Timothy A. Park

Asset specificity and vertical integration in franchising

This study empirically tests transaction cost hypotheses with the use of data on publicly-owned franchised firms. We employ measures of the proportion of company-owned outlets for the degree of integration and brand name capital for the degree of asset specificity. The results suggest that for the sampled firms the degree of asset specificity is positively related to the degree of vertical integration. Additionly, increases in the real interest rate and firm growth rates are found to be positively related with vertical integration, while increases in unanticipated growth and firm experience are negatively related with vertical integration.

Supply and Demand Factors for Organic Produce

Although the organic produce industry is growing dramatically, little is known about market structure. We estimate a system of reduced-form equations to evaluate supply and demand factors that influence equilibrium farm price and quantity in wholesale markets for organic broccoli, carrots, and lettuce. In the long run, demand factors dominate supply factors. Reduced wholesaling costs, increased margins by which organic wholesale price exceeds nonorganic price, and higher consumer income stimulate both farm price and output. Increasing the nonorganic farm price decreases equilibrium quantity of organics. Market expansion strategies should target consumers and wholesalers. Copyright 1996, Oxford University Press.

Choice of insect management portfolios by organic farmers: lessons and comparative analysis

Abstract American farmers do not always choose sustainable insect management practices, even when they can improve their farm economic and environmental conditions by doing so. Organic farmers are dependent on alternative, biology-based insect control methods and are innovative in their on-farm experimentation with new strategies. By understanding the factors that influence the insect management portfolio chosen by organic farmers, research and education programs to promote sustainable insect management practices for all farmers may be devised. A negative binomial model of the factors influencing the number of alternative insect management practices adopted is applied to survey data from American organic farmers. It is found that college-educated farmers with smaller acreages, more than half their acreage in horticultural production, and extensive experience with organic production methods, have the greatest diversity in their insect management portfolios. There is a strong indication that on a regional basis, uncertainty over institutional and infrastructure support for organic agriculture results in the adoption of more strategies. Recommendations include more support for farmer information exchanges and mentoring programs that rely on the expertise of organic farmers, and more funding for farmer-driven organic research that can be extended to all farm populations.

An Empirical Analysis of Internet Use by U.S. Farmers

The Internet may reduce constraints on a farmers ability to receive and manage information, regardless of where the farm is located or when the information is used. Using a count data estimation procedure, this study attempts to examine the key farm, operator, regional, and household characteristics that influence the number of Internet applications used by farm households. Findings indicate that educational level of the farm operator, farm size, farm diversification, off-farm income, off-farm investments, and regional location of the farm have a significant impact on the number of Internet applications used.

Farmer risk assessment for voluntary insecticide reduction

Abstract We develop a theoretical basis for voluntary reduction in insecticide use, and quantify the subjective value farmers place on reducing environmental risk. The indirect utility model is used to quantify the acceptable financial cost of eliminating one insecticide application in return for avoidance of moderate risk to the environment. The mean valuation in Illinois, Iowa, Nebraska and Ohio, USA, is

FARM-LEVEL AND MACROECONOMIC DETERMINANTS OF FARM CREDIT MIGRATION RATES

8.25 per acre. Acceptable yield loss increases with importance of environmental goods, with formal education and with farming experience. Valuation increases with total expenditure on insecticides up to

Choices of Marketing Outlets by Organic Producers: Accounting for Selectivity Effects

89 per acre. Decomposition of the Tobit model used in estimation indicates that voluntary programs should target intensification rather than extensification of participation to maximize effectiveness.

Joint estimation of contingent valuation survey responses

Logistic regression techniques for panel data are used to identify factors affecting farm credit transition probabilities. Results indicate that most farm‐specific factors do not have adequate explanatory influence on the probability of farm credit risk transition. Class upgrade probabilities are more significantly affected by changes in certain macroeconomic factors, such as economic growth signals (from changes in stock price indexes and farm real estate values) and larger money supply that relax the credit constraint. Increases in interest rates, on the other hand, negatively affect such probabilities.

Product Market Competition and Human Resource Practices: An Analysis of the Retail Food Sector

Organic farmers have traditionally relied on a variety of marketing channels, suggesting that earned organic income will depend on the farmers experience in producing and selling organic products and their comparative advantage in bargaining and marketing skills. A discrete choice model of the choice of marketing channels is developed which accounts for the role of selectivity bias. Farmers who are most likely to sell through a diversified set of outlets or to use a single outlet have increased earnings relative to farmers who overlook these marketing options. Producers with less experience gravitate toward use of a single marketing outlet while more experienced producers tend to diversify and market through all three channels. Constraints in selling organic products tends tend to have a negative effect on farm income.

Demand and Quality Uncertainty in Pecan Purchasing Decisions

Hanemanns utility difference model for the dichotomous choice contingent valuation method is modified to account for interrelationships between responses to a set of contingent valuation questions. A nonlinear seemingly unrelated regression model is presented to jointly estimate the probit models and to derive WTP from the CV responses. The model is used to test and impose restrictions derived from economic theory on the utility difference model. Mean WTP estimates for three different types of changes in the quality of California deer hunting were uniformly lower for the joint response probit model compared to a set of independent probit models.