Impacts of Ethanol on Planted Acreage in Market Equilibrium

Feng, Hongli; Babcock, Bruce A.

doi:10.1093/ajae/aaq023

Cited by 51 publications

(40 citation statements)

References 15 publications

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“…Farmers' decisions of what crops and how many acres to plant are assumed to be based on their expected net returns prior to the planting time. If net farm returns are expected to increase, more land will be converted to agricultural use (Feng and Babcock 2010). Table 1 shows the composition of cropland in the United States over the past 15 years.…”

Section: Methodsmentioning

confidence: 99%

Agricultural Land Elasticities in the United States and Brazil

Barr

Babcock

Carriquiry

et al. 2011

Applied Eco Perspectives Pol

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The elasticity of aggregate supply is one key to understanding the degree to which policyinduced increases in demand for biofuel feedstocks or agricultural CO2 offsets will result in higher prices or expanded supply. In this paper we report land supply elasticities for the United States and Brazil estimated directly from the observed changes in cropland and estimated changes in expected returns. The resulting aggregate implied land-use elasticities with respect to price are quite inelastic in the United States and more elastic in respectively AbstractThe elasticity of aggregate supply is one key to understanding the degree to which policyinduced increases in demand for biofuel feedstocks or agricultural CO 2 offsets will result in higher prices or expanded supply. In this paper we report land supply elasticities for the UnitedStates and Brazil estimated directly from the observed changes in cropland and estimated changes in expected returns. The resulting aggregate implied land-use elasticities with respect to price are quite inelastic in the United States and more elastic in Brazil (0.007-0.029 and 0.382-0.895, respectively). However, with pasture land included in Brazil, implied elasticities become much less inelastic (0.007-0.245).

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Section: Methodsmentioning

confidence: 99%

Agricultural Land Elasticities in the United States and Brazil

Barr

Babcock

Carriquiry

et al. 2011

Applied Eco Perspectives Pol

Self Cite

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“…In this article, we only examine the change in corn acreage that occurs from moving to the new long-run equilibrium (i.e., steady-state). Our approach to modeling crop rotations in a static, equilibrium framework is similar to Feng and Babcock (2010).…”

Section: Assumption 3 No Dynamic Complementarity In Productionmentioning

confidence: 99%

The Effects of Policy Expectations on Crop Supply, with an Application to Base Updating

Hendricks

Sumner

2014

American J Agri Economics

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We develop a dynamic model to assess the effects of policy expectations on crop supply and illustrate the approach with estimates of the effects of base updating in U.S. crop programs. For corn and soybeans in the Corn Belt, the effect of base updating is relatively small because relevant crop alternatives are subject to similar policies and the alternatives are substitutes in production. Increasing acreage of one program crop to capture future payments from base updating reduces future payments from the alternative crop. We also use our model to assess the effect of base updating on acreage response to prices.

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“…Feng and Babcock (2008) 5 Chakravorty, Hubert and Nostbakken (2009) conclude that "most of them focus on the economics of biofuels supply and in particular address the issue of government policy and how that can affect biofuels production. A smaller sample of the models explicitly considers environmental impacts from biofuels production.…”

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The economics of oil, biofuel and food commodities

Bahel

Marrouch

Gaudet

2013

Resource and Energy Economics

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We study the effects on the food market of the introduction of biofuels as a substitute for fossil fuel in the energy market. We consider a world economy with an oil cartel and a competitive fringe of farmers producing energy in the form of biofuels. Farmers also produce food and sell it on the world food market. We determine the resulting relationship between prices in the energy and food markets and characterize the cartel's extraction path and the price path of energy. We show that the price of food will be growing as long the oil stock is being depleted, whether population is growing or not, and that it will keep growing after the oil stock is exhausted if population is growing. An analysis of the effects of the productivity of land use in either the food or the biofuel sectors is carried out.Keywords: Biofuel; Oil depletion; Population growth; Energy price; Food price RésuméNousétudions l'effet sur le marché des aliments de l'introduction sur le marché de l'énergie de biocarburants, comme substitut aux combustibles fossiles. Nous supposons uneéconomie où cohabitent sur le marché de l'énergie un cartel pétrolier et une frange compétitive de cultivateurs qui produit de l'énergie sous forme de biocarburant. Les cultivateurs produisentégalement des produits agricoles qu'ils vendent sur le marché des aliments. Nous caractérisons la relation qui en résulte entre le prix de l'énergie et le prix des aliments, ainsi que le sentier d'extraction du cartel pétrolier et le sentier de prix de l'énergie. Il est démontré que le prix des aliments va croître aussi longtemps que le stock de pétrole n'est pasépuisé, et cela que la population soit croissante ou non. Il continueraà croître une fois le stock de pétroleépuisé si la population est croissante. Les effets de l'amélioration dans la productivité de la terre dans la production d'aliments ainsi que dans la production de biocarburant sont analysés.

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Impacts of Ethanol on Planted Acreage in Market Equilibrium

Cited by 51 publications

References 15 publications

Agricultural Land Elasticities in the United States and Brazil

Agricultural Land Elasticities in the United States and Brazil

The Effects of Policy Expectations on Crop Supply, with an Application to Base Updating

The economics of oil, biofuel and food commodities

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