Premium
Capturing Experts' Uncertainty in Welfare Analysis: An Application to Organophosphate use Regulation in U.S. Apple Production
Author(s) -
Roosen Jutta,
Hennessy David A.
Publication year - 2001
Publication title -
american journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.949
H-Index - 111
eISSN - 1467-8276
pISSN - 0002-9092
DOI - 10.1111/0002-9092.00145
Subject(s) - production (economics) , bayesian probability , welfare , expert opinion , econometrics , quality (philosophy) , probability distribution , economics , public economics , environmental economics , computer science , microeconomics , statistics , mathematics , epistemology , intensive care medicine , market economy , artificial intelligence , medicine , philosophy
The use of organophosphate insecticides in apple production has become of regulatory concern since the Food Quality Protection Act passed into law in 1996. Through an expert opinion survey, we assess the economic impact of possible regulatory scenarios on the apple industry. Because experts are unsure of the impacts, we ask them for distributions of impacts to explicitly capture the uncertainty they face. We apply Bayesian methods to aggregate these distributions. Welfare impact distributions for different policy scenarios are estimated and ordered using a nonparametric test for stochastic ordering of probability distributions to facilitate policy decision making.