RESEARCH UPDATEO k l a h o m a S t a t e U n i v e r s i t y • D e p a r t m e n t o f A g r i c u l t u r a l E c o n o m i c s • 2 0 1 4 I s s u e

Perceptions of Beef Cut QualityDo USDA quality grades provide

consumers clear information?

Electronic Medical Record Adoption Rates

Do rural-urban differences exist in Oklahoma?

Future ResearchAn insight to future research

of the department.

Welcome to the current issue of our departmental newsletter, the Research Update edition.

The research program in the Department of Agricultural Economics aims to create practical, empirical knowledge that will increase the efficiency and productivity of Oklahoma agriculture and rural communities as well as improve the well-being of Oklahomans.

Our faculty members address a vast array of topics through research. We intend for research results to serve producers, ranchers, policy makers, emerging and existing businesses, and the public. Research projects are determined by faculty members after reviewing current research efforts in our profession. We also utilize input from peers, clientele, collaborators, extension educators and funding agencies.

Featured research topics in this issue range from beef cut quality, to rural health care, to consequences of changes in local sales tax rates. All of these topics impact the quality of life for Oklahomans.

We also provide you some insights into future research activities of the department including efforts to assist small and medium-sized producers and businesses, impacts of oil and gas development on agricultural lands, and strategies for safeguarding water supplies. Finally, we list 41 peer reviewed articles published by our faculty members over the past year.

We hope you enjoy this issue and our new look.

2 • Welcome

From the Department Head’s Desk

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ISSUE About the Cover:

Do you know the differences between the quality grades of theses beef steaks? Read how consumers perceive beef cut quality in our feature story on page 4. Photo credit to Fred Minnick, http://fredminnick.com/buying-beef/raw-beef-steak/.

Photos to the right courtesy/credit of: The Beef Checkoff, www.BeefItsWhatsForDinner.com; Randi Williams; Fred Minnick, http://fredminnick.com/buying-beef/raw-beef-steak/; Erik Bauer, www.city-data.com; and Oklahoma State University.

CattlePerceptions of beef cut quality: Do USDA quality grades provide consumers clear information?

Community DevelopmentCounty revenue publications: Yearly compilations provide county financial information

Health CareElectronic medical record adoption rates: Do rural-urban differences exist in Oklahoma?

Rural EconomyConsequences of increasing local sales tax rates

Future Research An insight to future research of the department

Journal Articles2013 Journal Articles from the Department of Agricultural Economics

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Do USDA quality grades provide consumers clear information?The organized grading of beef by the federal government dates back to 1923, when a government agency—the U.S. Shipping Board—asked the U.S. Department of Agriculture to grade beef carcasses according to tentative U.S. standards to ensure a uniform quality in contract beef purchases.The Livestock and Seed Program of the USDA-Agricultural Marketing Service is responsible for developing, maintaining and administering current federal meat grading programs.

ResearchersJayson Lusk, Agricultural Economics Regents professor and holder of the Willard R. Sparks Endowed Chair, and Eric DeVuyst, Agricultural Economics professor and Extension economist, designed this study about individuals’ knowledge and perception of the quality of certain meat cuts.

IssuesBy some measures, the USDA beef quality grading program is a success. While beef grading is not compulsory, according to USDA-AMS, about 80 percent of all federally inspected beef slaughtered and 94 percent of steers and heifers slaughtered were quality graded in 2013. Despite the benefits of the system, the 2011 National Beef Quality Audit concludes that beef quality terminology is not clear in communicating beef quality to consumers. Research shows that consumers prefer the taste of higher marbling signaled in the current grading system and that consumers value quality grades when selecting steaks. However, it is not

clear that the current nomenclature conveys eating satisfaction and value information to consumers.

ObjectiveThe objective of this research is to determine the extent that USDA quality grades communicate marbling, juiciness and relative retail price information to consumers. This issue is critical to maintaining and increasing beef demand.If consumer quality expectations are not met, consumers are less likely to purchase beef in the future. If the beef sector fails to clearly communicate quality between segments, it is unlikely that the industry is providing clear quality information to consumers.

