John Miranowski

Understanding Farmland Price Changes

This paper develops a structural model of land prices which includes the multidimensional effects of inflation on capital-erosion, savings-return erosion, and real debt reduction as well as the effect of changes in the opportunity cost of capital. The results show that inflation and changes in the real returns on capital are major explanatory factors in farmland price swings in addition to returns to farming. Additionally, the effects of credit market constraints and expectations schemes are considered explicitly in the analytical model.

Implicit Prices of Soil Characteristics for Farmland in Iowa

Arguments have long persisted that purchasers pay too much for poor land (i.e., less productive, more erosive) relative to the higher quality counterpart. In other words, purchasers are either irrational or poorly informed relative to the differences in land productivity between poor and good farmland. Similar arguments have been advanced concerning the willingness-to-pay rent on the part of tenant operators. Little empirical evidence exists to support or reject this hypothesis. Farmland appraisals are sometimes cited as evidence to support the contention, but such empiricism may indicate more about the quality and biases of appraisers than about the behavior or efficient functioning of the farmland market. Resolution of this issue is extremely important to the formation of soil conservation policy designed to protect soil productivity. Irrational behavior on the part of land purchasers may lead one to infer that the market system is failing to recognize adequately the soil productivity consequences of soil erosion. If this oversight consistently leads to excessive soil erosion from societys perspective, then some form of government intervention may be necessary to protect the welfare of society, assuming that such intervention is capable of correcting the market failure.

Estimating the implicit price of energy efficiency improvements in the residential housing market: A hedonic approach

Abstract In this study a hedonic price model has been used to examine the impact which efficiency improvements have on housing values. Our study represents an improvement over a previous attempt to examine this issue in that the independent variable used in our analysis is designed to reflect variation in structural efficiency levels among sample homes, rather than variation in occupant lifestyles and preferences. In addition, a flexible functional form is used to prevent bias due to misspecification of the hedonic price equation. The study results reveal that efficiency improvements are capitalized into housing prices in Des Moines, Iowa. At the average efficiency level of homes in the sample, an efficiency improvement which results in a

Leadership and the Provision of Safe Food

1 decrease in the level of expenditures necessary to maintain the house at 65 ° F (in the average heating season) will increase the expected selling price of the house by

Impacts of Productivity Loss on Crop Production and Management in a Dynamic Economic Model

11.63. The premium obtained for an equivalent efficiency improvement will be greater than

Dynamic Corn Supply Functions: A Model with Explicit Optimization

11.63 in a relatively efficient home, and less than

An Indirect Test for the Specification of Expectation Regimes

11.63 in a relatively inefficient home. Without further information concerning the price expectations and discount rates utilized by Des Moines home buyers, and the average remaining life of fuels saving investments in the sample, it cannot be determined whether the housing market is pricing fuel savings efficiently. Regardless of whether or not the implicit price of fuel savings is the outcome of an efficient market, information on this implicit price facilitates the estimation of an average resale value of fuel saving investments. In addition, the results of this study refute the hypothesis that efficiency improving investments are not capitalized into housing prices.

An Economic Analysis of Expenditures on Agricultural Experiment Station Research

Modern food production typically involves many interacting stages and two or more decision makers. There is reason to believe that inputs in determining quality likely complement. And it is not possible to regulate many of these inputs. In a food production system possessing these characteristics, we show that leadership by one or more firms through communicating actions may be used as a mechanism to increase overall food quality. As there may be no private incentive to lead, there may be strategic merit in assigning liability through legislation. We also suggest the possibility that genetics are leadership instruments in hog production systems.

The Effects of Commodity Programs on Resource Use

This article finds the optimal choice of tillage method and crop rotation for farmers who correctly anticipate the yield-decreasing effects of soil erosion. Expected increases in crop prices lead to farming practices that are more conservation oriented. Higher relative prices for hay also lead to more soil conservation. A linear programming model of soil loss is presented for a watershed in Tama County, Iowa.

Inference Based on Alternative Bootstrapping Methods in Spatial Models with an Application to County Income Growth in the United States

A model of optimal dynamic agricultural supply is derived and fitted assuming farmers have two annual stochastic crop production activities, a joint limitation on production capacity, interdependencies between past acreage utilization and current productivity, and rational expectations. A five-equation specification is fitted to annual data, 1948–80. Estimated parameters are consistent with the theory, and the model simulates well. The long-run price elasticity of corn acreage is 0.2, which is similar to those obtained from ad hoc dynamic models, but our short-run elasticities are different.