J. Scott Shonkwiler

Alternative stochastic specifications of the frontier production function in the analysis of agricultural credit programs and technical efficiency

Abstract The effect of subsidized credit on the technical efficiency of traditional farmers in Southeastern Brazil is analyzed under two alternative stochastic specifications for the production frontier. It is found that the choice of stochastic specification significantly influences inferences regarding the effect of subsidized credit on measured technical efficiency.

Imports and the Supply of Winter Tomatoes: An Application of Rational Expectations

A model of the Florida tomato industry is formulated under the hypothesis that growers make production decisions as rational economic agents. This assumption implies that anticipated Mexican tomato imports as well as other economic variables are taken into account when the planting decision is made. Maximum likelihood estimation methods are used to solve the simultaneous equations model, and the implications of the models reduced form are analyzed. The empirical findings are consistent with the rational expectations hypothesis that producers respond to market information in its entirety when making acreage decisions.

Statistical Significance and Stability of the Hog Cycle

Cyclical fluctuations in prices and production have long characterized the United States hog industry. Recent evidence suggests that the length of the hog cycle has changed. In order to determine whether the change in cycle length is statistically significant, the bootstrap technique is employed to derive confidence intervals for point estimates of the hog cycle. Application of the bootstrap technique to time series models is discussed and empirical results are presented. It is concluded that the hog cycle is undergoing rather complicated changes based on cycle lengths that are calculated to be statistically different from zero.

A Model of Weekly Price Discovery for Florida Celery

Considerable attention has recently been paid (Rhodes, Tomek and Robinson) to the various alternative mechanisms for discovering prices of agricultural products. Alternative mechanisms include organized markets and auctions, individual price negotiations, group bargaining, supply-demand estimation pricing, and formula pricing. One such price discovery mechanism is currently employed by the Florida Celery Exchange, a voluntary marketing cooperative which represents all major Florida celery producers in setting prices. The role and performance of the Exchange in influencing weekly Florida celery harvesting and pricing decisions are of particular interest because the Exchanges price-fixing activities represent, at least a priori, a departure from the traditional competitive price determination process. (This abstract was borrowed from another version of this item.)

Modeling Weekly Truck Rates For Perishables

The transportation literature reveals several studies that attempt to model freight rates. These efforts are important as they provide insight into rate determinants and consequently assist firms in planning, provide input into transportation policy debates, and are of use in transportation and commodity research. In such studies, freight-rate variations typically are explained by differences in commodity types, competition from alternative modes, and distance (Perkins; Benishay and Whitaker; Binkley and Harrar; Ferguson and Glorfeld; Boles; Miklius). However, when shippers must rely on one mode to ship a very limited mix of goods to one or a few destinations, this approach is of little use in explaining rate variations. The produce industry is a case in point. (This abstract was borrowed from another version of this item.)

Disequilibrium Market Analysis: An Application to the U.S. Fed Beef Sector: Comment

In a recent Journal article, Ziemer and White (ZW) hypothesized that the U.S. market for fed beef has been in disequilibrium on a quarterly basis. To test this hypothesis, Ziemer and White specified a supply-demand system for fed beef at the slaughter level and presented two sets of results: two-stage least squares estimates before incorporation of the disequilibrium mechanism and maximum likelihood estimates incorporating disequilibrium. They indicated that the structural model was theoretically consistent with the markets operation and that the disequilibrium hypothesis was supported by the empirical results. First, we show that their supply-demand model is misspecified. Second, we show that their empirical test of market disequilibrium is inappropriate. In particular, we focus attention on their formulation of the supply equation and show why the estimated parameters of the fed beef price and placements variables are unreasonable. Next, estimates of their model are compared to a better alternative model. Then, a statistically appropriate test of the disequilibrium hypothesis is presented and contrasted to the ZW findings.

Foreign Competition and Trade Policy for the Florida Lime Industry

ports began in the mid-1970s and has focused on their potentially adverse effect on Florida prices and production. In order to evaluate the potential threat of foreign competition on Floridas lime industry and the trade policy alternatives, quantitative estimates are needed of the impact of imports on the industry. The purpose of this paper is to estimate the effects of import competition and alternative trade policies on the Florida lime industry (Andrew, DeBoon, McPherson; Freebairn and Rausser; Novakovic and Thompson; Salathe, Dobson, Peterson). The methodology involves specifying and estimating an econometric model of the Florida lime and U.S. trade sectors. A set of reduced-form equations is derived from the simultaneous equation model. The estimated multipliers are used to measure the impacts of alternative U.S. tariff and quota policies on lime imports, Florida lime production, and prices.