ProjectsTo determine the extent that USDA quality grades communicate information to consumers, two national surveys were conducted. The surveys assessed consumers’ knowledge of how USDA quality grades relate to leanness and juiciness. The surveys also assessed consumers’ knowledge by requesting they match pictures of ribeye steaks with quality grade names and relative prices.The questions analyzed in this study were taken from the Food Demand Survey (FooDS) project in the Department of Agricultural Economics at Oklahoma State University.FooDS tracks consumer preferences and sentiments on the safety, quality and price of food at home and away from home with particular focus on meat demand. This study analyzes three questions that were added to the November 2013 installment and one question added

qualityPerceptions of beef cut

Photo above, courtesy of The Beef Checkoff, www.BeefItsWhatsForDinner.com.4 • Cattle

2014 Research Update • 5

to the December 2013 installment. The analysis makes use of responses of 1,020 respondents to the November survey and 1,017 responses to the December survey.In the November survey, respondents were asked to rank USDA quality grades in terms of leanness and juiciness.The first question asked, “rank the following USDA beef quality grades in terms of LEANNESS with 1 being leanest and 3 being fattest.” Respondents then ranked these three grades, “Select,” “Choice” and “Prime,” on leanness.The second question asked, “rank the following USDA beef quality grades in terms of JUICINESS with 1 being juiciest and 3 being driest.” Respondents also ranked the same three quality grades. Respondents were also asked to match pictures of steaks (from grading cards) with their respective quality grade names. They were shown pictures of three steaks of varying marbling levels, and they were requested to “match the pictures of the beef ribeye steaks to their respective USDA quality grades,” of “USDA Prime,” “USDA Choice” or “USDA Select.” See the images below.In the December survey, respondents were asked to match pictures of the same ribeye steaks with the price they would expect to pay for each steak, $4 per pound, $8 per pound and $12 per pound.

ResultsResults reveal that the USDA quality grades have, at best, little meaning to consumers. Only 14.4%

of the respondents were correctly able to match the terms “Select,” “Choice” and “Prime” as the leanest, middle and highest fat content beef. Also, the USDA quality grades may actually mislead consumers regarding fat content.At first glance, consumers appear better able to translate USDA beef quality grades into relative juiciness. 32.6 percent of respondents correctly identified the ranking of the grades on juiciness. However, 57.1 percent of respondents indicated that “Prime” denotes the leanest beef, and 43.9 percent indicated that “Select” is the fattest beef. It is unclear whether respondents know (or guessed) the correct ranking on juiciness. It seems likely, given the incorrect ranking for leanness, that the term “Prime” denotes a superior product, and that consumers perceive leanness to be superior to fatness.When matching pictures of ribeye steaks to their appropriate quality grades, only 22.5 percent correctly matched the heaviest marbled steak to “Prime.” Similarly, only 24.2 percent were correctly able to label the least marbled steak as “Select.” Only 14.5 percent of respondents were able to correctly match all of the pictures to their appropriate USDA quality grade.When matching pictures of steaks to the prices they expected to pay, only 29.2 percent of consumers were able to correctly match the picture of the “Prime” steak to the highest price, with 54.8 percent indicating that it was the lowest priced steak. Similarly, only 49.5

Consumers tended to categorize these meats as select (3), choice (2) and prime (1), while their USDA grades are prime (3), choice (2) and select (1). Photo courtesy of Susan Murray.

Jayson LuskRegents Professor and Willard R. Sparks Endowed ChairOklahoma State UniversityDept. of Agricultural Economics411 Ag Hall, Stillwater, OK 74078Phone: 405-744-7465Email: jayson.lusk@okstate.edu

Eric A. DeVuystProfessor and Extension EconomistOklahoma State University Dept. of Agricultural Economics 530 Ag Hall, Stillwater, OK 74078Phone: 405-744-6166Email: eric.devuyst@okstate.edu

qualitypercent thought the picture of the “Select” grade steak was the highest priced, with 35.3 percent correctly matching it to the lowest price. Overall, less than one-fourth of respondents were able to match all of the pictures to the correct prices.

ImpactResults indicate that consumers across a wide range of demographics do not understand the relationship between fat content, USDA beef quality grades, eating satisfaction and price. This discordance can lead to retail consumers believing that they are purchasing a more satisfying steak than they actually obtain. When expectations are not met, consumers are likely to reduce future beef purchases.

