We develop a real option model of the irreversible native grassland conversion decision. Upon plowing, native grassland can be followed by either a permanent cropping system or a system in which land is put under cropping (respectively, grazing) whenever crop prices are high (respectively, low)....

The U.S. Federal Government implements environmental, biofuels and crop insurance programs that influence land use. They are not well-integrated in that cost savings from crop insurance subsidies are not acknowledged when screening land for retirement or when calculating the cost of land...

Rate setting methods for crop yield and revenue contracts employ methods that presume that correlations are state invariant. Whether this is true matters. If yield-yield correlations strengthen when crops are subject to widespread stress then diversification opportunities for private insurers...

The efficiency of redistribution and the level of government costs of revenue assurance are compared with current farm programs. The results suggest that a revenue assurance program that uses a fixed base acreage and actual or county average yields to assure whole farm revenues could provide a...

The U.S. market in subsidized commodity revenue insurance contracts has expanded rapidly since 1996. By far the most prevalent contract forms are crop-specific, rather than the whole-farm design which has a better claim to being optimal. For an arbitrary acre allocation vector, this paper...

Renewable Fuel Standard (RFS) aims to support investment in cellulosic biofuel refineries by mandating a floor on the amount of biofuels being consumed in every calendar year. Tradable Renewable Identification Numbers (RINs) is the market mechanism by which the mandates are to be met. But the...

Domestic water consumers in many developing countries boil water before use, presumably concerned about quality control on the part of upstream water authorities. In this paper we investigate strategic incentives for food safety efforts by upstream food processors and downstream consumers. The...

Empirical studies point to negative crop yield skewness, but the literature provides few clear insights as to why. This paper formalizes three points on the matter. Statistical laws on aggregates do not imply a normal distribution. Whenever the weather-conditioned mean yield has diminishing...

The U.S. market in subsidized commodity revenue insurance contracts has expanded rapidly since 1996. By far the most prevalent contract forms are crop-specific, rather than the whole-farm design which has a better claim to being optimal. For an arbitrary acre allocation vector, this paper...