Jorge Fernandez-Cornejo

Technology Adoption and Off-Farm Household Income: The Case of Herbicide-Tolerant Soybeans

We model the interaction of off-farm work and adoption of agricultural technologies and the impact of adopting these technologies on farm household income from on farm and off-farm sources after controlling for such interaction, and estimate the model for the case of adoption of herbicide-tolerant (HT) soybeans using a nationwide survey of soybean farms for 2000. We find that adoption of HT soybeans is positively and significantly related to off-farm household income for U.S. soybean farmers, after controlling for other factors. In addition, while on-farm household income is not significantly related to adoption, total household income increases significantly with adoption.

THE ADOPTION OF IPM TECHNIQUES BY VEGETABLE GROWERS IN FLORIDA, MICHIGAN AND TEXAS

Factors influencing the adoption of Integrated Pest Management (IPM) techniques are studied using survey data from individual vegetable producers from Florida, Michigan, and Texas. Farmers who adopt IPM tend to be less risk averse and use more managerial time on farm activities than nonadopters. Adopters are also more likely to operate large, irrigated farms and use more family labor. Locational factors and the type of crop grown are also influential in IPM adoption. The analysis uses a logit framework and introduces adopter categories first conceptualized by rural sociologists.

Dynamic Measures of Scope and Scale Economies: An Application to German Agriculture

Static concepts of multiproduct economies of scale and scope are extended into a dynamic setting within the cost of adjustment framework. Important properties of the dynamic measures are developed and the foundations of a dynamic theory of the firm generalizing static neoclassical theory are presented. Dynamic measures of scope and scale as well as shadow costs are estimated empirically for multiple-output, multiple-input German dairy farms operating under a production quota. Causes of scope economies are explored and a conceptual model to predict the evolution of the production structure of German farms is formulated.

Genetically Engineered Crops in the United States

More than 15 years after their first successful commercial introduction in the United States, genetically engineered (GE) seeds have been widely adopted by U.S. corn, soybean, and cotton farmers. Still, some questions persist regarding the potential benefits and risks of GE crops. The report finds that, although the pace of research and development (measured by the number of USDA-approved field tests) peaked in 2002, other measures show that biotech firms continue to develop new GE seed varieties at a rapid pace. Also, U.S. farmers continue to adopt GE seeds at a robust rate, and seed varieties with multiple (stacked) traits have increased at a very rapid rate. Insecticide use has decreased with the adoption of insect-resistant crops, and herbicide-tolerant crops have enabled the substitution of glyphosate for more toxic and persistent herbicides. However, overreliance on glyphosate and a reduction in the diversity of weed management practices have contributed to the evolution of glyphosate resistance in some weed species.

FARM-LEVEL EFFECTS OF ADOPTING HERBICIDE-TOLERANT SOYBEANS IN THE U.S.A.

This paper estimates the on-farm impacts of adopting herbicide-tolerant soybean on herbicide use, yields, and farm profits, using an econometric model that corrects for self-selection and simultaneity and is consistent with profit maximization. The model is estimated using nationwide farm-level survey data for 1997. Given that the use of herbicide-tolerant soybeans involves the substitution of a particular herbicide - primarily glyphosate - for other herbicides, we explicitly consider this substitution process in the model.

Issues in the Economics of Pesticide Use in Agriculture: A Review of the Empirical Evidence

In this article, we review three perspectives used to place an economic value on pesticide use in agriculture and present associated empirical results. One approach is based on calculations of the marginal productivity; a second strategy considers the expected loss to pests relative to some current or maximum yield; and a third approach, related to the second, calculates the economic effect of banning pesticides, which is effectively the value that producers and consumers place on the chemicals used. We also review the economic effects of government policies to reduce or restrict pesticide use, including regulation and pesticide taxes as well as use of alternative technologies believed to reduce pesticide use, such as integrated pest management and genetically engineered plants.

Environmental and economic consequences of technology adoption: IPM in viticulture

The impact of integrated pest management (IPM) on pesticide use, toxicity and other environmental characteristics, yields, and farm profits is examined for grape growers. The method is generally applicable for technology adoption and accounts for self-selectivity, simultaneity, and theoretical consistency. IPM adopters apply significantly less insecticides and fungicides than nonadopters among grape producers in six states, accounting for most of the U.S. production. Both the average toxicity and the Environmental Impact Quotient decrease slightly with adoption of insect IPM, but remain about the same for adopters and nonadopters of IPM for diseases. The effect of IPM adoption on yields and variable profits is positive but only significant for the case of IPM for diseases, i.e., the adoption of IPM for diseases increases yields and profits significantly. Published by Elsevier Science B.V.

Quality-Adjusted Price and Quantity Indices for Pesticides

Quality-adjusted price indices are calculated for pesticides used on major crops in U.S. agriculture for 1967–92 using hedonic methods. Pesticide potency, hazardous characteristics, and persistence in the environment are used as quality characteristics. Separate hedonic functions are estimated for pesticides by end-use (crop) and major pesticide class. Price indices are aggregated using chained Tornqvist indices. Adjusted quantity indices are computed using pesticide expenditures. The adjusted price index rose steadily, reaching in 1992 around 2.5 times the level of 1968. Pesticide use at constant quality peaked in 1981 at a level substantially higher than the peak reached by the unadjusted index.

Economic and policy issues of U.S. agricultural pesticide use trends

BACKGROUND This paper discusses U.S. agricultural pesticide use trends from 1964 to 2010 based on estimates developed from USDA surveys, and the influence of economic factors, agricultural policy, and pesticide regulation on aggregate quantities and mix of pesticides used. RESULTS Synthetic organic pesticide use grew dramatically from the 1960s to the early 1980s, as farmers treated more and more acreage. Use then stabilized, with herbicides applied to about 95% of corn, cotton, and soybean acres, annually. Subsequently, major factors affecting trends were: (1) changes in crop acreage and other economic factors, (2) use of new pesticides that reduced per-acre application rates and/or met more rigorous health and environmental standards, and (3) adoption of genetically engineered insect-resistant and herbicide-tolerant crops. CONCLUSION The use of pesticides and other control practices responded to economic factors such as input and output markets and agricultural policies. Changing societal values toward pesticide risks and benefits profoundly affected pesticide policy, influencing the pesticides available for use, but only indirectly affecting aggregate quantities used. While the current pesticide regulatory process might have economic inefficiencies, it might be consistent with policy preferences held by much of the public-to reduce pesticide hazards rather than minimize regulatory costs.

Research and Productivity in Mexican Agriculture

Partial and total factor productivity (TFP) measures of Mexican agriculture are calculated for 1960–90. The long-run effects of research and international transfer of technology on TFP are examined over the 1940-90 period using cointegration procedures. TFP increased at an average annual rate of 2.5%, exceeding the corresponding growth in the United States (2.1%). TFP grew particularly fast in the 1960s and 1970s. A 1% rise in research investment increased TFP by 0.13%, and a 1% increase in U.S. TFP translated into a 1.11% increase in Mexican TFP. The average annual rate of return to research investment is about 64%. Copyright 1997, Oxford University Press.