Papers by Anton Bekkerman
The 2004 American Jobs Creation Act created Section 199, a tax provision for producers of domesti... more The 2004 American Jobs Creation Act created Section 199, a tax provision for producers of domestic goods. During the ensuing decade, Section 199 became especially important for agricultural cooperatives, partly because of a series of favorable Internal Revenue Service private letter rulings for marketing cooperatives. We analyze the impacts of Section 199 on agricultural markets by assessing differential effects on the pricing behavior of grain marketing cooperatives and non-cooperatives in Nebraska and Kansas through using a difference-indifference empirical strategy and winter wheat basis data. The results indicate that the series of IRS letter rulings in 2008 widened the basis differential between cooperative and noncooperative firms by almost 5 cents per bushel on average. Furthermore, these market distorting effects are greater for elevator locations that do not have a competing location within 10 miles of their location. While the benefits of Section 199 have been widely toute...
Effectively marketing commodities, understanding market and price dynamics, and managing price ri... more Effectively marketing commodities, understanding market and price dynamics, and managing price risks have become more complex in food markets that are increasingly global, interdependent, computerized, and geopolitically-influenced. Simultaneously, these aspects of agricultural supply chains are critical to the economic sustainability of producers and agribusinesses. As such, there remains continued interest from academia and industry researchers to develop tools and analysis for better understanding the constantly evolving dynamics of commodity markets. There is also continued demand from producers, agribusiness managers, consumers, government agencies, and others who seek to implement these tools for private and public benefit.
Prices offered to farmers by grain handling facilities have been shown to be affected by the spat... more Prices offered to farmers by grain handling facilities have been shown to be affected by the spatial competition structure of the market within which these facilities operate. However, little information exists about how elevators' technological and ownership type characteristics, differences in the demand for grain handling services, and volatility in railcar costs alter grain elevators' pricing behaviors within alternative spatially competitive market structures. This work combines several unique datasets—restricted-access rail waybill sample, daily basis bid information, and elevator-level technological and ownership structure characteristics—to provide an exploratory analysis of the specific factors that can help explain basis bid behaviors across 267 Kansas wheat handling facilities. We provide preliminary evidence that these factors could include variation in the final destination of shipped wheat, increased price variability and uncertainty in secondary railcar market...
Hedonic models are commonly used to quantify the value of characteristics implicit in a product's... more Hedonic models are commonly used to quantify the value of characteristics implicit in a product's price. However, when products are heterogenous across quality levels, using traditional parametric methods for estimating characteristic values may provide poor inferences about quality effects. We propose using a quantile regression framework for estimating the value of characteristics in quality-differentiated products. Semi-parametric quantile regressions allow the data to flexibly identify and estimate quality effects across a conditional price distribution. Using purchase price data from a bull auction, we show complementary non-linear relationships exist between quality and bull carcass and growth traits. Improved precision in understanding consumer valuation of product characteristics across quality market segments can help producers tailor products for each segment.
Journal of Agricultural and Resource Economics, 2018
Many invasive and opportunistic pests cause multiple, interdependent adverse outcomes on agricult... more Many invasive and opportunistic pests cause multiple, interdependent adverse outcomes on agricultural production. Often, however, these impacts are modeled independently, which can bias empirical inferences and contribute to inaccurate recommendations. We use a copula function to more accurately model the joint behavior and provide an empirical example of its application to assess the impacts of the wheat stem sawfly (WSS). We use a unique farm-level dataset to estimate the expected losses associated with WSS and then evaluate two popular WSS management strategies. We find that strategies minimizing long-run infestation levels are preferred to those that seek to maximize yield potential in exchange for higher risk of intertemporal infestation.
