Marcos Gallacher

The changing structure of production: Argentine agriculture 1988-2002

The agricultural sector of many countries shows increasing farm size with corresponding decrease in farm numbers. Despite abundant research, the determinants of changes in firm numbers and size have not been clearly identified. This paper attempts to explain small firm survival in Argentine agriculture in the 1988 – 2002 period. The evidence suggests that labor market considerations, as well changing optimal size in response to production specialization are important factors affecting small-firm disappearance. In contrast, factor proportions (the K/L ratio) does not appear to have an impact on changes in firm size.

Argentine Agricultural Policy: Producer and Consumer Support. Estimates 2007-2012

This paper analyzes agricultural policy in Argentina and calculates the degree of support received by producers and consumers. We present a summary of developments in the agricultural policy environment that have occurred in the last decades in Argentina, as well as the resulting performance of the agricultural sector. The concepts of Producer Support Estimates, Consumer Support Estimates, General Services Support Estimates, Producer Nominal Assistance Coefficient and Nominal Protection Coefficient are used to analyse different dimensions of transfers occurring between agricultural producers, consumers and taxpayers in the period 2007-2012. Total transfers from producers have averaged US

The Impact of Human Capital on Firm-Level Input Use: Argentine Agriculture

11.000 million annually or 26% of total gross farm receipts. Support flowing from the public sector to producers in the form of R&D, infrastructure and other “public good” type of inputs totalize some 500 million annually.

Contract linkages and resource use in grain production: the Argentine pradera pampeana

This paper attempts to understand the linkages between human capital and input choice in agricultural firms. The hypothesis to be tested is that better educated managers choose different input combinations than managers with a lower educational level. In particular, the hypothesis is that the ratio between non-land and land input increases as education increases. Non-land inputs include fertilizers, machinery services, herbicides, animal stocks and others. An increase in the non-land/land input ratio results in increased output (and costs) per unit of land. Given the fixity of land at the aggregate level, the non-land/land input ratio is an important determinant of total sector output. Este trabajo tiene como objetivo entender los vinculos que existen entre capital humano y uso de insumos en empresas agropecuarias. La hipotesis a ser sometida a prueba es que los productores con mayor nivel de educacion eligen combinaciones de insumos distintas que las elegidas por aquellos que cuentan con un nivel de educacion mas bajo. En particular, que el ratio entre insumos de capital y el insumo tierra aumenta a medida que la educacion de los productores aumenta. Los insumos de capital incluyen fertilizantes, servicios de maquinaria, herbicidas, capital biologico (animales) y otros. Un aumento en el ratio entre insumos de capital por unidad de recurso tierra resulta en mayor producto (y costos) por unidad de tierra. Dado que a nivel agregado la tierra es un insumo fijo, el ratio entre capital y tierra es un importante determinante de la produccion total lograda. El nivel educativo de los productores, al impactar sobre la intensidad de uso de la tierra, resulta entonces un importante determinante del nivel total de produccion logrado.

Returns to Managerial Ability: Dairy Farms in Argentina

This paper analyzes contractual arrangements in barley production in the Argentine pradera pampeana region. Barley constitutes an interesting case-study: its production and marketing conditions result in some degree of vertical contracting between primary producers and processors. Vertical coordination via contracting, however, is considerably less than that observed for example in poultry or some types of vegetable and fruit production. Barley is thus an intermediate case between coordination via impersonal market transactions and that resulting from different degrees of vertical integration. The objective of the paper is to determine the impacts of contracting on decisions such as input purchasing agreements, output marketing sharing, vertical integration, risk management and the use of technical know-how. The impact of contracting arrangements on input use and technology choice is also explored. Findings include the following. First, input purchase sharing, or output marketing sharing arrangements are infrequent amongst farmers. Some evidence exists, however, of barley farmers engaging in these arrangements more than farmers producing alternative crops. The (partial) “asset-specific” nature of the barley crop may explain these differences. Second, a higher proportion of barley farmers engage in different types of vertical arrangements with input suppliers or output purchasers. Third, farmers participating in the barley vertical chain are more likely to use formal insurance instruments than farmers producing other crops. Fourth, significant differences exist in input (fertilizer and ag chemical), and technical-know how between farmers that participate and those that do not participate in vertical arrangements with input suppliers and output purchasers. Formal contracting appears, in general, to have a positive impact on all these dimensions. The paper shows that contracts between barley producers and processors are relatively simple, relying for compliance on reputation and good-will more than on the formal “written word”. Possibly, relatively low benefits from non-compliance result in this type of arrangement working well. The paper also shows, however, that private arbitration, mediation and quality inspection institutions exist in order to reduce both the probability and costs of litigation. The Camara Arbitral (in existence since 1905) is an interesting example of this type of institution.

Predicting Academic Performance

Most studies analyzing the impact of human capital in agriculture use the measure of years of schooling of the producer as a proxy for decision-making skills. An alternative measure is used in this paper. The measure was derived by “grading” decision-making and execution skills of a sample of farmers. Grades were assigned by farm advisors knowledgeable of each farm and producer characteristics. Assigned grades were then used in a production-function context in order to estimate the impact of management skills on firm-level results. A very significant impact of these skills on production efficiency and firm results was found.