A study was undertaken to investigate the macro production relationships in Canadian primary agriculture during the 1935-65 period. Specifically, the problem was to measure simultaneously the rate of disembodied technological change and technological change embodied in machinery and implements, and material inputs. To estimate technological change, regression estimates were obtained for a linear homogeneous Cobb-Douglas production function, where real gross agricultural output per person employed was the dependent variable, and a time index, weather index, and the annual flow of real capital services (including material inputs) per person employed were the independent variables. The data, which consisted of time series of thirty-one annual observations, was derived mainly from publications of the Dominion Bureau of Statistics. The rate of disembodied technological change was estimated directly by specifying a term which allowed for shifts in the production function over time. To measure the rate of embodied technological change, which was assumed to be capital-augmenting in the vintage sense, several alternative values for the improvement in the productive quality of machinery and implements, and material inputs were imposed on the original data series. Based on these alternatives, a matrix of regression results was obtained, and the true value of the rate of embodied technological change was inferred by choosing the "best" regression. In addition, several alternative models were investigated. When disembodied and embodied technological change were specified simultaneously, the "best" estimate of the annual rate of disembodied technological change was 1.76 per cent, while embodied technological change in material inputs was estimated at 3.5 to 4.0 per cent annually. There was no evidence of a positive rate of embodied technological change in machinery and implements in any of the regressions. However, it was concluded that this a priori unexpected result should be considered substantially biased. / Land and Food Systems, Faculty of / Graduate

In January 1985, the Canadian Grain Commission licensed a medium quality wheat cultivar, HY320, for production within the new classification "Prairie Spring Wheat". Field trials conducted between 1974 and 1985 have shown that HT320 outperforms Neepawa, a traditional hard wheat variety, by 25 to 30 percent on average. The objective of this study is to examine the impact of this new high yielding variety on production opportunities and incomes for prairie grain farmers and to estimate the share of grain exports that it may command in the future. The study will also provide an estimate of the supply curve for HY320. A linear programming model is developed in which the country is divided into 29 crop regions (22 of which are located in the prairie provinces) and 7 livestock regions for which aggregate activities and constraints are defined. The activities can be divided into three major groups: production, shipping, and marketing activities. The model is sector-wide in the sense that it describes domestic supply and use of major crop and livestock commodities in Canada. The problem is to determine the level of agricultural production which maximizes net returns to the agricultural sector subject to constraints facing the sector. Medium quality wheat is initially introduced into the model by allowing it to compete directly with hard wheat for cropland allocated to wheat production. There is also a limited capacity in the model for the new variety to replace other feed grains and oilseed crops. This constraint was later relaxed in the study. Prices of traditional crops were set at their 1984-85 level based on Thunder Bay. As little medium quality wheat has been sold by the Canadian Wheat Board, there is considerable uncertainty concerning its ultimate price. Consequently, the analysis was performed at eight specific prices between $135/tonne (the lower range for American and Australian medium quality wheat traded on the world market) and $170/tonne (the final realized price for HY320 in 1984-85). These limits correspond to prices of 0.72 and 0.91 relative to the 1984 blended price of high quality wheats ($186/tonne). Results show that although total wheat acreages increase marginally over the price range, class composition changes dramatically. The percentage of medium quality wheat increases from 10% at $130/tonne to 94% at $170/tonne. As the price rises, the new variety becomes profitable to farmers in an increasing number of crop regions. The critical relative price for most regions is between 0.78 and 0.83. When the price is $140/tonne, the new variety is grown in a band from east central Saskatchewan to west central Manitoba. At $160/tonne, it is grown in all prairie regions except in the brown soil zone of south-east Alberta and south-west Saskatchewan. As the price of the new wheat rises, total wheat exports increase, although the quantity of hard wheat exported declines. When the price is $135/tonne, wheat exports, which are up by 5%, consist of 6% medium quality wheat and 94% hard wheat. At $170/tonne, wheat exports have risen by 37%, and 98% of these exports are medium quality. The results indicate that the adoption of the new wheat has a negative impact on the production and export levels of all other grains. Over the price range examined, the increase in net farm income of prairie grain producers varies from $9 million to $715 million. Clearly, any estimate of income effects is sensitive to assumptions regarding relative grain prices. Based on the price of U.S. and Australian medium quality wheat varieties, as well as on market share considerations, the author feels that the export price of Canadian medium quality wheat will be at the lower end of the price range examined, possibly between 0.72 and 0.80 the price of hard wheat, implying gains between $9 million and $155 million for prairie grain producers. Finally, the results of the study have implications for wheat licensing arrangements, marketing strategies, the grain delivery system, the transportation rate structure, farm assistance programs, and the direction of future research. / Land and Food Systems, Faculty of / Graduate

