Steven E. Sexton

The Economics of Pesticides and Pest Control

Pesticides have been a major contributor to the growth of agricultural productivity and food supply. Yet, they are a source of concern because of human and environmental health side effects. This paper presents methodologies for assessing the productivity and health effects of pesticides. It also provides an overview of some of the major empirical findings. This paper covers major research that analyzes alternative approaches to address issues of resistance buildup, risk and environmental and human health, predator–prey relationships, as well as dynamic considerations. The paper summarizes existing policies that vary from the prescribed social optimum suggested by economic theory to those motivated by political–economy factors and risk aversion. Analysis is provided to relate pesticide policies to the larger context of agricultural and environmental management. This paper also presents recent modeling of invasive species and agricultural biotechnology.

Sustainability of food, energy and environment with biofuels

Growing reliance on food-based biofuels has created considerable controversy about its impact on food prices and the environment and led to scepticism about its sustainability. This review describes the concept of sustainability in the context of biofuels and then discusses the factors affecting the economic viability of current and next-generation biofuels and their environmental and social sustainability. Cellulosic biofuels from dedicated energy crops offer considerable promise for reducing the competition for land and avoiding many of the negative environmental impacts associated with corn-ethanol. But the production of any type of biofuel is likely to involve trade-offs among the multi-dimensional aspects of sustainability. Technological innovation and policy incentives are needed to develop more sustainable biofuels and to guide the mix of feedstocks, their methods and locations of production.

Automatic Bill Payment and Salience Effects: Evidence from Electricity Consumption

The introduction of automatic bill payment (ABP) programs in 2005 eliminated the need for consumers to view recurring bills. If those enrolled in ABP programs offered by utilities and other service providers forgo inspection of their recurring bills, then price salience declines, prices perceived by boundedly rational agents fall, and consumption increases. This paper considers the impact of such programs on consumer demand and welfare and empirically tests whether enrollment in such programs increases demand. Results show ABP enrollment increases residential electricity consumption by 4.0% and commercial electricity consumption by as much as 8.1%. Enrollment in programs designed to smooth seasonal variation in monthly utility bills of low-income customers results in 6.7% greater electricity use.

Beyond the 'food or biofuel' dilemma.

1Department of Agricultural and Resource Economics, 3301 Giannini Hall, University of California, Berkeley, CA 94720, USA †Author for correspondence: E-mail: ssexton@berkeley.edu High agricultural commodity prices threatened global food security at the outset of 2011 for the second time in just 3 years. Rising food prices and the dire impacts they portend for the world’s poor have reignited criticisms of government biofuel policies that were blamed in 2008 for diverting precious farmland and harvest to production of an alternative energy with disputed environmental benefits. Increasing oil scarcity and the food production demands imposed by a world population increasing in size and wealth have spurred Malthusian worries about the capacity of agriculture to meet these demands without forsaking the environment. The challenge to agriculture is significant: produce food and fuel for a world that is growing hungrier for both, and do it with less land and less carbon. It would seem an impossible task but for the success of the Green Revolution in the last century and the promise of transgenic seed technologies in this century. The adoption of genetically engineered seeds is well-documented to boost farm yields for a variety of crops around the world, including soybeans and maize, two staple crops that double as feedstocks for biofuels [1,2]. The technology has the capacity to diminish the food-versus-fuel tradeoff, but regulation constrains the magnitude of its benefits and imperils its future. Advocates for the world’s poor may be right to criticize Western governments for food insecurity, but they may have targeted the wrong set of policies: prevailing evidence suggests that if the potential of agricultural biotechnology is unleashed, then more food can be produced on each farm, making room for biofuels on existing cropland. For three decades until 2008, the world knew only declining food prices. This bred complacency towards agricultural productivity growth. In the half century from approximately 1940 to 1990, per capita food production increased, in spite of a doubling of the world population from 3 to 6 billion. Such gains were made without a concomitant increase in agricultural land. In fact, total cropland declined as productivity gains from mechanization, modern irrigation technologies, agrochemicals and conventional plant breeding led to a doubling of staple crop yields [3]. Another doubling of crop yields in the next 50 years would make room for enough biofuels to displace considerable gasoline consumption. In the 1990s, however, crop science R&D began to decline [4], and with it, the rate of yield growth slowed as gains from innovations during the previous half century were exhausted. Since 1990, agricultural productivity growth has been half as fast as it was in the preceding 20 years. From 1990 to 2007, yield growth

Food safety, the environment, and trade.

In this paper, the authors discuss the ways in which national governments, firms, and individuals respond to policy related to food safety, environmental protection, and trade. These responses must be considered in the development of policy to ensure the best possible outcomes. It accounts for uncertainty about policy impacts and scientific knowledge and incorporates stochastic environmental factors. The authors argue use of such a model in the development of health and environmental policy can overcome capture by domestic forces opposed to trade liberalization. The effectiveness of policy, of course, is dependent upon firm and consumer response to policy. Section one describes the impacts of international transfer of species and genetic material, paying particular attention to the introduction of alien invasive species. Section two discusses issues surrounding trade in environmental amenities. Food safety and environmental regulations are reviewed in section three, along with mechanisms by which such policy can serve as a proxy for protectionists. Section four develops a risk assessment model that can be used in policy design. Section five considers the role of institutional, firm and individual behavior in the development and effectiveness of policy. Section six summarizes our analysis in offering an agenda for trade talks.