ADVANCES IN APPLIED AGRICULTURAL AND EXPERIMENTAL ECONOMICS

Hao Li

This dissertation contains three pieces of empirical research in agricultural and experimental economics. The first piece of research examines impacts of droughts and drought-induced water usage restrictions (curtailments) on agriculture sector in Central Washington. Washington state is a major agricultural producer in the United States and also suffers from frequent irrigation water shortage. My research explores how and to what extend limited irrigation water availability could affect agriculture sector in the interested area. I consider two models and integrate them into a biophysical-agroeconomics system. Using statistic methods, I assess the system jointly. The first model account for crops biophysical responses to droughts the drought induced water curtailments, and the second model studies farmers’ agroeconomic response to droughts and curtailments. I simulate farmers’ expectations of yields from the biophysical model and pass them to the agroeconomic model. Then I assess farmers’ responses to drought with empirical data. I find that droughts and curtailments have negative impacts on crops yields, but their effects on crops planted acreages vastly vary. This study also attempts to find clues of drought mitigation strategies that farmers may adopt. The second research investigates the evolution of China’s aquaculture productivity after its the late 1970’s economic reform. Aquaculture industry in China has been rapidly growing in the past four decades, but whether the growth should be attributed to productivity improvement or to input expansion is largely unknown. This research examines the underlying factor that promotes the output growth, namely the aquaculture productivity, technological progress, and the scale effects. I develop an empirical model to quantitatively assess the productivity and its growth and decompose the productivity growth into technical progress and scale effects. I find that the productivity in China’s aquaculture sector has been steadily growing, and the leading cause of the productivity growth is technical progress rather than scale effects. The third study focuses on the interactions between consumers’ quality expectation of animal products with animal welfare attributes and their consumption behaviors. Consumers’ awareness of animal welfare issues largely determines their willingness to pay for animal products, and this awareness also leads to a higher expectation of the quality that animal welfare products may convey. This research focuses on one’s quality expectation, leverages empirical data from a series of experimental auctions, and analyzes the influences of one’s purchase motivation on their consumption. I find that impacts of the quality expectation are relatively minimal, and the moral concerns may be a decisive factor.

ADVANCES IN APPLIED AGRICULTURAL AND EXPERIMENTAL ECONOMICS

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