This thesis provides a comprehensive treatment of agriculture in Canada as examined from the viewpoint of modern production theory. This theory has it's origins in Hicks (1946) who developed the implications of profit-maximizing behavior in the context of a multiple input, multiple output technology. The main body of the thesis is divided into three major papers. In the first paper we provide a comprehensive overview of the concepts and methodology which have been employed in making observations of agricultural production during the period 1926-1970. In the second and third papers of the thesis we apply the previously analysed data base to the problem of measuring the rate of increase in total factor productivity during the post-war period and to estimating the internal structure of agricultural production during the post-war period. The second paper is devoted to measuring the growth in total factor productivity during the post-war period. Two problems are explicitly examined: i) the calculation of rental prices or user costs for durable inputs (see Jorgenson and Griliches (1967) (1972), Diewert (1972) Section VI "Producer Behavior when Depreciation Rates are Variable", and King (1974)) and (ii) the aggregation of the numerous inputs and outputs (see Jorgenson and Griliches (1972) and Diewert (1974a)). In the third paper, the data base is applied to the problem of modeling and estimating empirically a multiple-output production function for the Canadian Agricultural Sector. This study not only provides insight into the internal structure of production within the agricultural sector, but also allows many of the assumptions and implications of the neoclassical theory of production to be tested empirically. In each of the applications the results achieved are directly related to the accounting framework by which the various inputs and outputs are measured and to the way in which the data has been handled. Thus a major concern in the applications sections is with possible ways by which the data and the studies may be improved. / Arts, Faculty of / Vancouver School of Economics / Graduate

This thesis is concerned with questions relating to the optimal regulation of logging in a solely owned forest. Optimal is taken to mean maximizing the present value of net revenues obtainable from growing and harvesting an infinite sequence of crops on a piece of forest land. Discussions of optimal harvesting usually assume there is no advantage to changing the age distribution of a forest. This is also the assumption of Chapter I. In this case, trees are cut when their age reaches the rotation period which is determined from what is called the Faustmann formula. Chapter I looks at the comparative statics of these rotation periods. The effect of a change in an exogenous parameter on the rotation period is shown to depend on how certain elasticities are changed. It is then shown that there are conditions under which these results extend to a more complex forestry model where the manager chooses the level of effort to be expended on regeneration and silvicultural activities. The techniques used are drawn from optimal control theory. Chapter II introduces considerations which may make it advantageous to alter the age structure of a forest while logging it. In particular, a variable average cost of harvesting function is allowed for. A forestry maximum principle is derived which determines the dynamics of optimal harvesting. This is similar to the maximum principle for processes incorporating a delay (the time between planting and harvesting). The usual growth theory questions are then asked. In the variable average cost case, the "steady state" age distributions turn out to be "normal" forests with the time between harvests being determined by a Faustmann formula Global asymptotic stability is not proven but is shown to be likely. Finally, Chapter III applies the forestry maximum principle to a problem of determining an optimal harvesting policy for a group of forests subject to a sustained yield constraint. Assuming stability and with a few additional restrictions, it is shown that the optimal long run policy is to convert each separate forest to a "normal" forest. The Faustmann formula determines the number of age classes in each forest. / Arts, Faculty of / Vancouver School of Economics / Graduate

