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Structural Agricultural Land Use Modelling

  • Fezzi, Carlo
  • Bateman, Ian J.

This paper develops a structural econometric model of agricultural land use and production based on the joint multi-output technology representation introduced by Chambers and Just (1989). Starting from a flexible specification of the farm profit function we derive land use allocation, input applications, crops yield and livestock number equations in a joint and theoretically consistent framework. We present an empirical application using fine-scale spatial data covering the entirety of England and Wales and including the main economic, policy and environmental drivers of land use change in the past 40 years. To account for the presence of censored observations in this micro-level data we estimate the model as a system of two-limits Tobit equations via Quasi-Maximum Likelihood. We finally compare the forecasting ability of our approach against an established benchmark: the land use share logit model.

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File URL: http://purl.umn.edu/51423
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Paper provided by International Association of Agricultural Economists in its series 2009 Conference, August 16-22, 2009, Beijing, China with number 51423.

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Date of creation: 2009
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Handle: RePEc:ags:iaae09:51423
Contact details of provider: Web page: http://www.iaae-agecon.org/
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  1. David E. Sahn, 2005. "Consistent Estimation of Censored Demand Systems Using Panel Data," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 87(3), pages 660-672.
  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. Ball, V. Eldon & Bureau, Jean-Christophe & Eakin, Kelly & Somwaru, Agapi, 1997. "Cap reform: modelling supply response subject to the land set-aside," Agricultural Economics of Agricultural Economists, International Association of Agricultural Economists, vol. 17(2-3), December.
  4. 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.
  5. Raja Chakir, 2009. "Spatial Downscaling of Agricultural Land-Use Data: An Econometric Approach Using Cross Entropy," Land Economics, University of Wisconsin Press, vol. 85(2), pages 238-251.
  6. S. Niggol Seo & Robert Mendelsohn, 2008. "Measuring impacts and adaptations to climate change: a structural Ricardian model of African livestock management-super-1," Agricultural Economics, International Association of Agricultural Economists, vol. 38(2), pages 151-165, 03.
  7. Douglas J. Miller, 1999. "An Econometric Analysis of the Costs of Sequestering Carbon in Forests," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 81(4), pages 812-824.
  8. Guyomard, Herve & Baudry, Marc & Carpentier, Alain, 1996. "Estimating Crop Supply Response in the Presence of Farm Programmes: Application to the CAP," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 23(4), pages 401-20.
  9. Wu, JunJie & Adams, Richard M. & Kling, Catherine L. & Tanaka, Katsuya, 2004. "From Microlevel Decisions to Landscape Changes: An Assessment of Agricultural Conservation Policies," Staff General Research Papers 12519, Iowa State University, Department of Economics.
  10. Just, Richard E & Antle, John M, 1990. "Interactions between Agricultural and Environmental Policies: A Conceptual Framework," American Economic Review, American Economic Association, vol. 80(2), pages 197-202, May.
  11. Carlos Arnade & David Kelch, 2007. "Estimation of Area Elasticities from a Standard Profit Function," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 89(3), pages 727-737.
  12. Federico Perali & Jean-Paul Chavas, 2000. "Estimation of Censored Demand Equations from Large Cross-Section Data," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 82(4), pages 1022-1037.
  13. Barten, A. P., 1969. "Maximum likelihood estimation of a complete system of demand equations," European Economic Review, Elsevier, vol. 1(1), pages 7-73.
  14. Kenneth M. Chomitz & Timothy S. Thomas, 2003. "Determinants of Land Use in Amaz´┐Żnia: A Fine-Scale Spatial Analysis," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 85(4), pages 1016-1028.
  15. Diansheng Dong & Brian W. Gould & Harry M. Kaiser, 2004. "Food Demand in Mexico: An Application of the Amemiya-Tobin Approach to the Estimation of a Censored Food System," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 86(4), pages 1094-1107.
  16. J. Scott Shonkwiler & Steven T. Yen, 1999. "Two-Step Estimation of a Censored System of Equations," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 81(4), pages 972-982.
  17. Steven T. Yen, 2002. "Beverage consumption among US children and adolescents: full-information and quasi maximum-likelihood estimation of a censored system," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 29(1), pages 85-104, March.
  18. Barry T. Coyle, 1999. "Risk Aversion and Yield Uncertainty in Duality Models of Production: A Mean-Variance Approach," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 81(3), pages 553-567.
  19. Lansink, Alfons Oude & Peerlings, Jack, 1996. "Modelling the New EU Cereals and Oilseeds Regime in the Netherlands," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 23(2), pages 161-78.
  20. Boots, Maroeska & Oude Lansink, Alfons & Peerlings, Jack, 1997. "Efficiency Loss Due to Distortions in Dutch Milk Quota Trade," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 24(1), pages 31-46.
  21. Plantinga, Andrew J. & Ahn, Soeun, 2002. "Efficient Policies For Environmental Protection: An Econometric Analysis Of Incentives For Land Conversion And Retention," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 27(01), July.
  22. Amemiya, Takeshi, 1973. "Regression Analysis when the Dependent Variable is Truncated Normal," Econometrica, Econometric Society, vol. 41(6), pages 997-1016, November.
  23. Steven T. Yen & Biing-Hwan Lin & David M. Smallwood, 2003. "Quasi- and Simulated-Likelihood Approaches to Censored Demand Systems: Food Consumption by Food Stamp Recipients in the United States," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 85(2), pages 458-478.
  24. Alessandro Pinto & Gerald C. Nelson, 2009. "Land Use Change with Spatially Explicit Data: A Dynamic Approach," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 43(2), pages 209-229, June.
  25. Christian Langpap & Ivan Hascic & JunJie Wu, 2008. "Protecting Watershed Ecosystems through Targeted Local Land Use Policies," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 90(3), pages 684-700.
  26. White, Halbert, 1982. "Maximum Likelihood Estimation of Misspecified Models," Econometrica, Econometric Society, vol. 50(1), pages 1-25, January.
  27. Just, Richard E., 2000. "Some Guiding Principles For Empirical Production Research In Agriculture," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 29(2), October.
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