Publications/PresentationsDeVuyst, E.A., J.L. Lusk, and M.A. DeVuyst, 2014. “USDA Quality Grades May Mislead Consumers,” Journal of Animal Science, 92:3142-3148.Presentation: American Meat Science Association’s Reciprocal Meats Conference. Madison, WI, June 2014.

Sources of FundingPartial funding is provided by the Oklahoma Agricultural Experiment Station and the Willard Sparks Endowed Chair.

CONTACT

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Researchers

Notie Lansford, Agricultural Economics professor, Extension economist and program leader of the County Training Program, and Sherri Schieffer, CTP local government specialist, coordinated the collection, organization and publication of data for two county revenue publications: the Abstract of County Government General, Highway and Special Revenue Funds in Oklahoma, and the Oklahoma Ad Valorem Mill Levies. The data for these documents are provided by county governments in annual reports to the Oklahoma state auditor and inspector.

Abstract of County Government General, Highway and Special Revenue Funds in

Oklahoma, Fiscal Year 2012-2013Sources of revenue for counties in Oklahoma include all revenues deposited into the County General Fund, the County Highway Fund and Special Revenue funds. These revenue sources can include ad valorem taxes, sales taxes, fuel taxes, motor vehicle fees, all other highway taxes and fees, and other fees and collections.The primary revenue source for the County General Fund is usually the county’s ad valorem tax collected on real, personal and public service property.

IssuesWhile all counties in Oklahoma have various sources of revenue, different counties can have different reliance on sources and different expenditures. Having a centralized database and a publication of budget information can prove useful to counties in planning and developing budgets.

ObjectiveThe Abstract of the General Fund for Counties in Oklahoma, 2000 Edition, was published in 2000 and contained county financial information for the 1998 to 1999 fiscal year. Since that time, a significant effort has been made to remake the publication to provide a more complete picture of county government finances. The result is the Abstract of County Government General, Highway and Special Revenue Funds in Oklahoma, which has been updated and published each fiscal year since 2002 to 2003.

ProjectInformation for the database is provided from the counties through their “County Estimate of Needs and Financial Statement of the Fiscal Year,” which they file with the state auditor and inspector’s office.This information is compiled and a database is developed from which the abstract is created.

ResultsSix tables are included in the abstract:Table 1 includes total revenue by county to the General Fund, the Highway Fund(s) and the Combined Special Revenue (Cash) Funds. Table 2 shows total expenditures by county from the General, Highway and Combined Special Revenue Funds for the fiscal year. Table 3 indicates fund balances for the same funds by county at the end of the fiscal year that are carried forward into the next fiscal year.Table 4 includes selected revenue streams that feature the primary sources of revenue to the General Fund, the Highway Fund(s) and some Special Revenue Funds. All ad valorem revenue goes into the General Fund. The county’s sales tax revenue may be appropriated to the General Fund or Special Revenue Funds or both. Fuel taxes comprise the majority of revenue to the county Highway Fund. Motor vehicle fees (taxes) are a source of revenue for both the General and the Highway Funds; the vast majority being allocated (by State Statute) to the Highway Fund.Table 5 shows the assessed valuations of each county. These form the basis for the ad valorem tax collected in fiscal year 2012-2013, designated FY 2013. By statute, taxable property is classified as either real property (land and buildings), personal property (such as furniture, fixtures, inventory and household goods), and public service property (centrally assessed utility and transportation company properties). Table 6 is a county by county summary of revenues and expenditures by fund, including additional details for the County General Fund.

ImpactThe information in the abstract helps county officials with planning, allocating funds and budgeting

County Revenue Publications

6 • Community Development

Yearly compilations provide county financial information

2014 Research Update • 7

decisions. The information is also useful to those doing research on county government.Data from the abstract is also used for individual county trends reports that show major revenue streams, historical spending patterns and other vital financial information over a span of 12 to 14 years.

Oklahoma Ad Valorem Mill Levies, Fiscal Year 2013

Mill levies are the tax rates levied to meet the county’s budgetary requirements for the county’s taxing jurisdictions including the county, school districts, technology centers, EMS, county health departments and other entities. The Oklahoma constitution and law sets the maximum tax levies.

IssuesAs with the abstract, all counties have mill levies, but rates and allocations can vary due to the variety of taxing entities. A centralized database is helpful to local government for comparisons and planning.