This thesis explores problems of optimal investment arising in fisheries and other renewable resource industries. In such industries, two simultaneous investment problems must be addressed: investment in the resource stock (the biomass) and investment in the capital stock (harvesting capacity). Each of these investment problems faces a key complication; investment in the resource is constrained by the natural population dynamics, while in many cases investment in the physical capital stock suffers from irreversibility, since capital used in natural resource industries is often non-malleable. In addition, all investment decisions must be made within an uncertain environment; full information is never available. Building upon the work of Clark, Clarke and Munro (Econometrica, 1979), we develop a two-state two-control model which incorporates investment delays and stochastic resource fluctuations within a seasonal (discrete-time) framework. A dynamic programming approach is used to analyse the model heuristically and to obtain numerical results, beginning with a study of the ideal deterministic case and proceeding to a full stochastic analysis. The key assumption of irreversible investment is maintained throughout the thesis. We have examined the qualitative and quantitative effects on optimal investment strategies of several economic and ecological factors: (i) delays in investment, (ii) population dynamics parameters, (iii) selling price, (iv) capital cost and operating cost, (v) depreciation rate, (vi) discount rate, and (vii) the level of uncertainty in the resource stock. We have found that the key cost parameter for the investment problem is the ratio of unit capital costs to unit operating costs. Depreciation can play a rather counter-intuitive role; in some circumstances optimal investment levels can increase with the depreciation rate, contrary to the usual treatment of depreciation as an additional cost of capital. The introduction of uncertainty in the form of stochastic resource fluctuations can substantially change the optimal investment policy, but this tends to have little effect on the value of the fishery. We analyse the factors which determine the role of randomness in optimal fisheries investment, and discuss in some detail the implications for management. Solution of the stochastic optimization problem studied here requires the use of rather complicated numerical methods, which are described in detail in the thesis. These methods are quite general, and should prove useful in analysing other related stochastic models. / Science, Faculty of / Mathematics, Department of / Graduate

It is well recognized that there are imperfections in the market for knowledge transfer due to the nature of ideas and inventions. This is consistent with market failures commonly discussed in the economics of information literature. Some of the impediments to efficiency axe examined here in three essays—one empirical, one theoretical, and one case study—all of which share the theme of scientific knowledge movement. The first essay is empirical and measures the systematic effects of direct interaction and geographic distance between university and firm scientists on the economic performance of imported inventions. This study concludes that, with respect to licensing royalties, scientific interaction has an elasticity of approximately 3 at the mean, which is highly robust, and that distance does not have a significant effect after controlling for interaction. This suggests imperfections in the market for know-how that are sensitive to distance. The second essay is a case study of an invention from the area of robotics and control systems and augments the empirical work presented in the previous essay by illustrating specific reasons why interaction was important for the commercialization of one particular early stage invention. The third essay develops a game theoretic model involving the strategic manipulation of incentives by an incumbent to create an 'intellectual property commons' for the purpose of preventing the commercial development of a disruptive technology that would otherwise threaten existing industry margins. The strategy of spoiling incentives to commercialize public sector scientific inventions by eliminating exclusive intellectual property rights—the strategy of the commons—is motivated by a fear of cannibalization and supported by a credible threat. It is shown that the degree of cannibalization to which the new technology exposes the old market is responsible for this market failure. / Business, Sauder School of / Graduate

