The influence of behavioral mechanisms and economic conditions underlying population mobility decisions is critical during periods of environmental change. We investigate the extent to which drought-induced increases in risk aversion and reductions in economic wellbeing shape the migration decisions and remittance receipts of rural households surveyed as part of the Thailand Vietnam Socio Economic Panel from 2007-2017. We integrate monthly high-resolution () rainfall and () temperature data from the Global Precipitation Climatology Centre and the GHCN Gridded V2, respectively, to characterize severe droughts. We find that consecutive years of severe drought decreases household engagement in migration by 3.4 percentage points and reduces remittance revenue by 13.7 percent. We show that consecutive severe droughts substantially increase risk aversion and erode economic wellbeing. Analysis of underlying mechanisms and heterogeneity highlights the mediating influence of economic wellbeing measured as per capita consumption, and suggests that the migration outcomes of wealthier households are less sensitive to the adverse effects of droughts. This pattern of results is consistent with the presence of an environmentally-induced poverty trap, whereby exposure to climate shocks directly and indirectly (through increases in risk aversion and reductions in consumption) reduces rural population mobility, particularly among poorer households.

We consider the interaction between an upstream seller (e.g. retailer) and downstream buyer (e.g. representative consumer) over two periods. The seller stocks inventory at the beginning of the selling horizon and marks down the goods in the second period. The buyer, who faces consumption uncertainty, stocks inventory in the first period and carries all excess inventory over to the second period, during which he can replenish again. In the case of stock-outs, the buyer can expedite demand from an alternative source at a higher cost. Both agents incur waste cost for all excess inventory at the end of the second period. We first characterize stocking decisions of a myopic buyer who considers the two periods independently. We then analyze those of a forward-looking buyer, who takes into account the markdown mechanism, and find that the forward-looking buyer stocks more in the first period compared to the myopic buyer. The first period stocking decision of a forward-looking buyer is characterized by a threshold below which his stocking decision is relatively low, allowing him to ignore the waste cost, and above which it the stocking level is higher but captures the waste cost thereby dampening the exposure to waste at the end of the second period. Lastly we consider a sophisticated buyer who additionally accounts for potential stock-outs at the seller. We characterize the sellers stocking decisions and derive conditions under which she will stock sufficiently many units so that forward-looking behavior is enough and the buyer does not face stock-outs. The seller stocks more units when buyers are forward-looking than myopic. Finally, we look into policy implications by imposing waste cost on the buyer and seller alike to assess which of the instruments is more effective in reducing waste.

This work is in collaboration with Nicole Perez Becker and Joachim Arts.

Governance of Digital Sequence Information and Impacts for Access and Benefit Sharing

Diego Maximiliano Macall
Agricultural & Resource Economics  

The decoupling of biological information from its material source has changed the global debate about access and benefit sharing (ABS) of genetic resources. What does the digitization of biological information mean for genetic resources of proven and potential value? What implications does DSI have for individuals and groups who have invested time and effort in augmenting and refining valuable characteristics in genetic resources? Through the lens of access to genetic resources for crop/plant breeding, this presentation explores the options for governments to continue advancing the goals of access and benefit sharing, when physical access to genetic resources is needed less because DSI is readily accessible. With clearly divergent political and economic interests, and without a universally accepted definition for genetic resource, a wide array of entities are currently engaged in trying to govern ABS. The four options will be presented that could begin to address the governance challenge are detailed and explained.

Richard Gray, Devin Serfas & Seraina Giovanoli
Agricultural & Resource Economics

In 2015, the passage of the Agricultural Growth Act made Canada compliant with the UPOV 91 convention by strengthening plant breeders’ rights. In an effort to use this framework to increase crop royalties, two proposed funding models; 1) End Point Royalties and 2) Farm Saved Seed Royalties are currently part of a national consultation process. At this point in the consultations, producers have identified a number of inherent risks in these funding models and have generally been reluctant to support any changes to the current system. In the first part of our analysis, we examine royalty systems in Australia, France, the United States, and the United Kingdom, comparing the outcomes. In the second part of our analysis, we address each of the potential risks identified by producers and explore policy options that could be used to mitigate these risks.

Jeff Holzman, MSc
Senior Director, Investor & Corporate Relations, Nutrien
Nutrien was formed in 2018 and is one of the largest global agricultural companies with significant
operations in Saskatchewan. The seminar will provide an overview of Nutrien’s business, strategy and an
outlook for global crop input fundamentals.

Dr. Peter Boxall
Professor, Department of Resource Economics & Environmental Sociology
University of Alberta 

Conservation auctions are employed to seek improved levels of environmental quality. Two well-known auction designs often employed are the discriminatory (pay as bid) option or the uniform bid option, where prices are typically set by the highest accepted or lowest rejected bid. In theory, the relative efficiency of these two formats can differ because bidders in the discriminatory design seek higher information rents than in the uniform setting. While this can be shown in the laboratory, bidder behaviour in actual real-world auctions has to our knowledge not yet been explored. In this paper, rent-seeking behaviour is examined in one discriminatory and two uniform real-world auctions used to secure impacted wetland basins for restoration on Canadian prairie agricultural landscapes. We provide evidence that information rents sought by landowners bidding in these auctions to be higher among participants in the discriminatory auction which conforms to theoretical predictions. 

Dr. Rim Lassoued
Professional Research Associate,Agricultural & Resource Economics

Food insecurity is one of the biggest global challenges. Science and technology provide prac-tical solutions that can help meet rising global food demand through sustainable intensifica-tion of agriculture. The application of new plant breeding techniques (NBTs) including genome editing is an effective and timely solution that provide technical and economic advantages over conventional breeding. Yet, the development of crops derived from these techniques largely depend on regulatory systems and social acceptance.
A multiyear survey project has been operational since 2015, investigating expert opinion on the opportunities and challenges surrounding the development of NBTs. A key finding is that regulatory issues, social, and environmental concerns are critical to the success of NBTs. Re-gional heterogeneity exists between Europeans and North Americans, particularly regarding political attitudes and social perceptions of targeted breeding techniques.

AREC 990
Kathy Larson
Research Associate, Agriculture and Resource Economics

The adage “you cannot manage what you do not measure” is applicable to many situations. In cow-calf production, it has been used to stress the importance of record keeping, cost of production analysis and adoption of recommended management practices. In her former role as economist with the Western Beef Development Centre, Larson spent several years collecting production and financial data from cow-calf operations to generate annual cost of production benchmarks. In providing options to producers on how to reduce their cost of production, she often directed them to consider ways to increase their primary output (pounds of weaned calf). Increasing pounds of weaned calf, without adding more cows, is achieved through improved productivity (e.g. increased conception rate, reduced calf death loss, improved calving distribution) and adoption of recommended practices (e.g. pregnancy checking, feed testing, vaccinating).  Recommending areas for improvement first requires knowing what producers are doing, which is why in 2014 Larson collaborated with 12 other individuals representing provincial governments, producer associations and research organizations from BC to Manitoba to revive a production survey last conducted in 1998. The survey is known as the Western Canadian Cow-Calf Survey (WCCCS). Results have been used to establish adoption rate and production indicator benchmarks, promote the industry and guide research and extension efforts. In 2017, the WCCCS was carried out again as were sister surveys in Ontario, Northern Quebec and Atlantic. Larson will share results from the 2017 Western Canadian Cow-Calf Survey plus provide highlights from the sister surveys in Ontario and Atlantic Canada.