This paper assesses the impacts of decoupled government transfers on production decisions of a sample of Kansas farms observed from 1996 to 2001. Our model allows for risk, risk attitudes and the intertemporal investment decisions. We also allow for different adjustments of the decision variables depending on the predominant economic conditions. The theoretical model is estimated using the threshold regression methods proposed by Hansen (1999). Threshold effects are allowed to characterize the behavior of output supply and quasi-fixed and variable input demand.. The econometric results support the existence of three regimes characterized by different economic behavior. Our analysis suggests that in a dynamic setting with risk and non-risk neutral economic agents, decoupled transfers can have a powerful influence on decisions taken by economic agents. The dynamics of the stock of capital cause this influence to grow over time.
Download Info
To download:
If you experience problems downloading a file, check if you have the
proper application to
view it first. Information about this may be contained
in the File-Format links below. In case of further problems read
the IDEAS help
page. Note that these files are not on the IDEAS
site. Please be patient as the files may be large.
Length: Date of creation: 2008 Date of revision: Handle: RePEc:ags:aaea08:6511
Contact details of provider: Postal: 555 East Wells Street, Suite 1100, Milwaukee, Wisconsin 53202 Phone: (414) 918-3190 Fax: (414) 276-3349 Email: Web page: http://www.aaea.org More information through EDIRC
For technical questions regarding this item, or to correct its listing, contact: (AgEcon Search).
References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.: