delineated. Implications of these differences for experiment station research programs are discussed. Recommendations are made which have potential for enhancing the role of agricultural economics within colleges of agriculture.

MODELING THE DEMAND FOR DURABLE INPUTS: DISTRIBUTED LAGS AND CAUSALITY

Vector-autoregressive-moving-average (VARMA) modeling was used to identify distributed lag relationships among farm tractor derived demand variables and to provide a basis for formally testing the hypothesis that the price of new tractor horsepower is exogeneous to its quantity demanded. Similar causality tests were used for a number of other explanatory variables, including the interest rate, price of diesel fuel, and price of used tractors. Results indicate that several lagged variables are significant causal factors and that the dynamic nature of the demand structure cannot be ignored when explaining tractor demand.

Penson, John B., Jr., and David A. Lins. Agricultural Finance—An Introduction to Micro and Macro Concepts. Englewood Cliffs, N.J.: Prentice-Hall, 1980, 546 pp.,

Agricultural finance :an introduction to micro and macro concepts , Agricultural finance :an introduction to micro and macro concepts , مرکز فناوری اطلاعات و اطلاع رسانی کشاورزی