Montana agriculture has always faced variability and occasional extreme events. Wry commentary ab... more Montana agriculture has always faced variability and occasional extreme events. Wry commentary about the challenges of such variability might even be called a defining trait of rural culture in Montana. Characterizing the impacts of global climate change on Montana's diverse and historically variable agriculture is not clear cut. In the Third National Climate Assessment Melillo et al. (2014) described the challenge, though for the country as a whole, as follows: 200 | AGRICULTURE AND CLIMATE CHANGE Consequently, in the chapter that follows we emphasize and place higher confidence in projections that are consistent with current climate trends and supported by agricultural data. We must also acknowledge longer-term climate projections that may not yet be manifest as agricultural impacts. We first provide a summary of key climate projections relevant for Montana agriculture, followed by a brief overview of the uncertainties associated with identifying and predicting climate change effects. We next review the influence of climate change on Montana crops and livestock, and on the associated roles of pollinators, disease, pests, and weeds. We also report a number of human adaptations already underway that may increase resilience in the face of climate change. This combination of uncertain projections, local and global effects, and potential for human adaptation makes it difficult to attribute current, much less future, changes and trends in Montana agriculture solely to climate change. Accepting the reality of that uncertainty, we conclude the chapter by discussing future challenges for the agricultural sector related to climate change and the next steps for research and assessment. BACKGROUND Agriculture is a key industry in Montana, generating over $5.2 billion in 2014 through the sale of agricultural commodities (USDA-NASS 2015). Montana's large agricultural industry consists of both crops and livestock, as summarized by revenue in Table 5-1. Agriculture plays a dominant role in the state's land use and its people's sense of place. Thus, even though more Montanans live in cities than on farms and ranches (USDA Census of Agriculture 2012), many of them think of Montana as an agricultural state, where the nonforested landscape is dominated by livestock and crop production. Montana's farm and ranchland is a mosaic of dryland and irrigated agriculture, commodity and specialty cropland, and native and planted rangeland, all set on a backdrop of public and private lands that represent a spectrum from cities to wildlands. The analysis in this chapter separates Montana into seven agricultural regions (USDA-NASS 2015), which correspond to the seven NOAA-defined, Montana climate divisions in Figure 2-3 (Climate chapter). The seven agricultural regions are characterized as follows: • Northwestern and southwestern.-The mountain valleys of the northwestern and southwestern regions are dominated by hay and livestock production with a few isolated areas of small grains, seed potatoes, malt barley, and other rotational crops. In addition, this region has irrigated, small-scale market garden and orchard crops surrounding urban centers and Flathead Lake. 2017 MONTANA CLIMATE ASSESSMENT | 201 24 Appendix 5-1 on the MCA website expands on these data to show acres harvested, yield per acre, tons of production, and animal numbers for each of the seven agricultural regions (see below) in Montana.
Citation: Bekkerman, A., Brester, G. W., & Taylor, M. (2016). Forecasting a moving target: The ro... more Citation: Bekkerman, A., Brester, G. W., & Taylor, M. (2016). Forecasting a moving target: The roles of quality and timing for determining northern U.S. Wheat basis. Journal of Agricultural and Resource Economics, 41(1), 25-41. Retrieved from https://www.scopus.com/inward/record.uri?eid=2-s2.0-84955444036&partnerID=40&md5=5269e2afe2c206ad381f66e84019281d
Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie
Wheat markets stand out among other major crop commodity markets because pricing at the first poi... more Wheat markets stand out among other major crop commodity markets because pricing at the first point of exchange-typically a grain handling facility-is differentiated on specific quality characteristics. Moreover, the premiums and discounts that elevators offer to obtain grain of specific quality can be significant. Despite the relative importance of quality premiums and discounts to farm-level production and marketing decisions, almost no research has examined the factors underlying wheat quality pricing schedules. This study develops an informed expectation model of elevators' quality-based pricing strategies and empirically estimates the model a lengthy dataset of weekly price observations. As such, this research provides the first step toward developing a more accurate understanding of the wheat market and an opportunity to develop price forecasts as a function of wheat quality.
Review of Industrial Organization
Shuttle-loading elevators represent an investment that may lower marginal grain-handling costs. S... more Shuttle-loading elevators represent an investment that may lower marginal grain-handling costs. Some portion of those savings could be passed on to farmers in the form of higher cash prices. We model the pass-through decision and exploit a natural, historical difference in Kansas and Montana wheat markets to test several pass-through hypotheses empirically. Using cross-sectional, temporal, and spatial variation in weekly wheat prices in 2005–2013, we find that—relative to conventional grain elevators in Kansas—shuttle-loading facilities offer a $0.13 per bushel premium. In Montana—where there is less spatial competition among elevators—the pass-through is only $0.04 per bushel.
Library & Information Science Research
When schools are on break, some households may be constrained to provide educational resources to... more When schools are on break, some households may be constrained to provide educational resources to their children. Public libraries could be low-cost providers of materials and services that foster educational investment. This research extends existing literature by combining household-level data-public library checkout counts, residential property tax assessment values, student enrollment rosters, and distance to public library measures-to conduct a panel analysis of public library use across the public school calendar. The empirical analyses find that public-school breaks generally impact library use for households with children in public school, but not for households without children in public school or for the lowest socioeconomic status households with children in public school. Distance to library is found to be negatively correlated with public library use for all households, but differentially and dependent on households' socioeconomic status and structure. Lastly, community events and weather are identified to impact use.
Applied Economic Perspectives and Policy
Economica
Trade can affect relative equipment prices because equipment production is concentrated among a s... more Trade can affect relative equipment prices because equipment production is concentrated among a small group of developed countries and many developing nations rely heavily on equipment imports. We construct a new dataset of relative equipment prices for thirteen Latin American countries from 1970 to 2011 in order to help identify which trade channels affect these prices. We show that both the composition of trade and countries’ trade partners matter. Overall, increasing trade intensity in equipment with major equipment‐producing countries is associated with the largest relative price reductions, but there is significant heterogeneity across countries in their responsiveness to changes in trade intensity and trade restrictions.
