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NEP: New Economics Papers
Agricultural Economics
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Edited by: Angelo Zago
Universita degli Studi di Verona
Date: 2005-04-24
Papers: 20
This document is in the public domain, feel free to circulate it.
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In this issue we have:
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1. The Effect of Pollution Permit Allocations on Firm-Level
Emissions
Meredith Fowlie; Jeffrey Perloff
2. We Should Drink No Wine Before Its Time
Rachel Goodhue; Jeffrey LaFrance; Leo Simon
3. Measuring Transactions Costs from Observed Behavior: Market
Choices in Peru
Renos Vakis; Elisabeth Sadoulet; Alain de Janvry
4. A Tale of Two Communities: Explaining Deforestation in Mexico
Jennifer Alix-Garcia; Alain de Janvry; Elisabeth Sadoulet
5. The Impact of Farmer-Field-Schools on Knowledge and
Productivity: A Study of Potato Farmers in the Peruvian Andes
Erin Godtland; Elisabeth Sadoulet; Alain de Janvry; Rinku
Murgai; Oscar Ortiz
6. Government Policy Effects on Urban and Rural Income Inequality
Ximing Wu; Jeffrey Perloff; Amos Golan
7. Creating Incentives for Micro-Credit Agents to Lend to the
Poor
Cecile Aubert; Alain de Janvry; Elisabeth Sadoulet
8. Testing for Separability in Household Models with
Heterogeneous Behavior: A Mixture Model Approach
Renos Vakis; Elisabeth Sadoulet; Alain de Janvry; Carlo
Cafiero
9. Peer Effects in Employment: Results from Mexico's Poor Rural
Communities
Caridad Araujo; Alain de Janvry; Elisabeth Sadoulet
10. The GMO Dispute before the WTO: Legal Implications for the
Trade and Environment Debate
Francesco Sindico
11. Use of Ecolabels in Promoting Exports from Developing
Countries to Developed Countries: Lessons from the Indian
LeatherFootwear Industry
Parashar Kulkarni
12. Decentralization and Environment: An Application to Water
Policies
Maria Angeles Garcia-Vali?as
13. Combining Actual and Contingent Behavior to Estimate the
Value of Sports Fishing in the Lagoon of Venice
Anna Alberini; Valentina Zanatta; Paolo Rosato
14. Environmental Regulationand the Eco-Industry
Bernard Sinclair-Desgagn?; Maia David
15. Household Access to Microcredit and Child Work in Rural
Malawi
Gautam Hazarika; Sudipta Sarangi
16. Poverty Nutrition Trap in Rural India
Raghbendra Jha; Raghav Gaiha; Anurag Sharma
17. FOOD POLICY AND POVERTY IN INDONESIA: A GENERAL EQUILIBRIUM
ANALYSIS
Peter Warr
18. Roads and Poverty in Rural Laos
Peter Warr
19. UK Sugar Beet Farm Productivity under Different Reform
Scenarios: A Farm Level Analysis
Alan W. Renwick; Cesar L. Revoredo Giha; Mark A. Reader
20. Analysis of the Impact on UK Sugar Production Efficiency of
Reforming the EU Sugar Regime
Alan W. Renwick; Cesar L. Revoredo Giha
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1. The Effect of Pollution Permit Allocations on Firm-Level
Emissions
Meredith Fowlie (University of California, Berkeley)
Jeffrey Perloff (University of California, Berkeley, and
Giannini Foundation)
According to the Coase theorem, if property rights to pollute
are clearly established and emissions markets nearly eliminate
transaction costs, the market equilibrium will be independent of
how the permits are initially allocated across firms. Using panel
data from Southern California's RECLAIM program, we find that
initial allocations are a statistically significant determinant
of firm-level emissions. This relationship between allocation and
emissions is stronger among firms with relatively high
transaction costs. Thus, care must be exercised in the initial
allocation of permits to ensure efficiency.
