IDEAS home Printed from https://ideas.repec.org/a/kap/enreec/v59y2014i4p537-559.html
   My bibliography  Save this article

Multicrop Production Models with Multinomial Logit Acreage Shares

Author

Listed:
  • Alain Carpentier

    ()

  • Elodie Letort

Abstract

The main objective of this paper is to show that the MultiNomial Logit (MNL) framework can be used for deriving simple acreage share models. More specifically we show that MNL acreage choice models can be defined as parts of consistent multicrop models. When coupled with suitably designed crop production models, e.g. a specific parameterization of the standard quadratic yield function, the parameters of these multicrop models are easily interpreted and estimated. Although MNL acreage choice models are usually derived by aggregating crop choices defined at the plot level, we show that these models can also be derived by considering a profit maximisation problem at the farm level. This provides a simple theoretical background for the Standard MNL acreage share model, as well as for simple extensions of these models: the Nested MNL acreage share models. An empirical application on French farm-level data over the period 1996–2007 investigates the empirical performances of the multicrop econometric models based on the proposed MNL framework for modelling acreage choices. Copyright Springer Science+Business Media Dordrecht 2014

Suggested Citation

  • Alain Carpentier & Elodie Letort, 2014. "Multicrop Production Models with Multinomial Logit Acreage Shares," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 59(4), pages 537-559, December.
  • Handle: RePEc:kap:enreec:v:59:y:2014:i:4:p:537-559
    DOI: 10.1007/s10640-013-9748-6
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1007/s10640-013-9748-6
    Download Restriction: Access to full text is restricted to subscribers.

