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The principal chemicals used by Western Australia’s horticultural industries for field control and post-harvest disinfestation procedures for Mediterranean fruit fly are soon to be withdrawn from use due to public health concerns. When this occurs, the necessary switch to alternative control methods such as bait sprays and intensive fruit fly trapping will involve additional producer costs. Given these costs, this paper evaluates the option of eradicating Mediterranean fruit fly from the State and discusses possible cost sharing arrangements between government and industry that could be reached for mutual benefit.

The principal chemicals used by Western Australia’s horticultural industries for field control and post-harvest disinfestation procedures for Mediterranean fruit fly are soon to be withdrawn from use due to public health concerns. When this occurs, the necessary switch to alternative control methods such as bait sprays and intensive fruit fly trapping will involve additional producer costs. Given these costs, this paper evaluates the option of eradicating Mediterranean fruit fly from the State and discusses possible cost sharing arrangements between government and industry that could be reached for mutual benefit.

The principal chemicals used by Western Australia’s horticultural industries for field control and post-harvest disinfestation procedures for Mediterranean fruit fly are soon to be withdrawn from use due to public health concerns. When this occurs, the necessary switch to alternative control methods such as bait sprays and intensive fruit fly trapping will involve additional producer costs. Given these costs, this paper evaluates the option of eradicating Mediterranean fruit fly from the State and discusses possible cost sharing arrangements between government and industry that could be reached for mutual benefit.

The principal chemicals used by Western Australia’s horticultural industries for field control and post-harvest disinfestation procedures for Mediterranean fruit fly are soon to be withdrawn from use due to public health concerns. When this occurs, the necessary switch to alternative control methods such as bait sprays and intensive fruit fly trapping will involve additional producer costs. Given these costs, this paper evaluates the option of eradicating Mediterranean fruit fly from the State and discusses possible cost sharing arrangements between government and industry that could be reached for mutual benefit.

This paper develops the key finding of Hogan, Ozanne and Colman (2000) that risk aversion among farmers ameliorates the moral hazard problem in relation to agri-environmental policy compliance. It is shown that risk averse farmers who face uncertainty in their production income are more likely to comply with such a policy as a means of risk management. In addition, it is shown that a principal who has control over both the level of monitoring and the size of penalty if detected can reduce non-compliance by adjustments to these instruments which increase the variance of farmers’ income but leave the expected penalty unchanged. It is concluded that risk management by both principals and agents has the potential to diminish the moral hazard problem, especially given proposed developments in agri-environmental policy in the European Union.

This paper develops the key finding of Hogan, Ozanne and Colman (2000) that risk aversion among farmers ameliorates the moral hazard problem in relation to agri-environmental policy compliance. It is shown that risk averse farmers who face uncertainty in their production income are more likely to comply with such a policy as a means of risk management. In addition, it is shown that a principal who has control over both the level of monitoring and the size of penalty if detected can reduce non-compliance by adjustments to these instruments which increase the variance of farmers’ income but leave the expected penalty unchanged. It is concluded that risk management by both principals and agents has the potential to diminish the moral hazard problem, especially given proposed developments in agri-environmental policy in the European Union.

This article extends the analysis of the impact of a system of protein premiums and discounts to that on a farmer’s planned production. Despite an unambiguously negative impact on expected profits of equally likely premiums and discounts, supply response to the introduction of such a system is shown to depend on the level of seasonal variability faced by the farmer. In particular, farmers in regions which are more seasonally unreliable are likely to feature a negative supply response, whereas those in regions which are more seasonally reliable are likely to feature a positive supply response. Consequently, it is suggested that, overall, protein payments for wheat may have encouraged a shift of wheat‐growing activity away from more seasonally unreliable areas.

This article extends the analysis of the impact of a system of protein premiums and discounts to that on a farmer’s planned production. Despite an unambiguously negative impact on expected profits of equally likely premiums and discounts, supply response to the introduction of such a system is shown to depend on the level of seasonal variability faced by the farmer. In particular, farmers in regions which are more seasonally unreliable are likely to feature a negative supply response, whereas those in regions which are more seasonally reliable are likely to feature a positive supply response. Consequently, it is suggested that, overall, protein payments for wheat may have encouraged a shift of wheat‐growing activity away from more seasonally unreliable areas.

This article investigates the impact of a protein premiums and discounts system on the income stream from growing wheat. Based on a biological relationship between protein and yield in uncertain seasonal conditions, it shows that such a system reduces the expected level and variability of wheat income. It is subsequently argued, using a numerical analysis, that protein payments affect both the attraction to wheat growers of forward contracts and the value of land used for wheat. The nature of both of these impacts is related to the level of seasonal variability affecting the land. Consequently, wheat growers in the more unreliable regions of the wheatbelt may have been particularly disadvantaged by the system.

This article investigates the impact of a protein premiums and discounts system on the income stream from growing wheat. Based on a biological relationship between protein and yield in uncertain seasonal conditions, it shows that such a system reduces the expected level and variability of wheat income. It is subsequently argued, using a numerical analysis, that protein payments affect both the attraction to wheat growers of forward contracts and the value of land used for wheat. The nature of both of these impacts is related to the level of seasonal variability affecting the land. Consequently, wheat growers in the more unreliable regions of the wheatbelt may have been particularly disadvantaged by the system.

Farmers in the high rainfall region of Western Australia are able to obtain agricultural information and incorporate this information into their production systems. As a result risk associated with this production may alter. To determine the benefits of this change, farmers were asked to directly value the information that they received by using questionnaires based on the contingent valuation method (CVM. These valuations combined with additional data collected from the questionnaires were incorporated into profit functions and farmers' attitudes towards risk were estimated. It was hypothesised that these estimations would be consistent With the Australian literature and would therefore be valid and reliable. Results showed that generally farmers' risk aversion coefficients, estimated using their valuations for the information that they used, were small and so comparable to other recorded findings. It may therefore be argued that farmers were able to nominate valid and reliable valuations for the information that they used.