ObjectiveThe mill levey report is primarily assembled to assist local officials and others interested in managing public revenues. It may also be used to assess tax inputs.

ProjectInformation for the mill levies document comes from mill levy reports prepared by the counties and filed with the state auditor and inspector after local budgets and tax rates are set.

ResultsThis report provides a table of ad valorem tax levies for each county and shows the allocations within each taxing jurisdiction. Mill levies can cover schools, technology centers, emergency management, health departments and county libraries.Within each table, the rows are arranged by school district and the columns are by tax unit. For example, the county general fund is a tax unit. Each row is summed to give the total ad valorem tax

Notie LansfordProfessor, Extension Economist Oklahoma State University Dept. of Agricultural Economics311 Ag Hall, Stillwater, OK 74078Phone: 405-744-6160Email: notie.lansford@okstate.edu

millage that is levied on the taxable property within the school district.

ImpactMill levy information can be very useful for local governments. The data can help the county establish guidelines for revenues and draw comparisons with other local governments. They can help debt-rating agencies determine local government bond ratings. Local governments can also use the information for economic development to help attract new industries.The database also provides useful information for taxpayers and those studying public fiscal policy.

Publications/PresentationsAbstract of County Government General, Highway, and Special Revenue Funds in Oklahoma; Fiscal Year 2012-2013. http://agecon.okstate.edu/faculty/publications/4840.pdf.Oklahoma Ad Valorem Mill Levies, Fiscal Year 2013. http://www.rd.okstate.edu/resource/fiscal_year_2013.htm

Sources of FundingPrimary funding for both of these documents is provided by the Oklahoma Cooperative Extension Service. Secondary funding is provided by the Commission on County Government Personnel Education and Training, the Association of County Commissioners of Oklahoma, and the Oklahoma Tax Commission.

CONTACT

Sherry Schieffer (left), County Training Program local government specialist, and Elizabeth Addcox, temporary technical support person, examine a county report’s data for the mill levy report. Photo by Judy Rudin.

Over the past few years, the health care industry has been abuzz with talk regarding the use of Electronic Medical Records. In general, an EMR is a medical record in digital format that provides all relevant information about a patient in one single location. These records can then be shared across health care providers. For example, a hospital would have access to the latest information from a patient’s primary care doctor (and vice versa). A more formal definition, according to the American Hospital Association is “a system that integrates electronically-originated and maintained patient-level clinical information, derived from multiple sources, into one point of access.”EMRs became popular in the 1990s as a method to attempt to transform the health care industry. They are computer-based records that reduce the use of paper records, provide legible and organized information, and have the potential to reduce health care costs and improve health outcomes.

ResearchersResearchers for this project include Randi Williams, Agricultural Economics graduate student, Brian Whitacre, Agricultural Economics associate professor and Extension economist, and Lara Brooks, Oklahoma Cooperative Extension Service, Extension associate.

IssuesThe dramatic rise of EMRs has been well documented. Physician-level EMR adoption rates increased from 18 percent to 54 percent between 2001 and 2011. However, divides have emerged among various segments of the health care industry. Several early studies, prior to 2007, found EMR adoption lagged behind in rural areas, however, this was for both hospitals and physicians.More recently however, studies have either documented no significant differences between rural and urban areas or have found that rates of adoption were slightly higher in rural areas. While these studies break out overall differences in EMR adoption rates for categories such as primary care (versus specialists) or large offices (versus small), none explicitly model whether specific factors impact the adoption decision differently in rural areas.

The most recent research has not found significant differences in EMR adoption rates between rural and urban physicians. However, few studies have assessed rural/urban differences at a lower level—for instance, by specialty or size of practice. Also, no research has explicitly examined whether the availability of broadband is a determining factor in the EMR adoption decision. In particular, it is not clear whether a relationship exists between EMR adoption rates and measures of broadband availability—such as number of broadband providers or maximum download speeds.The findings have implications for federal pilot programs aimed at increasing broadband availability for specific health care entities.

ObjectiveThe objective of this research is to determine the factors affecting EMR adoption by physician practices in Oklahoma (rural versus urban), including the potential role of broadband availability (which is required for EMR interoperability).