Keywords: emissions trading, transaction costs,
Date: 2004-02-01
URL: http://d.repec.org/n?u=RePEc:cdl:agrebk:1047&r=agr
2. We Should Drink No Wine Before Its Time
Rachel Goodhue (University of California, Davis)
Jeffrey LaFrance (University of California, Berkeley)
Leo Simon (University of California, Berkeley)
We consider the impact of taxes on the quantity and quality
produced of goods whose market values accrue with age. The
analysis is motivated by the high and increasing taxation rates
in the wine industry across the globe. If society values both
quality and quantity as goods, an optimal tax system would never
reduce the quality marketed, though it necessarily reduces
quantity. Any two-tax system that includes a volumetric sales tax
and any one of three other types of tax - an ad valorem sales tax,
an ad valorem storage tax, or a volumetric storage tax - spans
the quality/revenue space and can support an optimal tax system.
Any tax system that reduces quality relative to the market
equilibrium with no taxes could increase tax revenues and reduce
the quality distortion without increasing the quantity distortion.
Given this, the only explanation for taxation schemes that
reduce both the quantity and quality of goods like wine must be a
Calvinistic social welfare function.
Keywords: stochastic models, taxation, wine industry, wines,
Date: 2004-02-01
URL: http://d.repec.org/n?u=RePEc:cdl:agrebk:1058&r=agr
3. Measuring Transactions Costs from Observed Behavior: Market
Choices in Peru
Renos Vakis (World Bank)
Elisabeth Sadoulet (University of California, Berkeley)
Alain de Janvry (University of California, Berkeley)
Farmers incur proportional and fixed transactions costs in
selling their crops on markets. Using data for Peruvian potato
farmers, we propose a method to measure these transactions costs.
When opportunities exist to sell a crop on alternative markets,
the observed choice of market can be used to infer a monetary
measure of transactions costs in market participation. The market
choice model is first estimated at the reduced form level with a
conditional logit, as a function of variables that explain
transactions costs. We then use these market choice equations to
control for selection in predicting the idiosyncratic prices that
would be received on all markets and the idiosyncratic
proportional transactions costs that would be incurred to reach
all markets. The net between the two gives us a measure of
effective farm-level prices. This allows us to estimate a semi-
structural conditional logit of the market choice model. In this
model, the choice of market is a function of predicted effective
farm-level prices, and of market information that accounts for
fixed transactions costs. We can use the estimated coefficients
to derive the price equivalence of the fixed cost due to
information. We find that the information on market price that
farmers receive from their neighbors reduces fixed transactions
costs by the equivalent of doubling the price received, and is
equal to four times the average transportation cost.
Keywords: transactions costs, market choice, information,
Date: 2003-10-01
URL: http://d.repec.org/n?u=RePEc:cdl:agrebk:1059&r=agr
4. A Tale of Two Communities: Explaining Deforestation in Mexico
Jennifer Alix-Garcia (University of California, Berkeley)
Alain de Janvry (University of California, Berkeley)
Elisabeth Sadoulet (University of California, Berkeley)
Explaining land use change in Mexico requires understanding the
behavior of the local institutions involved. We develop two
theories to explain deforestation in communities with and without
forestry projects, where the former involves a process of side
payments to non-members of the community and the latter of
partial cooperation among community members. Data collected in
2002 combined with satellite imagery are used to test these
theories. For the forestry villages, we establish a positive
relationship between the distribution of profits as dividends
instead of public goods and forest loss. For communities not
engaged in forestry projects, deforestation is largely related to
the ability of the community to induce the formation of a
coalition of members that cooperates in not encroaching. This
happens more easily in smaller communities with experienced
leaders. A disturbing result of the analysis is that
deforestation is higher when a community engages in forestry
projects, even after properly accounting for self-selection into
this activity. This suggests that forestry projects as they now
exist in Mexico are not sustainable and contribute to the
deforestation problem.
Keywords: deforestation, common property, partial cooperation,
Date: 2003-11-07
URL: http://d.repec.org/n?u=RePEc:cdl:agrebk:1060&r=agr
5. The Impact of Farmer-Field-Schools on Knowledge and
Productivity: A Study of Potato Farmers in the Peruvian Andes
Erin Godtland (U.S. General Accounting Office)
Elisabeth Sadoulet (University of California, Berkeley)
Alain de Janvry (University of California, Berkeley)
Rinku Murgai (Development Economics Research Group, The
World Bank)
Oscar Ortiz (International Potato Center, Consultative Group
on Agricultural Research)
Using survey-data from Peru, this paper evaluates the impact of
a pilot farmer-field-school (FFS) program on farmers' knowledge
of integrated pest management(IPM) practices related to potato
cultivation. We use both regression analysis controlling for
participation and a propensity score matching approach to create
a comparison group similar to the FFS participants in observable
characteristics. Results are robust across the two approaches as
well as with different matching methods. We find that farmers who
participate in the program have significantly more knowledge
about IPM practices than those in the non-participant comparison
group. We also find that improved knowledge about IPM practices
has a significant impact on productivity in potato production.