Journal of Wine Economics
For many purchases, consumers often possess only limited information about product quality. Thus,... more For many purchases, consumers often possess only limited information about product quality. Thus, observable product characteristics are used to determine expected quality levels when making purchase decisions. We use more than 1 million weekly scanner-level observations from grocery stores across ten U.S. markets between September 2009 and August 2012 to examine how consumers value a wine bottle's closure type (i.e., cork or screw cap). We focus on lower-priced wines—those with sale prices less than $30 per 750 milliliter bottle—to more accurately evaluate decisions of consumers for whom seeking additional information about wine quality is likely more costly than the benefits derived from that information. Using both pooled ordinary least squares and quantile regressions to estimate price premiums for bottles with corks or screw caps, we find that U.S. consumers are willing to pay, on average, approximately 8% more (about $1.00) for a bottle of wine that has a cork closure. In ...
Sustainability
Covering about 40% of Earth’s land surface and sustaining at least 38% of global population, dryl... more Covering about 40% of Earth’s land surface and sustaining at least 38% of global population, drylands are key crop and animal production regions with high economic and social values. However, land use changes associated with industrialized agricultural managements are threatening the sustainability of these systems. While previous studies assessing the impacts of agricultural management systems on biodiversity and their services focused on more diversified mesic landscapes, there is a dearth of such research in highly simplified dryland agroecosystems. In this paper, we 1) summarize previous research on the effects of farm management systems and agricultural expansion on biodiversity and biodiversity-based ecosystem services, 2) present four case studies assessing the impacts of management systems on biodiversity and ecosystem services across highly simplified dryland landscapes of the Northern Great Plains (NGP), USA, 3) discuss approaches to sustain biodiversity-based ecosystem se...
International Food and Agribusiness Management Review
Commodity groups, academics, government agencies, and marketing analysts often have strong intere... more Commodity groups, academics, government agencies, and marketing analysts often have strong interests in understanding changes in demand for products. It is often the case, however, that only equilibrium price and quantity data are available for identifying changes in demand. But, such equilibria are the result of both changes in demand and changes in supply – the latter of which causes changes in quantity demanded. Although an existing index-based method is widely used to identify demand shifts, we consider its theoretical foundation and empirical performance against a proposed alternative. We find that when using widely available but highly aggregated annual-level price and quantity data, our alternative better characterizes demand shifts for goods such as beef, pork, poultry, and lamb. For many agribusinesses that require information about market dynamics in their industry, our method is likely to provide a more accurate, low-cost assessment of demand changes over time.
Ecology and Society
Large-scale agricultural systems are central to food production in North America, but their ubiqu... more Large-scale agricultural systems are central to food production in North America, but their ubiquity could be threatened by vulnerability to economic and climatic stressors during the 21st century. Prior research has focused on understanding the influence of climatic changes on physiological processes in these systems and has increasingly recognized that other factors such as social, economic, and ecological variation and the interaction among these factors may cause unexpected outcomes. We assess the vulnerability of large-scale agricultural systems to variation in multiple stressors and investigate alternative adaptation strategies under novel conditions. We examine dryland farms in Montana's northern Great Plains (NGP), which represent large-scale semiarid agricultural systems that are likely to be affected by climate change. Farmers in the NGP have experienced three distinct periods of economic-and drought-related stressors since the 1970s, primarily driven by uncertainty in soil moisture, but at times amplified by uncertainty in nitrogen fertilizer and wheat prices. We seek to better understand how farmers evaluate and respond to these conditions. The results indicate that although farmers perceived few alternative agronomic options for adapting to drought, strategies for adapting to high input prices were more plentiful. Furthermore, we find that increasing the overall resilience of dryland agricultural systems to economic and climatic uncertainty requires intrinsic valuation of crop rotations and their field-specific response to inputs.
Applied Economic Perspectives and Policy
This study uses farm-level information from the ARMS database to evaluate the distribution of pay... more This study uses farm-level information from the ARMS database to evaluate the distribution of payments from major 2014 Farm Bill safety net programs—federal crop insurance, Agricultural Risk Coverage, and Price Loss Coverage—across farm size. Results indicate that farms within the top decile for crop sales receive over two-thirds of the total payments from these programs. Recent legislative proposals to implement payment caps on each farm are shown to impact a relatively small percentage of farms that are almost entirely within the top decile of crop sales. However, implementing these caps is likely to result in as much as $2.51 billion in taxpayer savings. These help provide direction for continued efforts to design cost-effective, equitable agricultural safety net policies.
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Papers by Anton Bekkerman