ProjectSurveys of 2,800 unique Oklahoma physician practices in 2011 are meshed with data from the National Broadband Map for that same year. Summary statistics from the survey data allow for comparison of EMR

Electronic Medical Record Adoption Rates

8 • Health Care

Do rural-urban differences exist in Oklahoma?

Dr. Robert Williams, DO, primary care physician, consults a record in a room full of paper medical records, as they were available before changing to an EMR computer record system. Photo courtesy of Randi Williams.

adoption rates by sub-category. Logistic regressions are used to tease out the impact of location, specialty and broadband availability on EMR adoption.

ResultsSimilar overall EMR adoption rates in rural and urban practices mask significant differences among specific sub-categories. In particular, solo practices in rural areas are much more likely to adopt EMRs than are their urban counterparts (41% vs. 33%, p<.01), and rural psychiatric practices also have measurably higher adoption rates (59% vs. 25%, p<.01). Results demonstrate that the determinants of adoption do vary between rural and urban practices. No statistical relationship between EMR adoption and measures of broadband availability is found.

ImpactDeterminants of EMR adoption do vary across rural/urban locations for physician practices in Oklahoma, but broadband availability is not a significant factor in this state.

Measurable differences in EMR adoption rates do exist between rural and urban practices for specific physician categories in Oklahoma. These results show that targeted policies may be important for increasing EMR adoption, but policy efforts focusing solely on broadband availability for private practices are likely misguided.From a policy standpoint, the results suggest that future efforts in increasing EMR adoption should be focused on targeting specific categories of physicians using specialized conferences, webinars or other types of outreach (such efforts in Oklahoma might choose to focus more effort on psychiatric practices in urban areas).Encouraging buy-in from professional societies—such as ophthalmologists or orthopedic surgeons—will also be an important factor for promoting EMR adoption by a specific group.Further research is also needed. While this study clarified the limited role that broadband availability currently plays in EMR adoption, documenting the specific factors

Brian WhitacreRegents Professor and Willard R. Sparks Endowed Chair Oklahoma State University Dept. of Agricultural Economics504 Ag Hall, Stillwater, OK 74078Phone: 405-744-9825Email: brian.whitacre@okstate.edu

Lara BrooksExtension Associate, OCESOklahoma State University Dept. of Agricultural Economics513 Ag Hall, Stillwater, OK 74078Phone: 405-744-9827Email: lara.brooks@okstate.edu

that do have more impact on the adoption decision would be useful.

Publications/PresentationsWhitacre, B. E., Brooks, L., and Bray, J. “Electronic Medical Records: What are They?” Oklahoma Cooperative Extension Service Current Report CR-1013. Retrieved from http://www.osuextra.com.Whitacre, B.E, Williams, R., and Brooks, L. “EMR Adoption across Oklahoma.” Oklahoma Cooperative Extension Service Fact Sheet AGEC-1047. Retrieved from http://www.osuextra.com Whitacre, B.E. and Williams, R.S. Forthcoming. “Electronic Medical Record Adoption in Oklahoma Practices: Rural-Urban Differences and the Role of Broadband Availability.” The Journal of Rural Health. Retrieved from http://onlinelibrary.wiley.com/doi/10.1111/jrh.12086/abstract

CONTACT

After transferring paper medical records to an EMR computer system. Williams now has access to multiple records, all centrally located. Photo courtesy of Randi Williams.

Because of continuing budget challenges in recent decades, many non-metropolitan communities and counties have, or are, considering increasing sales taxes as a way to fund government operations. Sales tax has recently replaced the property tax as the largest single source of Oklahoma county government revenue.Sale tax revenues are often used for public services and infrastructure such as law enforcement, medical services, emergency management, road maintenance and other capital improvements. Also, tax money could be used to promote rural development.

ResearchersFaculty working on this study are Notie Lansford, Agricultural Economics professor and Extension economist, and Wade Brorsen, Agricultural Economics Regents professor and holder of the A.J. and Susan Jacques Chair.

IssuesAs sales tax rates rise, the effective price of taxable goods rises. Classical economic theory indicates that rising prices will result in less quantity demanded and/

or substitution effects. The greater the price increase, the greater the effects. For example, when faced with higher tax rates, consumers could choose to spend money on non-taxable goods or shop online.

