ESTIMATING MARGINAL IMPLICIT PRICES FOR SELECTED QUALITY ATTRIBUTES OF HYBRID SEED CORN

The central objective of this study was to estimate the implicit marginal prices for the following attributes of hybrid seed corn: yield, moisture content, root lodging, stalk lodging, stand survival and ear drop. This study fills an existent gap in the application of a hedonic price technique to agricultural commodities. A hedonic price equation was constructed and estimated using characteristics data on hybrid corn varieties obtained from the Iowa State University Extension Service. Seed price data were solicited from seed companies for the same set of hybrids. In total, fifty-nine seed companies were asked for suggested retail prices for their hybrids. Forty companies responded with 1991 price information which was used in estimating the parameters of the formulated models. Six hypotheses relating the price paid for hybrid seed corn with the performance characteristics of interest were formulated and tested. Results indicate that the prices that farmers paid for hybrid seed corn were significantly related only to (1) the moisture content and (2) the root lodging characteristics of the resulting crop. Both results were significant at the 0.005 level. Surprisingly, seed price and yield were not significantly related. More research is needed to further analyze these relationships and to analyze farmer's response to the wide range of nonprice services provided by seed companies.