Keywords: agricultural innovations, agricultural productivity,
integrated pest management, potato cultivation,
Date: 2003-11-01
URL: http://d.repec.org/n?u=RePEc:cdl:agrebk:1061&r=agr
6. Government Policy Effects on Urban and Rural Income Inequality
Ximing Wu (University of Guelph)
Jeffrey Perloff (University of California, Berkeley, and
Giannini Foundation)
Amos Golan (American University)
Keywords: income distribution, inequality, public policy,
welfare,
Date: 2004-02-01
URL: http://d.repec.org/n?u=RePEc:cdl:agrebk:1065&r=agr
7. Creating Incentives for Micro-Credit Agents to Lend to the
Poor
Cecile Aubert (Universite Paris Dauphine)
Alain de Janvry (University of California, Berkeley)
Elisabeth Sadoulet (University of California, Berkeley)
Microfinance institutions (MFIs) have introduced incentive pay
schemes for their credit agents to induce information acquisition
on borrowers. Bonuses linked to repayment are efficient for
profit-oriented MFIs but insufficient for non-profit MFIs trying
to reach very poor borrowers, when repayment and wealth are
positively correlated. We show that no incentive scheme is
consistent with this (non-verifiable) objective: Random audits on
the share of very poor borrowers selected by the agent become
necessary. Under the optimal contract, non-profit MFIs generally
maximize the number of poor borrowers it services by cross-
subsidization between very poor and less poor borrowers.
Keywords: micro-credit, pro-poor objectives, incentives,
Date: 2004-06-01
URL: http://d.repec.org/n?u=RePEc:cdl:agrebk:1077&r=agr
8. Testing for Separability in Household Models with
Heterogeneous Behavior: A Mixture Model Approach
Renos Vakis (World Bank)
Elisabeth Sadoulet (University of California, Berkeley)
Alain de Janvry (University of California, Berkeley)
Carlo Cafiero (Universita degli Studi di Napoli Federico II)
Knowing whether a household behaves according to separability or
non-separability is needed for the correct modeling of production
decisions. We propose a superior test to those found in the
literature on separability by using a mixture distribution
approach to estimate the probability that a farm household
behaves according to non-separability, and test that the
determinants of consumption affect production decisions for
households categorized as non-separable. With non-separability
attributed to labor market constraints, the switcher equation
shows that Peruvian farm households that are indigenous and young,
with low levels of education, and lack of local employment
opportunities are more likely to be constrained on the labor
market.
Keywords: labor, separability, mixture distributions, Peru,
Date: 2004-08-01
URL: http://d.repec.org/n?u=RePEc:cdl:agrebk:1079&r=agr
9. Peer Effects in Employment: Results from Mexico's Poor Rural
Communities
Caridad Araujo (The World Bank and Georgetown University)
Alain de Janvry (University of California, Berkeley)
Elisabeth Sadoulet (University of California, Berkeley)
Empirical evidence has shown that off-farm non-agricultural (
OFNA) employment offers a major pathway from poverty for rural
populations. However, the pattern of participation in these
activities is heterogeneous across categories of individuals and
poorly understood. We explore the role of spillovers from peers
on an individual's participation in formal and informal OFNA
employment using village census data for rural Mexico. We test
and reject the possibility that peers' decisions could be
proxying for unobserved individual, village-level, or individual-
type effects. We find that peers' participation in OFNA
employment has a large impact on an individual's ability to
engage in this type of employment, both formal and informal, even
after controlling for individual attributes and village
characteristics. Peer effects are structured by similarities in
gender, ethnicity, educational level, and land endowment. We find
that marginal peer effects tend to be stronger for categories of
individuals that are already more engaged in OFNA employment,
such as men, non-indigenous people, the more educated, and the
landless, contributing to reinforcing inequalities in accessing
these jobs. However, the role of peer effects relative to that of
education in obtaining formal OFNA employment is more important
for members of groups that are less engaged in these jobs, such
as women, indigenous people, the less educated, and smallholders.
