David K. Lambert’s research while affiliated with North Dakota State University and other places

Bid prices were elicited for standard-label cookies, muffins, and potato chips and those guaranteed to be free of genetically modified (GM) ingredients using an nth price Vickery experimental auction. A non-GM guarantee increased bids over those offered for standard-label products using paired-samples t-tests. However, product labeling did not significantly effect bid price estimated using standard ordinary least squares. Overall, providing information about the positive or negative impact of biotechnology on the environment did not affect the bid for the standard—labeled (presumed GM) product. An exception was among students with an agriculture major for whom positive (negative) information decreased (increased) bids for GM products.

Scientific inquiry is increasing our knowledge of plant and animal genomics. The ability to specify heterogeneous production processes, to sort agricultural inputs by genotype, or to guide breeding programs to satisfy specific markets based on genetic expression may potentially increase producer and consumer benefits. This research develops a decision analysis framework to assess the expected value of genetic information. Expected returns are evaluated both in the presence of, and without, genetic trait information. Potential gains in the value of information can be quantified as research unravels the linkages between genetics and crop and animal performance and quality. An application to cattle feeding indicates potential gains to developing markets for specific animal genetic characteristics based on the amino acid sequence of the leptin gene.

Introduction: This report provides an overview of the important factors affecting investments in agricultural value-added ventures. The introductory section outlines current research on factors important in the location of economic activity. Research applied to specific agricultural value-added ventures, such as food manufacturing and livestock feeding and finishing operations, are discussed. A listing of resources available to entrepreneurs considering value-added investments concludes the introductory section. Following the introductory section are short overviews of industries that already have, or may have, potential for increasing economic activity in the state. All are based on the important foundation of agriculture in the state's economy or upon the natural resource base giving the state a comparative advantage in investments in alternative energy or resource-based recreation.

Teaching efficiency is investigated for the nine departments in the College of Agriculture, Food Systems, and Natural Resources at North Dakota State University. Using Data Envelopment Analysis, departments are compared to their College peers in converting teaching faculty and teaching funds into three teaching outputs: student credit hours generated, undergraduate majors, and graduate students. Most departments are efficient in the technical conversion of inputs to outputs under variable returns to scale. Scale effects are evident, indicating some departments consistently extract higher average productivity from inputs in servicing undergraduate majors, graduate students, and in generating student credit hours.

Markets for agricultural products may be inefficient when signals do not adequately reflect product characteristics important to market participants. Preferences can be explicitly reflected in price premiums for measurable characteristics using hedonic methods. However, when product quality information is costly to obtain, the problem is compounded. Bundling of quality traits by variety can serve to signal product quality. A procedure is developed to derive the value of different varieties in meeting buyer demands. An application to the hard red spring market wheat illustrates the use of a procedure to distinguish among varieties and provides empirical support for the existence of Akerlof's lemon market in the release of wheat varieties.

Increased international trade can affect production costs by promoting changing input and output prices and by promoting technological innovation. Econometric results suggest increasing state exports of agricultural products and rising US/Canada agricultural trade has shifted production costs from labor and material inputs towards capital and land and that trade-induced technological improvements have driven down production costs in the Great Plains.

Bid prices were elicited for standard-label cookies, muffins, and potato chips and those identified as not including genetically modified (GM) ingredients using an experimental auction. Including a statement that the product did not include GM ingredients increased bids over those offered for standard-label products. Providing negative-biased information about the impact of GM crops on the environment increased the risk participants associated with GM foods, and positive-biased information decreased perceived risk. Overall, providing impact information, whether positive- or negative-biased, increased bids for products presumed GM. The influence of information bias on bids varied among selected participant groups, supporting the presence of uniquely responsive market segments.

Co-products of processing agricultural commodities are often marketed through private transaction rather than through public markets or those in which public transaction information is recorded or available. The resulting lack of historical price information prohibits the use of positive time series techniques to estimate demand. Demand estimates for co-products are of value to both livestock producers, who obtain them for use in livestock rations, and processors, who must sell or otherwise dispose of them. Linear programming has long been used, first by researchers and later as a mainstream tool for nutritionists and producers, to formulate least cost livestock rations. Here it is used as a normative technique to estimate step function demand schedules for co-products by individual livestock classes within a region. Regression is then used to smooth step function demand schedules by fitting demand data to generalized Leontief cost functions. Seemingly unrelated regression is used to estimate factor demand first adjusted for data censoring using probit analysis. Demand by individual livestock classes is aggregated over the number of livestock within a region. Species important to demand for each co-product are identified and own price elasticity for individual livestock classes and all livestock are estimated.

Markets for agricultural products may be inefficient when signals do not adequately reflect product characteristics important to market participants. Although preferences can be explicitly stated through price premiums or characteristic values can be determined via hedonic methods, the problem is compounded when product quality information is costly to obtain. Bundling of quality traits by variety can serve to signal product quality. A procedure is developed in this paper to derive the value of different varieties in meeting buyer demands. An application to the hard red spring market wheat both validates the ability of the procedure to distinguish among varieties, as well as provides empirical support to the existence of Akerlof's lemon market in the release of wheat varieties.

Nevada ranks third in the world in gold production. In order to operate the massive open pit gold mines, the State of Nevada granted mining companies a temporary permit to pump groundwater from near the open pits and dispose of it. Certain instream flows have nearly doubled relative to average historical flows in recent years. Following pit closure, surface flows will likely decline from historical levels. This study measures the impacts of these changing water supplies on downstream agricultural and recreational users. We argue that the creation of temporary changes in water rights for the downstream users would likely mitigate future losses both groups are expected to experience.