ObjectiveThe objective of this project is to determine the consequences of increasing local sales tax rates in non-metropolitan counties. Several studies have found decreased local retail trade in communities where local sales tax rates exceed surrounding communities. This project seeks to address the question, how much increased revenue can a community expect from increasing local sales tax rates? Because the increased tax rates are expected to reduce retail sales, a 1 percent increase in the sales tax rate will generate less than a one percent increase in revenue.

ProjectsThis analysis focuses on the relationship between retail sales and local sales tax rates. This research used 27 years of local government (city and county) taxable retail sales for all Oklahoma non-metropolitan counties.

10 • Rural Economy

Photo above: Communities and counties in Oklahoma rely on sales tax revenues from retail sales to help maintain public services and infrastructure. Photo of historic, downtown Guthrie, Oklahoma. Photo credit to Erik Bauer, www.city-data.com.

Consequences of

local sales tax ratesINCREASING

2014 Research Update • 11

A model that provides direct estimates of the effect of sales tax rates on retail sales was used for communities in a state with local option sales taxes. Going beyond past literature, the researchers used a new econometric model that allowed them to better determine the point at which local government sales tax rates begin to cause a decline in retail sales.

ResultsThe key finding from this project is that the effect of the local sales tax rate on retail sales is near zero until combined city and county sales tax rates reach about 4 percent. At sales tax rates above 4 percent, retail sales decrease sharply. In 2010, combined city and county rates averaged 4.3 percent (see figure below). Thus, the majority of communities are already at the point where increasing tax rates could cause a substantial drop in sales. A penny increase in sales tax rates from 4 cents to 5 cents is expected to increase revenues by only 74 to 80 cents instead of 1 cent.

ImpactThis project provides important information for communities and counties when planning sales tax rates. They can use this information to choose whether or not to increase rates and to forecast revenues for budgets when rates change.This project indicates that as long as communities keep the combined county and municipal rate below 4 percent, little loss in sales from increased sales tax rates should occur. At rates above 4 percent, however, a substantial loss in sales is expected. Note the total

Notie LansfordProfessor, Extension Economist Oklahoma State University Dept. of Agricultural Economics311 Ag Hall, Stillwater, OK 74078Phone: 405-744-6160Email: notie.lansford@okstate.edu

Wade BrorsenRegents Professor and A.J. and Susan Jacques Chair Oklahoma State University Dept. of Agricultural Economics414 Ag Hall, Stillwater, OK 74078Phone: 405-744-6836Email: wade.brorsen@okstate.edu

revenue still goes up, but only by about three-fourths of the amount if there were no loss in sales.

Publications/PresentationsBrorsen, B., Lansford, N. 2013“Sales Tax Collections in Nonmetropolitan Communities.” Public Finance Review, 41, No. 4, 489-502.Brorsen, B. , Lansford, N. 2013 “Sales Tax Collections in Nonmetropolitan Communities.” Selected poster, Agricultural and Applied Economics Association, Washington, DC.

FundingThe research was funded by the Oklahoma Agricultural Experiment Station and Oklahoma Cooperative Extension Service.

CONTACT

Combined city and county sales tax rates averaged 4.3 percent in 2010, with many communities with sales tax above 4 percent.

Helping small- and medium-sized producers and agriculture businesses to take their

enterprises to the next level

Dave Shideler, Agricultural Economics associate professor and Extension economist, is one of the lead researchers on a U.S. Department of Agriculture grant. Also working on this project is Merritt Taylor, Agricultural Economics professor.Researchers will be looking at ways to help small- and medium-sized producers and agriculture businesses take their enterprises to the next level.Though national in scope, the project easily has the potential to affect any producer in Oklahoma, according to Shideler. “The idea is to help producers move forward, regardless of the current size of their operations,” Shideler said. “Our work will apply to the farmer operating a roadside fruit stand in Idabel, as well as to the producer in Arnett who wants to begin selling watermelons to the local school.”The 3-year, $484,000 award is a significant slice of $7 million awarded to 10 universities through the USDA’s National Institute of Food and Agriculture, Agriculture and Food Research Initiative, Small- and Medium-Sized Farms program.The research team will work directly with farmers, ranchers, co-op managers, aggregators and others involved with local and regional food systems across the nation to develop typical economic structures of various businesses.

