Applied Economics and Policy Working Paper Series

Permanent URI for this collection

https://hdl.handle.net/1813/102799

This working paper series is collection of applied economics and policy research by faculty, graduate students (with faculty approval), and visiting scholars of the Charles H. Dyson School of Applied Economics and Management, School of Hotel Administration, and the Johnson Graduate School of Management of the SC Johnson College of Business at Cornell University.

Browse

Now showing 1 - 10 of 26

China’s Import Tariffs on U.S. Soybean Exports 2018-2022: Effects on Information Transfer between Markets in China, the U.S. and Brazil
Turvey, Calum; Gomez, Miguel; de Gorter, Harry; Stelmach, Juraj (2023-03)
This paper investigates the impacts of China’s import tariffs on U.S. soybean exports in mid-2008 on price diffusion and information transfer relationships between futures prices in the U.S., China, and Brazil. About a third of U.S. soybean production was exported to China so the import tariff on U.S. soybean exports induced China to increase imports from Brazil, mitigating the effect of the tariff on China’s domestic prices. Nevertheless, U.S. soybean cash and futures prices plummeted while Brazilian export prices rose in the months ahead. To assess the information transfer relationships, we use vector autoregressive model to generate pairwise tests on the causal covariate differences between the U.S., China, and Brazilian soybean futures prices before and after mid-2008. Results show that previous patterns of price signaling between the U.S. close and China open, and the China close and U.S. open, have all but evaporated since the import tariffs imposed on U.S. exports to China in mid-2008, and recovered only by September 2020. We show, with no ambiguity that where complementary, and causal, price signals between the U.S. and China exchanges were strong and significant at the 1 percent level prior to the tariff, signaling lost all significance up to the 10 percent level thereafter. In contrast, the China close and Brazil open have strengthened throughout the time period with price signalling from China to Brazil became significant at the 1 percent level after the tariffs were imposed and also significant from Brazil to China. This import tariff provided a natural experiment on the effects of a tariff on price information transfers between different markets worldwide as global trade patterns in soybeans changed. We also consider the signaling effect between U.S. soybean futures price and the spot price in China.
Measurement of Frozen versus Fresh Food Waste at the Retail and Consumer Levels: A Critical Review and Meta Analysis
de Gorter, Harry; Hao, Jieyu; Just, David R.; Kliauga, Erika (2022-12)
Food waste at retail and consumer levels is staggering, with estimates as high as 35 percent of purchases with most discarded in landfills. This study summarizes the literature that shows retail and consumer waste rates for frozen food are substantially lower than their fresh counterparts in almost all cases. The advantage of frozen food is particularly evident for fruit and vegetable products. We also present some of the reasons for frozen food waste identified in the literature, and why rates are lower than for fresh products. We also critique the methodology used in the literature and outline a more ideal methodology for future research on food waste by consumers.
Employer Power and Employment in Developing Countries
Chau, Nancy H.; Kanbur, Ravi; Soundararajan, Vidhya (2022-09-02)
The issue of employer power is underemphasized in the development literature. The default mod el is usually one of competitive labor markets. This assumption matters for analysis and policy prescription. There is growing evidence that the competitive labor markets assumption is not valid for developing countries. Our objective in this paper is to review this evidence, to present theoretical and policy perspectives which follow from it, and to highlight areas for further research.
Economic impact assessment of public incentives to support farm-to-school food purchases
Krasnoff, Shayna M.; Schmit, Todd M.; Bilinski, Cheryl B. (2022-09-02)
Farm-to-school projects have been widely supported by policy makers with funding provided at both the federal and state levels. Still, many of the outcomes of this inflow of policy and funding remain unclear. In 2018, New York State (USA) announced the 30% NY Initiative that increases school lunch reimbursements by $0.191 per meal if districts purchase at least 30% of their ingredients from New York farms. With detailed school food purchasing data from the Buffalo City School District for both before and after the Initiative started, we analyze the gross and net economic impacts of the increased local spending on the state economy through a customized input-output model. Results show net positive economic impacts of the policy, even when a negative household impact is applied to account for the cost of the initiative to taxpayers. For every dollar in additional reimbursement offered through the Initiative, economic impacts to the state increase by $1.54. However, at least 65% of the increase in local spending must represent new sales to final demand to ensure a benefit cost ratio above unity.
Higher member heterogeneity improves cooperative performance? Evidence from cooperative unions in China
Huang, Bin; Schmit, Todd M; Kong, Xiangzhi (2022)
This paper constructs a new conceptual framework around the impacts of member heterogeneity on cooperative union (federated cooperative) performance considering both a union’s capital factor structure and its service link operations structure, and that governance control rights serve as an integrated, additive influence. The framework is tested empirically with a large sample of cooperative union data from government sources and detailed case study interviews. We find that the influence of factor heterogeneity is resilient and positive when accounting for service link heterogeneity; however, excluding service link heterogeneity biases upwards expected union performance, particularly in less developed, poor regions in China. We also find democratic control rights is a key mechanism through which the heterogeneity of members affects the performance of the union. Our findings suggest that more detailed data in annual cooperative reporting will better identify the linkages and associations of union performance. In so doing, the results can better inform cooperative development priorities and governance processes to support sustainable development.
