Performing Department
Agri & Resource Economics
Non Technical Summary
Economic growth starting in 2000 followed by the recession beginning in 2008 has exerted substantial changes on land ownership, investment, agricultural production and the demand for Arizona's crops and livestock products. During the same time, water scarcity continues to influence and constrain how land is used and where agricultural production is favored. Non-Indian and Indian water rights and use figure prominently in determining the future of Arizona agricultural production and natural resource use. Formulation of public policy must account for the dynamic, uncertain range of technical and economic impacts on Arizona agriculture.
Animal Health Component
0%
Research Effort Categories
Basic
0%
Applied
80%
Developmental
20%
Goals / Objectives
1. Continue to develop and evaluate cost-effective alternatives for generating cost of production budgets for Arizona agricultural businesses while disseminating these budgets through innovative means via Cooperative Extension.2. Use cost of production budgets to analyze the impacts of changing input costs, product prices, technology, and legislation on Arizona's agricultural businesses, including farmers, ranchers, nursery operators, and food processing operations.3. Build theoretical and empirical microeconomic models accounting for risk and dynamics in the economic environment; and employ these models for explaining and predicting economic adjustments by producers to volatile, uncertain markets and policy interventions.4. Build and validate empirical models of futures, options, and commodity spot markets to analyze and devise strategies for hedging against risks and volatility.5. Build and validate empirical models capable of examining the impacts of policies--agricultural, energy, and macroeconomic--on Arizona agricultural producers; and incorporate highly infrequent events such as food safety breaches and natural disasters on the profitability and long-run viability of Arizona agricultural producers.
Project Methods
Efforts fall into two categories: data collection and data analysis. Data collection for production budgets requires careful attention to source of data, its reliability, and cross-checking for validity and plausibility. Consolidation among input suppliers, custom operators, and farm labor contractors makes survey methods inappropriate because low willingness to share proprietary data leads to inadequate response rates. Primary data collection involves time-consuming interviews both inperson as well as by phone.Data collection for econometric models of Arizona crops and livestock requires careful compilation of data from secondary sources such as National Agricultural Statistics Service and Economic Research Service. Supplementary data from other sources including weather and climate data require extensive investigation of available data sources with their relative advantages and disadvantages for coverage, reliability, and cost-effective access.Data collection for econometric models of water demands parallel that just mentioned though sources of data on surface and groundwater use must be identified and cross-checked for compatibility.Data analysis, primarily through econometric methods, requires careful model specification, extensive hypothesis testing, out-of-sample forecasting and validation, as well as careful synthesis of results for both technical and lay audiences.Knowledge generated will be transmitted through a variety of extension outlets including workshops, conferences, and extension publications coupled with web access.Evaluation requires identifying milestones for these projects. Data collection is ongoing even while data analysis is being conducted because forecasting models must be updated. For the econometric modeling aspects, major milestones will be publication of results in scientific journals, posting of results on websites, and presentation of results to various stakeholder groups.