Keywords: off-farm employment, rural poverty, social aspects,
Date: 2004-08-01
URL: http://d.repec.org/n?u=RePEc:cdl:agrebk:1080&r=agr
10. The GMO Dispute before the WTO: Legal Implications for the
Trade and Environment Debate
Francesco Sindico (Universitat Jaume I)
USA, Canada and Argentina have challenged before the World Trade
Organisation the European Communities? (EC) denial of
Genetically Modified (GM) product imports, which took place from
1998 to 2004 . Against this background, the goal of this paper is
twofold. Firstly, we will determine which WTO provisions would
have been violated by the EC. Secondly, we will highlight the
dispute?s most important legal issues in order to see to what
extent the dispute might influence the ongoing trade and
environment debate. The paper concludes that the role of the
precautionary principle in the application of the EC legislation
is one of the dispute?s main issues. Furthermore, the Panel
findings on the legal nature of the precautionary principle, and
on its relevance for the interpretation of WTO provisions, will
finally determine the influence of the GMO dispute on the trade
and environment debate.
Keywords: GMO, WTO, Trade, Environment
JEL: Q00 F10
Date: 2005-01
URL: http://d.repec.org/n?u=RePEc:fem:femwpa:2005.11&r=agr
11. Use of Ecolabels in Promoting Exports from Developing
Countries to Developed Countries: Lessons from the Indian
LeatherFootwear Industry
Parashar Kulkarni (CUTS Centre for International Trade,
Economics & Environment)
This paper tries to understand whether importers in the North
are able to push exporters in the South towards sustainable
production, with the help of a case study of the Indian leather
industry. After providing a short description of the global
leather footwear industry, the first section provides insights
into the competitive advantages of different countries,
characteristics of developing country exporters and the
difference between large and small European buyers of Indian
leather footwear. The subsequent section provides an insight into
the different chains of influence that exist in trying to make
international trade more sustainable with the help of a broad
understanding of the means, their effectiveness, their
constraints and a few examples of such chains of influence.
Section four studies whether ecolabels are in a position to be
suitable indicators of sustainability. Further it delves into
understanding the perspectives of consumers, producers and
regulators on whether ecolabels are useful in promoting
sustainable exports. The explanation of how ecolabels conflict
with brand dynamics is quite interesting. The policy measures
provide clear options for targeting sustainable production.
Suggestions include use of eco-elasticity indicator, toolbox
approach to environment policy, introducing comprehensive
sustainability labels, maintaining a level of mandatory
legislations as well as a constructive effort to increase
transparency in supply chains. The annexure include the research
methodology adopted for the paper, the reason for choosing Europe
as destination for the research, a brief overview about types of
ecolabels and a small description of integrated product policies.
Keywords: Ecolabels, Export promotion, Leather footwear, Market
access
JEL: F18
Date: 2005-01
URL: http://d.repec.org/n?u=RePEc:fem:femwpa:2005.15&r=agr
12. Decentralization and Environment: An Application to Water
Policies
Maria Angeles Garcia-Vali?as (University of Oviedo)
By means of a two-jurisdictional model, this paper analyses the
optimal division of environmental policymaking functions among
the different government levels, identifying the most appropriate
level of decentralization in each case. The paper focuses on
water resources policies, with an application to Spanish regions
during the 1996-2001 period. The estimation of an environmental
quality-consumption transformation function allows the
implementation of a simulation to find the most efficient
policies in the context of water resources.
Keywords: Fiscal federalism, Environmental policies, Water
resources
JEL: H77 Q25 Q28
Date: 2005-02
URL: http://d.repec.org/n?u=RePEc:fem:femwpa:2005.31&r=agr
13. Combining Actual and Contingent Behavior to Estimate the
Value of Sports Fishing in the Lagoon of Venice
Anna Alberini (University of Maryland)
Valentina Zanatta (DICAS, Politecnico di Torino and
Fondazione Eni Enrico Mattei)
Paolo Rosato (DIC, Universit? di Trieste and Fondazione Eni
Enrico Mattei)
This paper reports the results of a Travel Cost Method (TCM)
study about the recreational use of the Lagoon of Venice for
sports fishing. In April-July 2002, we conducted a mail survey of
anglers with valid licenses fishing on the Lagoon of Venice to
gather data on their fishing trips, behaviors and expenditures
over the previous year. We also asked questions about trips that
would be undertaken under hypothetical changes in the price of a
trip and/or in the catch rate. Actual and hypothetical trips are
combined to estimate single-site TCM demand function for trips.
