22pgs, We introduce the “coordination frontier” (CF), a simple practical tool to assess the likelihood of success of voluntary coordination in situations where, ex ante, the collective action solution provides an appealing alternative (e.g., for pest and disease control). We demonstrate the value of information conveyed by the CF, explain how to construct the CF from experimental data, and show how to apply the CF in practice. We illustrate the concept with an application to data from a framed field economic experiment, which was designed to elicit the preferences of Florida's citrus growers regarding their willingness to coordinate actions to combat citrus greening disease. This is a highly relevant case study not only because of the significant impact caused by citrus greening on Florida's citrus industry but also because a voluntary area-wide pest management program to control it had been established in 2010 and eventually failed; a similar program is now in place in California, where the disease spread is at an earlier stage. Had the CF been available in Florida, estimates of the (aggregate) chances of successful coordination could have been shared with growers to update their beliefs regarding the chances of successful coordination to help reduce strategic uncertainty. Policymakers in California could use the CF in such way and devise ways to encourage participation to increase the chances of reaching a desired coordination threshold.
22 pages, This paper presents direct evidence on the impact of a specific extension program that is aimed at promoting the adoption of varieties resistant to the soybean cyst nematode (SCN), specifically the Iowa State University SCN-Resistant Soybean Variety Trials. We use two data sources: experimental data from these variety trials and a rich proprietary dataset on farmers’ seed purchases. Combining these data, we estimate the value of soybean cyst nematode-resistant variety availability, and the associated variety trials that provide information on their performance to farmers and seed companies. Given the scope and diffusion of this extension program, the focus of the analysis is on Iowa and northern Illinois over the period 2011–2016. Farmers’ seed choices are modeled in a discrete choice framework, specifically a one-level nested logit model. Using the estimated demand model, we find farmers’ marginal willingness to pay for soybean cyst nematode-resistant varieties, and for related extension information provided by the Iowa State University SCN-Resistant Soybean Variety Trials program, to be large. These results are confirmed by counterfactual analyses showing that, over the six-year period and region of the study, the total ex post welfare change associated with the existence of, and information about, SCN-resistant seeds is about $478 million. About one-third of this surplus is captured by seed suppliers, and two-thirds accrues to farmers.
