No abstract

This paper introduces a game theoretic model of groundwater extraction in a two-cell aquifer under incomplete information. A novel assumption is that individual users have incomplete knowledge of the speed of lateral flows in the aquifer: although a user is aware that his neighbor's water use has some influence on his future water stock, he is uncertain about the degree of this impact. We find that the lack of information may either increase or decrease the rate of water use and welfare. In a two-period framework, the relevant characteristic is the ratio of the periodic marginal benefits of water use. Depending on whether this ratio is convex or concave, the average speed with which the aquifer is depleted decreases or increases when users learn more about the local hydrologic properties of groundwater. In principle, welfare may decrease even in cases when the groundwater allocation is closer to the efficient groundwater allocation.

Journal articleIFPRI3; ISI; B Promoting healthy food systems; C Improving markets and tradeMTIDP

Notices IFPRI Discussion Papers contain preliminary material and research results. They have been peer reviewed, but have not been subject to a formal external review via IFPRI's Publications Review Committee. They are circulated in order to stimulate discussion and critical comment; any opinions expressed are those of the author(s) and do not necessarily reflect the policies or opinions of IFPRI.

No abstract

There exists much uncertainty about consumer attitudes toward genetically modified foods. If it happens that sufficient (insufficient) acres are planted under nonmodified seed to meet postharvest demand, then a price premium will not (will) emerge for the nonmodified varieties. A nonlinearity originates in the fact that a price premium may not be supported. This nonlinearity interacts with demand uncertainty to determine equilibrium plantings and the probability that postharvest varietal prices differ. Also, as planting approaches signals will be broadcast about the nature of postharvest demand. We show how the nonlinearity affects the types of signals that growers will prefer to receive. Copyright 2002, Oxford University Press.

Journal articleIFPRI3; ISI; CRP2; GRP23MTID; PIMPRCGIAR Research Program on Policies, Institutions, and Markets (PIM

Journal articleIFPRI3; ISIMTIDP