We propose several models to test whether it is acceptable to
pool hypothetical and actual trip data, focusing on the
respondent heterogeneity in the contingent behavior questions.
Our models suggest actual and contingent behavior are driven by
the same demand function, and can be pooled for estimation
purposes. We use this estimated demand function, and its shift
when the catch rate is improved, to compute angler surplus at the
current catch rate and the change in surplus accruing from a 50%
improvement in the catch rate. For the average angler in our
sample, the former is about ?1,700 a year, while the latter is
about ?2,800.
Keywords: Sports fishing value, Travel cost method,
Environmental improvement
JEL: Q26 Q51
Date: 2005-03
URL: http://d.repec.org/n?u=RePEc:fem:femwpa:2005.44&r=agr
14. Environmental Regulationand the Eco-Industry
Bernard Sinclair-Desgagn? (HEC Montr?al)
Maia David (UMR INRA-INAPG ?conomie publique)
This paper re-examines environmental regulation, under the
assumption that pollution abatement technologies and services are
provided by an imperfectly competitive environment industry. It
is shown that each regulatory instrument (emission taxes and
quotas; design standards; and voluntary agreements) has a
specific impact on the price-elasticity of the polluters?
demand for abatement services, hence on the market power of the
eco-industry and the resulting cost of abatement. This implies
that the optimal pollution tax will be higher than the marginal
social cost of pollution, while a voluntary approach to pollution
abatement may fail unless the eco-industry itself is willing to
participate.
Keywords: Pollution regulation, End-of-pipe pollution abatement,
Environment industry
JEL: H23 L13 Q58
Date: 2005-04
URL: http://d.repec.org/n?u=RePEc:fem:femwpa:2005.56&r=agr
15. Household Access to Microcredit and Child Work in Rural
Malawi
Gautam Hazarika (University of Texas at Brownsville and IZA
Bonn)
Sudipta Sarangi (Louisiana State University)
This paper examines the effect of household access to
microcredit upon work by seven to eleven year old children in
rural Malawi. Given that microcredit organizations foster
household enterprises wherein much child labor is engaged, this
paper aims to discover whether access to microcredit might
increase work by children. It is found that household access to
microcredit, measured in a novel manner as self-assessed credit
limits at microcredit organizations, raises the probability of
child work in households with sample mean values of land
ownership and number of retail sales enterprises. It appears this
is due to children having to take up more domestic chores as
adults are busied in household enterprises following improved
access to microcredit.
Keywords: child labor, microcredit
JEL: J22
Date: 2005-04
URL: http://d.repec.org/n?u=RePEc:iza:izadps:dp1567&r=agr
16. Poverty Nutrition Trap in Rural India
Raghbendra Jha
Raghav Gaiha
Anurag Sharma
The contribution of the present paper is threefold. First, we
formally test whether the effect of calorie deprivation on wages
is more significant/higher for the lower quantiles of workers. In
the extant literature this is established through non-linear
terms in the wage equation. A more satisfactory method of doing
this is through quantile regressions. Second, the quantile
regression approach helps us identify the exact group for which
the poverty-nutrition trap holds. The extant literature is unable
to establish whether there are systematic differences across
different quintiles in the response of productivity/wages to
nutrition. The present paper addresses this lacuna. Third, we are
able to establish a critical wage level for which the PNT trap
hypothesis holds. For wages higher than this the hypothesis does
not hold. We then argue that this value of the wage rate should
set a floor for any minimum wage for agricultural labourers.