The pace of economic development in Uganda has been slow. National output has not increased fast enough. There has been evidence of a long-term deterioration in the terms of trade, elements of export instability and a serious stress in the balance of payments. Employment and rural development have been less than satisfactory. A possible strategy for alleviating these problems involves a more rational utilization of natural resources, of which the forestry sector is one. A review of the past performance of the forestry sector indicated that its contribution to the Gross Domestic Product was minimal, 2.1%. Furthermore, employment in forest management was small and unstable and imports of forest products have increased faster than exports. On the other hand, forest industries were labour-intensive, ranking second to the textile industry and contributing 10% of the total employment in manufacturing. The lack of a sound forest policy and a quantifiable production goal was identified as a possible cause of the poor performance. Forestry was relegated to the position of a handmaid to agriculture and the size of the national forest estate was limited to a minimum of 8% of the total land area of the country. If the forestry sector is to contribute substantially to economic development, it must be well planned. To achieve this the identification of optimum product-oriented management models for forest lands is necessary. By the year 2000 A.D. maximum consumption requirements 3 in million M were estimated to be 46.85 for fuelwood and charcoal, 2.89 for poles and posts, 1.0 3 for sawnwood and sleepers and 0.15 for wood-based panels; and 0.25 million metric tons for paper and paperboard. Based on roundwood supply projections at current levels of management and timber prices, the forest resource of Uganda will be unable to meet the anticipated demand by the year 2000. Increased utilization of the lesser-known species in the tropical high forests is a feasible medium-term strategy for avoiding timber scarcity. In addition, preliminary studies indicate that species such as Cyanometra alexandrii (CH. Wright) offer real promise in the export sector and should, therefore, be processed. However, for a much more sustained production with attendant improvements in quality and yield per hectare, a greater effort towards forest plantations is advocated. Five product-oriented softwood (Pinus patula Schl. Cham and P. caribaea Morelet var. hondurensis) management models were forumulated and tested for efficiency. Two of the models had close spacing (2200 stems/ha) with a light (IA) and a heavy (IB) thinning. Model IC had intermediate spacing (1800 stems/ha) with two heavy thinnings; ID with wide spacing (900 stems/ha) and a heavy thinning; and IE, the current management regime, has a wide/intermediate spacing (1370 stems/ha) with three thinnings. The "VYTL" simulation model developed at the Commonwealth Forestry Institute (Oxford) was used to produce yield tables for the management models. The models appropriate for Eucalyptus grandis (Hill) Maiden had already been adequately analysed elsewhere. In terms of efficiency, model IC had the highest mean 3 annual increment (29.4 M³/ha/year at age 20) and ID attained a mean dbh of 20 cm earliest, at age 11. Using the Faustmann formula and assuming a constant timber price (models IA, IB and IC) and a size-responsive revenue function (models ID and IE), the optimum rotations in years were 17 for IA, 19 for IB, 22 for IC, 27 for ID and 29 for IE. Substantial economies in the use of land can be achieved by adopting the appropriate management strategies. Model IA was best suited for pulpwood production and IE for veneer and saw logs. For an integrated pulpwood/veneer and saw log production, model IA was most suited if greater emphasis was on pulpwood and IC if the emphasis was on veneer and saw logs. Based on the revenue assumptions for the determination of rotation length, model IE had the largest amount of present net worth (U.shs 3374/ha at 6% discount rate) and ID, the highest internal rate of return (10.50 percent). When either the amount of initial capital outlay, or total cost compounded to rotation age required to produce a unit volume of wood was used to measure cost-effectiveness, model IE was the most efficient. Taking into account all these efficiency rankings, model IE was selected as the optimum product-oriented management strategy for veneer and saw log production, IA for pulpwood and IC for an integrated pulpwood/veneer and saw log production. Having identified the optimum management strategies, their implications for economic development in terms of foreign exchange earnings, investment requirements, employment and rural development were assessed. The greatest opportunities for foreign exchange earnings were in import-and product-substitution. The economic values of substitution locally produced softwood sawnwood for prime grade hardwoods on the domestic market and for imports of softwood sawnwood were estimated to be U.shs 1400 and 727 per M³ respectively. Direct or seedling credit schemes for eucalypt woodlot farms were recommended and will require a maximum investment of U.shs 1461 million and employ 183 thousand persons per annum. For softwood plantations, a maximum investment of U.shs 213 million and employing 62,000 persons annually will be needed. Due to the existence of an artificial surplus of land, a two-pronged strategy of forest area expansion and intensive management was considered optimal for Uganda. It was estimated that through adoption of the optimum intensive management models, the size of the national forest estate should be increased from the current 8% to about 17% of the total land area of the country to avoid future timber scarcity. To lessen the disparities in the standard of living among regions, industrial plantations should be located in economically depressed areas. A land availability index, expressed as a function of regional rate of land utilization, carrying capacity, actual population density and real per capita income was used to determine potential sites for establishing plantations. Those districts with land availability indices below the national average were considered economically depressed. They were Madi, West Nile, Acholi (East and West), Lango, Mubende and Bunyoro, in a decreasing order of severity. The last four offer greatest promise for plantation forestry. Finally, the management strategies identified in this study should provide the main basis for sound social cost-benefit analyses of forestry projects. It is hoped the projects will subsequently be adopted in the next development plan of Uganda. / Forestry, Faculty of / Graduate

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Call number: LD2668 .T4 1946 G8 / Master of Science