Author
Turvey, Calum G.
How would a possible food safety scare influence food consumption? Using techniques from experimental psychology, a study of 103 lunchtime participants suggests that a food scare–avian influenza–would decrease consumption of the affected food by 17% if the subjects believed it was naturally occurring, and by 26% if they believed it was the result of terrorism. While individual consumption decreased, very few eliminated all consumption of the affected food. We argue that experimental psychology is essential when attempting to study behavior in food safety where hypothetical scenarios and surveys would not capture the emotional nature of the response.
This study presents a new approach to the optimal hedging decision. In some empirical studies, the standard hedge using the mean-variance hedge ratio provides results which are inconsistent with downside risk management. The new approach taken here relates the optimal hedge ratio to semivariance rather than variance. An algorithm to solve for the minimum semivariance hedge is presented, and applied to hedging Kansas City wheat and Texas steers.
This article examines farm operating risks and cash-rent determination through the use of the efficient set mathematics. The efficient set mathematics proves to be a pragmatic approach to characterizing operating risks, and the relationships between operating risks and cash-rent determination. Various separation theorems are used to postulate the relationship between operating risk and cash rents. Preliminary evidence appears to support the theoretical conclusion that opperating risk and cash-rent determination are related.