Keywords: nutrition, calories, wages, poverty trap, labourers
Length (pages): 33
JEL: I I I J
Date: 2005-02
URL: http://d.repec.org/n?u=RePEc:pas:papers:2005-02&r=agr
17. FOOD POLICY AND POVERTY IN INDONESIA: A GENERAL EQUILIBRIUM
ANALYSIS
Peter Warr
Indonesia is the world?s largest importer of its staple food,
rice. Since the economic crisis of 1998, rice import policy has
become increasingly protectionist and since early 2004, imports
have been banned. This paper uses a general equilibrium model of
the Indonesian economy to analyze the effects of an import ban on
rice, including its effects on poverty. The analysis recognizes 1,
000 individual households. The results indicate that the rice
import ban raises poverty incidence by a little less than one per
cent of the population. Poverty rises in both rural and urban
areas. Among farmers, only the richest gain.
Keywords: poverty; general equilibrium; rice imports; trade
policy. Length (pages): 36
JEL: Q18 F13 C68 O53
Date: 2005-03
URL: http://d.repec.org/n?u=RePEc:pas:papers:2005-03&r=agr
18. Roads and Poverty in Rural Laos
Peter Warr
The relationship between poverty incidence and road development
is analyzed in this paper, in the context of rural Laos. The
results indicate that improving road access is an effective way
of reducing rural poverty. Between 1997-98 and 2002-03, rural
poverty incidence in Laos declined by 9.5 per cent. The results
suggest that about 13 per cent of this decline can be attributed
to improved road access to areas already having dry season access.
There is now a high return to providing dry weather access to
the most isolated households of Laos ? those with no road
access at all.
Keywords: poverty incidence; rural roads; Lao PDR. Length (pages)
34
JEL: H53 I32 O53 R41
Date: 2005-04
URL: http://d.repec.org/n?u=RePEc:pas:papers:2005-04&r=agr
19. UK Sugar Beet Farm Productivity under Different Reform
Scenarios: A Farm Level Analysis
Alan W. Renwick (Land Economy Research Group, Scottish
Agricultural College, UK)
Cesar L. Revoredo Giha (Department of Land Economy,
University of Cambridge)
Mark A. Reader (Department of Land Economy, University of
Cambridge)
The purpose of this paper is to study the effect that the
imminent reform in the European Union (EU) sugar regime may have
on farm productivity in the United Kingdom (UK). We perform the
analysis on a sample of sugar beet farms representative of all
the UK sugar beet regions. To estimate the changes in
productivity, we estimate a multi-output cost function
representing the cropping part of the farm, which is the
component that would be mostly affected by the sugar beet reform.
We use this cost function to compute the new allocation of
outputs and inputs after the changes in the sugar beet quota and
price support. This are subsequently used to compute measures of
total factor productivity. Our results show slight decreases in
the productivity at the individual farm level under both quota
and price support reduction. However, when considering the
aggregate level, the reduction in the price support shows
significant increases in productivity, in contrast to the results
obtained from a reduction in quota.
Keywords: EU sugar reform; UK agriculture; UK sugar beet
production; Multi-output cost function; Total factor
productivity
Date: 2005-02
Date: 1998-01
URL: http://d.repec.org/n?u=RePEc:lnd:wpaper:042005&r=agr
20. Analysis of the Impact on UK Sugar Production Efficiency of
Reforming the EU Sugar Regime
Alan W. Renwick (Land Economy Research Group, Scottish
Agricultural College, UK)
Cesar L. Revoredo Giha (Department of Land Economy,
University of Cambridge)
The purpose of the paper is examining the potential implications
for the UK sugar beet sector of the EU sugar regime reform.
Although the reform has yet to be formalised, the initial
proposals centre on price and quota cuts. Using panel data from
the Farm Business Survey for England, the paper estimates two
cost functions: one for the sugar enterprise and another for the
cropping part of the farm (i.e., excludes any livestock
enterprise) and use them to analyse the impacts on profitability
and costs of three possible reform scenarios: a 25 per cent cut
in UK quota, a 25 per cent cut in price, a 40 per cent cut in
price. The results show that the largest gains in terms of
economic efficiency would be achieved under the 40 per cent price
cut; however, the models suggest that this would also lead to the
greatest reduction in production if the fixed costs of producing
sugar were not adjusted.
Keywords: EU sugar reform; UK agriculture; UK sugar beet
production; Multi-output cost function.
Date: 2005-02
Date: 1998-01
URL: http://d.repec.org/n?u=RePEc:lnd:wpaper:072005&r=agr
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