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Carlo Fezzi & Ian J. Bateman, 2011. "Structural Agricultural Land Use Modeling for Spatial Agro-Environmental Policy Analysis," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 93(4), pages 1168-1188.
    2. Lubowski, Ruben N. & Plantinga, Andrew J. & Stavins, Robert N., 2006. "Land-use change and carbon sinks: Econometric estimation of the carbon sequestration supply function," Journal of Environmental Economics and Management, Elsevier, vol. 51(2), pages 135-152, March.
    3. Junjie Wu & B. Wade Brorsen, 1995. "The Impact of Government Programs and Land Characteristics on Cropping Patterns," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 43(1), pages 87-104, March.
    4. Thomas Heckelei & Hendrik Wolff, 2003. "Estimation of constrained optimisation models for agricultural supply analysis based on generalised maximum entropy," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 30(1), pages 27-50, March.
    5. Miranowski, John & Orazem, Peter, 1994. "A Dynamic Model of Acreage Allocation with General and Crop-Specific Capital," Staff General Research Papers Archive 10695, Iowa State University, Department of Economics.
    6. Jean-Paul Chavas & Matthew T. Holt, 1990. "Acreage Decisions Under Risk: The Case of Corn and Soybeans," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 72(3), pages 529-538.
    7. Alain Carpentier & Elodie Letort, 2012. "Accounting for Heterogeneity in Multicrop Micro-Econometric Models: Implications for Variable Input Demand Modeling," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 94(1), pages 209-224.
    8. Jonathan Kaminski & Iddo Kan & Aliza Fleischer, 2013. "A Structural Land-Use Analysis of Agricultural Adaptation to Climate Change: A Proactive Approach," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 95(1), pages 70-93.
    9. Andrew J. Plantinga, 1996. "The Effect of Agricultural Policies on Land Use and Environmental Quality," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 78(4), pages 1082-1091.
    10. Ian W. Hardie & Peter J. Parks, 1997. "Land Use with Heterogeneous Land Quality: An Application of an Area Base Model," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(2), pages 299-310.
    11. Steven T. Berry, 1994. "Estimating Discrete-Choice Models of Product Differentiation," RAND Journal of Economics, The RAND Corporation, vol. 25(2), pages 242-262, Summer.
    12. Quirino Paris & Richard E. Howitt, 1998. "An Analysis of Ill-Posed Production Problems Using Maximum Entropy," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 80(1), pages 124-138.
    13. Train,Kenneth E., 2009. "Discrete Choice Methods with Simulation," Cambridge Books, Cambridge University Press, number 9780521747387, December.
    14. Alfons Oude Lansink & Spiro Stefanou, 2001. "Dynamic Area Allocation and Economies of Scale and Scope," Journal of Agricultural Economics, Wiley Blackwell, vol. 52(3), pages 38-52, September.
    15. Douglas J. Miller & Andrew J. Plantinga, 1999. "Modeling Land Use Decisions with Aggregate Data," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 81(1), pages 180-194.
    16. Chamberlain, Gary, 1987. "Asymptotic efficiency in estimation with conditional moment restrictions," Journal of Econometrics, Elsevier, vol. 34(3), pages 305-334, March.
    17. Moore, Michael R. & Negri, Donald H., 1992. "A Multicrop Production Model Of Irrigated Agriculture, Applied To Water Allocation Policy Of The Bureau Of Reclamation," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 17(1), pages 1-15, July.
    18. Theil, Henri, 1969. "A Multinomial Extension of the Linear Logit Model," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 10(3), pages 251-259, October.
    19. Alban Thomas, 2003. "A dynamic model of on-farm integrated nitrogen management," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 30(4), pages 439-460, December.
    20. Asunka, Samuel & Shumway, C. Richard, 1996. "Allocatable Fixed Inputs and Jointness in Agricultural Production: More Implications," Agricultural and Resource Economics Review, Cambridge University Press, vol. 25(2), pages 143-148, October.
    21. Verboven, Frank, 1996. "The nested logit model and representative consumer theory," Economics Letters, Elsevier, vol. 50(1), pages 57-63, January.
    22. Søren Arnberg & Lars Gårn Hansen, 2012. "Short‐run and long‐run dynamics of farm land allocation: panel data evidence from Denmark-super-1," Agricultural Economics, International Association of Agricultural Economists, vol. 43(2), pages 179-190, March.
    23. Considine, Timothy J & Mount, Timothy D, 1984. "The Use of Linear Logit Models for Dynamic Input Demand Systems," The Review of Economics and Statistics, MIT Press, vol. 66(3), pages 434-443, August.
    24. Miller, Douglas & Plantinga, Andrew J., 1999. "Modeling Land Use Decisions with Aggregate Data," Staff General Research Papers Archive 1487, Iowa State University, Department of Economics.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Xinde Ji & Kelly M. Cobourn, 2018. "The Economic Benefits of Irrigation Districts under Prior Appropriation Doctrine: An Econometric Analysis of Agricultural Land‐Allocation Decisions," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 66(3), pages 441-467, September.
    2. Kimhi, A., 2018. "Integrated Micro-Macro Structural Econometric Framework for Assessing Climate-Change Impacts on Agricultural Production and Food Markets," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 276972, International Association of Agricultural Economists.
    3. Cobourn, Kelly M. & Ji, Xinde & Mooney, Sian & Crescenti, Neil, 2017. "Water right seniority, economic efficiency and land allocation decisions," 2017 Annual Meeting, July 30-August 1, Chicago, Illinois 258271, Agricultural and Applied Economics Association.
    4. 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.
