Mariah Tanner Ehmke

Is Hypothetical Bias a Universal Phenomenon?: A Multinational Investigation

A concern with the contingent valuation method (CVM) is the finding that hypothetical and real statements of value often differ. We test whether hypothetical bias, broadly defined, is independent of location by comparing real and hypothetical votes on a dichotomous choice referendum in China, France, Indiana, Kansas, and Niger. We find significant differences in hypothetical bias across locations and reject the hypothesis that hypothetical bias is independent of location. As opposed to the typical finding reported in the literature, subjects in Niger significantly understated their willingness-to-pay in the hypothetical referendum. (JEL Q51)

Experimental methods for environment and development economics

Many poor countries remain trapped in a cycle of poverty and environmental degradation. Understanding how people react to existing and proposed solutions most likely can be improved using the methods of experimental economics. Experiments provide researchers a method to test theory, look for patterns of behavior, testbed economic institutions and incentives, and to educate people. Herein we explore how experimental economics has been used and could be used to help guide decision making to increase prosperity without overexploiting the resource base and environmental assets needed for basic survival.

Applying Experimental Economics to Obesity in the Family Household

The objective of this study is to identify experimental economic tools that can be employed to explain the role of economic behavior in overweight and obesity in the household. We identify three economic experiments that can be used to understand how parent-child economic relationships relate to obesity. Loss aversion experiments are discussed as a tool to understand challenges some individuals face in achieving a healthy diet. Finally, testbed experiments are introduced as a means to test and understand new policies and incentives for better health at the household level.

Subsidy Incidence in Factor Markets: An Experimental Approach

Laboratory market experiments are used to estimate the incidence of a stylized subsidy in factor market negotiations with university student and agricultural professional subjects. In separate sessions with both groups, prices converged approximately four and a half tokens higher when a 20-token per-unit subsidy was paid to buyers; this equates to 44% of the predicted 10-token split. A proportional market incentive treatment clarifies this subsidy effect. Discrepancies between predicted and observed incidence are similar to previous empirical estimates of subsidy incidence in agricultural land rental markets. A behavioral anomaly as well as buyer–buyer market competition may contribute to experimental results.

Firm Efficiency and Returns-to-Scale in the Honey Bee Pollination Services Industry

Abstract While the demand for pollination services have been increasing, continued declines in honey bee, Apis mellifera L. (Hymenoptera: Apidae), colonies have put the cropping sector and the broader health of agro-ecosystems at risk. Economic factors may play a role in dwindling honey bee colony supply in the United States, but have not been extensively studied. Using data envelopment analysis (DEA), we measure technical efficiency, returns to scale, and factors influencing the efficiency of those apiaries in the northern Rocky Mountain region participating in the pollination services market. We find that, although over 25% of apiaries are technically efficient, many experience either increasing or decreasing returns to scale. Smaller apiaries (under 80 colonies) experience increasing returns to scale, but a lack of available financing may hinder them from achieving economically sustainable colony levels. Larger apiaries (over 1,000 colonies) experience decreasing returns to scale.Those beekeepers may have economic incentivizes to decrease colony numbers. Using a double bootstrap method, we find that apiary location and offfarm employment influence apiary technical efficiency. Apiaries in Wyoming are found to be more efficient than those in Utah or Montana. Further, engagement in off-farm employment increases an apiarys technical efficiency. The combined effects of efficiency gains through off-farm employment and diseconomies of scale may explain, in part, the historical decline in honey bee numbers.