Ship-owner response to carbon taxes: Industry and environmental implications
Cariou, Pierre; Halim, Ronald A.; Rickard, Bradley J. (2022-05-10)
We consider the effects of a maritime bunker levy on ship-owner profits, trade, and emissions. Standard and augmented gravity models are employed using data from 2016 to estimate the impact of a change in transit time and transit cost on grain and soybean trade flows and on vessel speed. Results for a bunker levy of 50 USD/tonne of fuel, or less, stress that it will not trigger a change in the optimal speed of the vessel which is contrary to most theoretical models that predict an increase in fuel costs will always lead to a reduction in speed and carbon emissions. For markets where the shipowners pass the tax on to final consumers, it is also optimal to keep the same speed (and transit time) as long as the tax is equal to, or less than, 100 USD/tonne. Bunker levies exceeding 100 USD/tonne may be needed to reduce carbon when trade flows are sensitive to trade costs and transport time, as may be the case for many agricultural commodities.
The Coming Battle of Digital Currencies
Cong, Lin William; Mayer, Simon (2022-03-15)
We model the dynamic global competition among national fat currencies, cryptocurrencies, and Central Bank Digital Currencies (CBDCs) in which the strength of a country and of its currency are mutually reinforcing. The rise of cryptocurrencies hurts stronger fat currencies, but can beneft weaker fat currencies by reducing competition from stronger ones. Countries strategically implement CBDCs in response to competition from emerging cryptocurrencies and other currencies. Our model suggests the following pecking order: Countries with strong but non-dominant currencies (e.g., China) are most incentivized to launch CBDC due to both technological frst-mover advantage and potential reduction in dollarization; the strongest currencies (e.g., USD) beneft from developing CBDC early on to nip cryptocurrency growth in the bud and to counteract competitors’ CBDCs; nations with the weakest currencies forgo implementing CBDCs and adopt cryptocurrencies instead. Strong fat competition and the emergence of cryptocurrencies spur fnancial innovation and digital currency development. Our fndings help rationalize recent developments in currency and payment digitization, while providing insights into the global battle of currencies and the future of money.
The Global Inequality Boomerang
Kanbur, Ravi; Ortiz-Juarez, Eduardo; Sumner, Andy (2022-03-15)
In this paper we argue that the decline in global inequality over the last decades has spurred a ‘sunshine’ narrative of falling global inequality that has been rather oversold, in the sense, we argue, it is likely to be temporary. We argue the decline in global inequality will reverse due to changes in the between-country component. We find there is a potentially startling global inequality ‘boomerang’, possibly in the mid-to-late 2020s, which would have happened even if there were no pandemic, and that the pandemic is likely to bring forward the global inequality boomerang.
Engaged Learning: Mutual benefits for course instruction and Extension program delivery
Schmit, Todd M; Stamm, Richard; Severson, Roberta M. (2022-01-31)
Engaged learning projects can effectively complement Extension programming goals and course learning objectives that enrich the outcomes for both components. A cooperative business management class at Cornell University provides an evaluation of the fundamental principles, structure, finance, and governance associated with the cooperative business model. In so doing, students analyze contemporary issues facing modern cooperatives. In collaboration with extension programming surrounding cooperative enterprises, contemporary issues are emphasized through projects with actual cooperative businesses. Cooperatives have included farmer-owned, customer-owned, and worker-owned businesses. Students benefit from applying principles learned in class, while cooperatives benefit from the fresh, new perspectives they receive from people outside their organization. Both value the highly interactive nature of this engagement and to which work plans and expected deliverables can and often do change throughout the course of the projects. This paper synthesizes the opportunities and obstacles associated with developing and administering engaged learning projects from the learned experiences of the class instructor, professional Extension staff, and cooperative industry clients. Recommended best practices are elucidated to better inform faculty interested in implementing this dynamic approach to extension and classroom education.
Differential Economics Impacts for Cooperative Business Structures: Am Application to Farmer-Owned Cooperatives in New York State.
Schmit, T.M; Tamarkin, F.C.; Seversorn, R.M. (2021-12)
A comprehensive economic impact assessment using input-output methods is developed to account for localized spending activities and distributions of residual earning to member owners by cooperatives. The framework is applied to agricultural supply, service, marketing, farm credit, and rural electric cooperatives doing business in New York State. Detailed spending patterns from cooperative survey data reveal that agricultural cooperatives in the state have higher levels of localized spending when compared to average industry firms using aggregate industry data and equivalent levels of direct industry output. Accordingly, total economic impacts for these cooperatives; i.e., the direct, indirect, and induced effects, are larger. Overall, agricultural cooperatives contribute 7%, 3%, and 10% more total impact with respect to jobs, labor income, and output in New York State. Limitations to the enumeration of total impact to local economies are discussed and directions for future research that encompass more than current economic impacts are proposed.

Browse

Recent Submissions