    5. Koutchad, P. & Carpentier, A. & Femenia, F., 2018. "Dealing with corner solutions in multi-crop micro-econometric models: an endogenous regime approach with regime fixed costs," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 277530, International Association of Agricultural Economists.
    6. Femenia, Fabienne & Letort, Elodie, 2014. "Economic incentives to the adoption of low input cropping systems: the case of multi-resistant wheat cultivars in France," 2014 International Congress, August 26-29, 2014, Ljubljana, Slovenia 182743, European Association of Agricultural Economists.
    7. Koutchadé, Philippe & Carpentier, Alain & Féménia, Fabienne, 2015. "Empirical modelling of production decisions of heterogeneous farmers with mixed models," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 205098, Agricultural and Applied Economics Association.
    8. Koutchade, Philippe & Carpentier, Alain & Femenia, Fabienne, 2015. "Accounting for unobserved heterogeneity in micro-econometric agricultural production models: a random parameter approach," 2015 Conference, August 9-14, 2015, Milan, Italy 212015, International Association of Agricultural Economists.
    9. Koutchade, Philippe & Carpentier, Alain & Féménia, Fabienne, 2015. "Empirical modeling of production decisions of heterogeneous farmers with random parameter models," Working Papers 210097, Institut National de la recherche Agronomique (INRA), Departement Sciences Sociales, Agriculture et Alimentation, Espace et Environnement (SAE2).
    10. Carpentier, Alain & Gohin, Alexandre, 2014. "Accounting for crop rotations in acreage choice modeling: a tractable modeling framework," 2014 International Congress, August 26-29, 2014, Ljubljana, Slovenia 182799, European Association of Agricultural Economists.
    11. Alain Carpentier & Alexandre Gohin, 2015. "On the economic theory of crop rotations: value of the crop rotation effects and implications on acreage choice modeling," Working Papers SMART - LERECO 15-04, INRAE UMR SMART-LERECO.
    12. Ji, Xinde & Cobourn, Kelly M., 2017. "Water Availability, Land Allocation, and the Role of Irrigation Districts under Prior Appropriation Doctrine," 2017 Annual Meeting, July 30-August 1, Chicago, Illinois 258377, Agricultural and Applied Economics Association.
    13. Kan, Iddo & Kimhi, Ayal & Kaminski, Jonathan, 2015. "Climate-Change Impacts on Agriculture and Food Markets: Combining a Micro-Level Structural Land-Use Model and a Market-Level Equilibrium Model," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 205128, Agricultural and Applied Economics Association.
    14. Koutchade, Obafèmi Philippe & Carpentier, Alain & Femenia, Fabienne, 2015. "Corner solutions in empirical acreage choice models: an andogeneous switching regime approach with regime fixed cost," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 206060, Agricultural and Applied Economics Association.
    15. Hyunseok Kim & GianCarlo Moschini, 2018. "The Dynamics of Supply: U.S. Corn and Soybeans in the Biofuel Era," Land Economics, University of Wisconsin Press, vol. 94(4), pages 593-613.
    16. Smith, V. & De Pinto, A. & Robertson, R., 2018. "The Role of Risk in the Context of Climate Change, Land Use Choices and Crop Production: Evidence from Zambia," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 277315, International Association of Agricultural Economists.
    17. Féménia, Fabienne & Letort, Elodie, 2016. "How to achieve significant reduction in pesticide use? An empirical evaluation of the impacts of pesticide taxation associated to a change in cropping practice," Working Papers 233482, Institut National de la recherche Agronomique (INRA), Departement Sciences Sociales, Agriculture et Alimentation, Espace et Environnement (SAE2).
    18. Gohin, Alexandre, 2017. "On the direct, indirect and induced impacts of public policies: The European biofuel case," Working Papers 264955, Institut National de la recherche Agronomique (INRA), Departement Sciences Sociales, Agriculture et Alimentation, Espace et Environnement (SAE2).
    19. Alexandre Gohin, 2017. "On the direct, indirect and induced impacts of public policies: The European biofuel case," Working Papers SMART - LERECO 17-09, INRAE UMR SMART-LERECO.
    20. Kan, Iddo & Reznik, Ami & Kimhi, Ayal & Kaminski, Jonathan, 2018. "The Impacts of Climate Change on Cropland Allocation, Crop Production, Output Prices and Social Welfare in Israel: A Structural Econometric Framework," Discussion Papers 290059, Hebrew University of Jerusalem, Department of Agricultural Economics and Management.
    21. Femenia, Fabienne & Letort, Elodie, 2016. "How to significantly reduce pesticide use: An empirical evaluation of the impacts of pesticide taxation associated with a change in cropping practice," Ecological Economics, Elsevier, vol. 125(C), pages 27-37.
    22. Cornelis Gardebroek & Jeffrey J. Reimer & Lieneke Baller, 2017. "The Impact of Biofuel Policies on Crop Acreages in Germany and France," Journal of Agricultural Economics, Wiley Blackwell, vol. 68(3), pages 839-860, September.
    23. Bareille, François & Dupraz, Pierre, 2016. "Biodiversity productive effects in milk farms of western France: a multi-output primal system," 149th Seminar, October 27-28, 2016, Rennes, France 244774, European Association of Agricultural Economists.
    24. Kan, Iddo & Kimhi, Ayal & Kaminski, Jonathan, 2015. "Micro-Macro Impacts of Climate-Change on Agriculture and Food Markets," 2015 Conference, August 9-14, 2015, Milan, Italy 211828, International Association of Agricultural Economists.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:enreec:v:59:y:2014:i:4:p:537-559. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sonal Shukla) or (Springer Nature Abstracting and Indexing). General contact details of provider: http://www.springer.com .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.