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Micro Versus Macro Acreage Response Models: Does Site-Specific Information Matter?

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  • Wu, JunJie
  • Adams, Richard M.

Abstract

Because requisite micro data frequently are unavailable, it is common practice to use aggregate data to estimate economic relationships representing the behavior of individual agents. A substantial body of literature has examined conditions under which inferences between micro and aggregate specifications can be made. Less attention has been focused on the relative accuracy of predictions for each scale of model. In an empirical application, we compare the goodness-of-fit measures of eight sets of acreage response models, varying in aggregation from field- (micro-) level to regional- (macro-) level models. Results suggest aggregate models are superior to the micro model in predicting acreage response, even thought the micro models contain substantially more data on site-specific characteristics.

Suggested Citation

  • Wu, JunJie & Adams, Richard M., 2002. "Micro Versus Macro Acreage Response Models: Does Site-Specific Information Matter?," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 27(1), pages 1-21, July.
    • Handle: RePEc:ags:jlaare:31074
    DOI: 10.22004/ag.econ.31074
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    1. Carpentier, Alain & Gohin, Alexandre & Sckokai, Paolo & Thomas, Alban, 2015. "Economic modelling of agricultural production: past advances and new challenges," Revue d'Etudes en Agriculture et Environnement, Editions NecPlus, vol. 96(01), pages 131-165, March.
    2. Ramsey, Steven M. & Bergtold, Jason S. & Heier Stamm, Jessica, 2018. "An Artificial Neural Network Approach to Acreage-Share Modeling," 2018 Annual Meeting, August 5-7, Washington, D.C. 274395, Agricultural and Applied Economics Association.
    3. Qiuqiong Huang & Richard Howitt & Scott Rozelle, 2012. "Estimating production technology for policy analysis: trading off precision and heterogeneity," Journal of Productivity Analysis, Springer, vol. 38(2), pages 219-233, October.
    4. Banerjee, Swagata (Ban) & Martin, Steven W. & Roberts, Roland K. & Larson, James A. & Hogan, Robert J., Jr. & Johnson, Jason L. & Paxton, Kenneth W. & Reeves, Jeanne M., 2007. "Adoption of Conservation-Tillage Practices in Cotton Production," 2007 Annual Meeting, February 4-7, 2007, Mobile, Alabama 34842, Southern Agricultural Economics Association.
    5. Keeney, Roman & Hertel, Thomas W., 2008. "Yield Response To Prices: Implications For Policy Modeling," Working papers 45969, Purdue University, Department of Agricultural Economics.
    6. Jean-Sauveur Ay & Raja Chakir & Julie Le Gallo, 2014. "The effects of scale, space and time on the predictive accuracy of land use models," Working Papers 2014/02, INRA, Economie Publique.

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