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Accounting for Heterogeneity in Multicrop Micro-Econometric Models: Implications for Variable Input Demand Modeling

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  • Alain Carpentier
  • Elodie Letort

Abstract

This article aims to show that if the farm sample under consideration is characterized by significant heterogeneity, recovering output-specific input uses or modeling farm-level input uses may be more complicated than previously recognized. The article theoretically investigates the problems implied by farm heterogeneity in input allocation equations and multicrop econometric models, proposes an empirically tractable solution for overcoming these problems, and assesses the empirical relevance of the theoretically identified problems. The results demonstrate that heterogeneity matters, but that the revealed heterogeneity bias has a limited impact on the empirical results. Copyright 2012, Oxford University Press.

Suggested Citation

  • 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.
  • Handle: RePEc:oup:ajagec:v:94:y:2012:i:1:p:209-224
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    File URL: http://hdl.handle.net/10.1093/ajae/aar132
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    Citations

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    Cited by:

    1. Adélaïde Fadhuile & Stéphane Lemarié & Alain Pirotte, 2016. "Disaggregating the Demand for Pesticides: Does it Matter?," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 64(2), pages 223-252, June.
    2. Beghin, John C. & Bureau, Jean-Christophe & Gohin, Alex, 2014. "The Impact of an EU-US TTIP Agreement on Biofuel and Feedstock Markets," Proceedings Issues, 2014: Food, Resources and Conflict, December 7-9, 2014, San Diego, California 197153, International Agricultural Trade Research Consortium.
    3. Alexandre Gohin, 2013. "The land use changes of European biodiesel: sensitivity to crop yield evolutions," Working Papers SMART - LERECO 13-13, INRA UMR SMART-LERECO.
    4. Fabienne Féménia & Elodie Letort, 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 SMART - LERECO 16-02, INRA UMR SMART-LERECO.
    5. John C. Beghin & Jean-Christophe Bureau & Alexandre Gohin, 2017. "The Impact of an EU–US Transatlantic Trade and Investment Partnership Agreement on Biofuel and Feedstock Markets," Journal of Agricultural Economics, Wiley Blackwell, vol. 68(2), pages 321-344, June.
    6. Alexandre Gohin, 2014. "Assessing the Land Use Changes and Greenhouse Gas Emissions of Biofuels: Elucidating the Crop Yield Effects," Land Economics, University of Wisconsin Press, vol. 90(4), pages 575-586.
    7. Ridier, Aude & Chaib, Karim & Roussy, Caroline, 2016. "A Dynamic Stochastic Programming model of crop rotation choice to test the adoption of long rotation under price and production risks," European Journal of Operational Research, Elsevier, vol. 252(1), pages 270-279.
    8. 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.
    9. 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;Western Agricultural Economics Association.
    10. Alexandre Gohin, 2017. "On the direct, indirect and induced impacts of public policies: The European biofuel case," Working Papers SMART - LERECO 17-09, INRA UMR SMART-LERECO.
    11. F. G. Santeramo & B. K. Goodwin & F. Adinolfi & F. Capitanio, 2016. "Farmer Participation, Entry and Exit Decisions in the Italian Crop Insurance Programme," Journal of Agricultural Economics, Wiley Blackwell, vol. 67(3), pages 639-657, September.
    12. 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.
    13. 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.
    14. 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.
    15. 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.
    16. 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;Western Agricultural Economics Association.
    17. 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, INRA UMR SMART-LERECO.
    18. 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.
    19. Philippe Koutchade & Alain Carpentier & Fabienne Féménia, 2015. "Empirical modeling of production decisions of heterogeneous farmers with random parameter models," Working Papers SMART - LERECO 15-10, INRA UMR SMART-LERECO.

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