Marshall A. Martin

The Economics of Bt Corn: Valuing Protection from the European Corn Borer

Corn that carries a gene from the natural soil bacterium Bacillus thuringiensis kurstaki, or Bt, has given farmers a potentially powerful tool to protect against European corn borer (ECB) damage. European corn borers are responsible for losses of

Multiattribute Assessment of Alternative Cropping Systems

1–

First generation biofuels compete.

2 billion per year in the United States. This study analyzed the economic value of Bt corn under Indiana conditions. Results suggest that the value of the protection offered by Bt corn is generally lower than the current seed premiums in Indiana. The economic value of Bt corn may exceed the current premiums for farmers with higher-than-average yields or who have a 40% or greater probability of an ECB infestation.

The future of the world food system

Multiattribute rankings of seventy-two alternative midwestern cropping systems involving corn, soybeans, and alfalfa hay are analyzed from profitability and environmental quality perspectives. Environmental consequences are simulated using EPIC and GLEAMS, and profitability is based on budget analysis. Results are analyzed using an algorithm based on multiattribute decision theory. A corn-soybean rotation using low input levels and minimum tillage on high-productivity soil, and continuous corn using low input levels and minimum tillage on low-productivity soil are in the preferred set regardless of whether profits or preserving the environment is the first priority for the decision maker.

Predictors of out-of-pocket medical expenditures in low-income households

Rising petroleum prices during 2005-2008, and passage of the 2007 U.S. Energy Independence and Security Act with a renewable fuel standard of 36 billion gallons of biofuels by 2022, encouraged massive investments in U.S. ethanol plants. Consequently, corn demand increased dramatically and prices tripled. This created a strong positive correlation between petroleum, corn, and food prices resulting in an outcry from U.S. consumers and livestock producers, and food riots in several developing countries. Other factors contributed to higher grain and food prices. Economic growth, especially in Asia, and a weaker U.S. dollar encouraged U.S. grain exports. Investors shifted funds into the commoditys future markets. Higher fuel costs for food processing and transportation put upward pressure on retail food prices. From mid-2008 to mid-2009, petroleum prices fell, the U.S. dollar strengthened, and the world economy entered a serious recession with high unemployment, housing market foreclosures, collapse of the stock market, reduced global trade, and a decline in durable goods and food purchases. Agricultural commodity prices declined about 50%. Biotechnology has had modest impacts on the biofuel sector. Seed corn with traits that help control insects and weeds has been widely adopted by U.S. farmers. Genetically engineered enzymes have reduced ethanol production costs and increased conversion efficiency.

An economic analysis of non-Bt corn refuges

On entering the twenty-first century, the world agricultural and food system is undergoing remarkable change. For agribusiness to engage successfully in this emerging system, an understanding of the drivers of this change is essential. Agricultural production and processing are resource-intensive. Hence, societal desires for enhanced environmental quality, often through government regulations, constitute a key driver of change. A second key driver is the industrialization of agriculture as farming shifts from a rural lifestyle to an agribusiness sector with a supply chain mentality. Third, firms that can effectively ‘link’ the food chain and add value will benefit economically. Historically, farmers produced bulk commodities, but increasingly the market is demanding differentiated, specific-attribute products. Biotechnology is accelerating this trend. Also, agriculture is becoming increasingly knowledgeintensive with the evolution of site-specific and information-based decision systems. Ultimately, consumer food demand and global markets will determine the demand for products from livestock and crop production systems.

Some Welfare Implications of the Adoption of Mechanical Cotton Harvesters in the United States

From a sample of low-income households, out-of-pocket medical expenses are found to average about

Technological Change and Labor's Relative Share: The Mechanization of U.S. Cotton Production

25 per month. For each household, these expenses vary with annual income, type of insurance for medical care, priority of medical expenses, ethnicity, and number of ill family members. Expenses are reported for households with different socioeconomic characteristics and composition. Multiparticipation in insurance programs is shown. Fourteen percent of the survey participants say they have no insurance, public or private. Thirty-three percent participate in Medicaid.

Reconciling Agricultural Pricing, Environmental, Conservation, Energy, and Structural Concerns

Abstract Planting Bt transgenic corn in large areas of the environment may lead to European corn borer (ECB) [ Ostrinia nubilalis (Hubner)] resistance to Bt toxins. Scientists recommend planting a non-Bt corn refuge of at least 20% of total corn area in close proximity to Bt corn as part of an Insect Resistance Management (IRM) strategy. A partial budget analysis was used to estimate the costs of implementing alternative refuge configurations in the US Corn Belt. A strip configuration is the least cost method of planting a 20% non-Bt corn refuge. A block-U refuge combination is only slightly more costly.The costs are small regardless of configuration choice and it is likely that other considerations, such as potential GMO segregation requirements, will dictate choice of configuration.

Cereal grain production: Potential for Latin America

The role of technological innovation in agricultural development has been a topic of considerable interest among agricultural economists (e.g., Hayami and Ruttan). Several studies have examined the welfare consequences for society that have occurred as a result of technological change in the agricultural sector (Bieri, de Janvry, and Schmitz; Schmitz and Seckler; Martin). Although in many cases the benefits to society from technological change may be substantial, costs are often imposed on certain groups in society. The technology used in cotton production in the United States has changed dramatically since World War II. The rate of substitution of mechanical cotton harvesters for hand labor was quite rapid. In 1950 less than 10% of the cotton crop was mechanically harvested. By 1970 virtually all cotton produced in the United States was picked by machine. The socioeconomic ramifications of the adoption of this new technology have been complex and far reaching. This note focuses on only one aspect of the economic impacts of adopting mechanical cotton pickers: the potential economic welfare gains to the producers and consumers of cotton in the United States.