The economic structures will be incorporated into an updated schematic, which was originally developed in the late 1990s.In addition to producers, project researchers also will target local government officials in an effort to help them develop ways to support the growth of local food producers based in their communities. Another anticipated outcome of the project is a streamlined evaluation method to better gauge the economic impact of local and regional food systems.As part of the project’s Extension component, the research team will produce materials such as fact sheets and share information through a national conference.

Impacts of oil and gas development on agricultural lands

Working in conjunction with the National Agricultural Law Center, Shannon Ferrell, Agricultural Economics associate professor, recently secured two Southern Risk Management Education Center grants to create materials and programs that will help farmers and ranchers understand two increasingly important issues: the impacts of oil and gas development on agricultural lands and how they can comply with the ever-growing number of state and federal environmental regulations. The two grants will help fund the development of plain-English guides and decision-aid tools, along with regional workshops for farmers and ranchers.

Future Research

12 • Future Research

Photo courtesy of Oklahoma State University.

Photo courtesy of Oklahoma State University.

2014 Research Update • 13

Strategies for safeguarding water supplies in Oklahoma and the Midwest

Tracy Boyer, Larry Sanders and Art Stoecker of Agricultural Economics are part of a team of Oklahoma State University researchers studying the best strategies for safeguarding water supplies in Oklahoma and the Midwest after earning a U.S. Department of Agriculture, National Institute of Food and Agriculture grant totaling more than half a million dollars.Garey Fox, Biosystems and Agricultural Engineering professor and holder of the Buchanan Endowed Chair, is leading a team of university and USDA-Agricultural Research Service researchers studying the best ways to protect water supplies in Oklahoma and the Midwest. The 3-year grant of $638,000 was awarded this fall through the USDA’s National Integrated Water Quality Program and will include researchers from the OSU Department of Biosystems and Agricultural Engineering, OSU Department of Agricultural Economics and the USDA-ARS Grazing Lands Research Station in El Reno, Oklahoma.“This research focuses on the long-term protection of water supplies,” Fox said. “Those supplies could be used for drinking water, recreation and irrigation. We’re trying to develop the best strategies to prevent excess sediment from getting into reservoirs and causing them to decline or fill up, shortening their life spans or projected capacity.”While studies now show as much as 80 percent of the sediment load entering streams in some watersheds is coming from stream banks, attempts to control sediment loads have often focused almost exclusively on implementing upland practices.OSU and USDA-ARS researchers plan to expand that approach to look at the most effective combination of upland, in-stream and riparian erosion strategies to reduce sediment loads reaching Fort Cobb Reservoir in

Southwest Oklahoma.As part of the project, the research team will aerially survey the watershed’s stream banks, work with landowners to evaluate the strength of stream banks within the watershed and model the impact of in-stream sediment load reduction strategies.“We hope to provide a framework and tools for other watersheds in Oklahoma and in the Midwest to use to prevent sediment from getting into our streams and reservoirs,” Fox said.The grant will require the team to focus on pushing the science while also paying attention to the real world application of the science.Agricultural economics faculty on the project will examine the costs associated with different strategies as well as survey landowners, watershed managers, government officials and other stakeholders on the potential determinants to adopting the practices.

Dave ShidelerAssociate Professor & Extension EconomistOklahoma State University Dept. of Agricultural Economics323 Ag Hall, Stillwater, OK 74078Phone: 405-744-6170Email: dave.shideler@okstate.edu

Shannon FerrellAssociate ProfessorOklahoma State University Dept. of Agricultural Economics532 Ag Hall, Stillwater, OK 74078Phone: 405-744-9815Email: shannon.l.ferrell@okstate.edu

Tracy BoyerAssociate ProfessorOklahoma State University Dept. of Agricultural Economics321 Ag Hall, Stillwater, OK 74078Phone: 405-744-6169Email: tracy.boyer@okstate.edu

Photo courtesy of Oklahoma State University.

Contact

Department of Agricultural Economics

12 STEPS TO KEEP THE FAMILY FARMING Authors: Brian Schurle, Rodney Jones, D. Hund Source: Angus Beef Bulletin

ALTERNATIVE RETENTION AND MARKETING STRATEGIES FOR CULL COWSAuthors: Zakou Amadou, Kellie Raper, J. T. Biermacher, Devlon Ford, Billy Cook, Clem Ward Source: Journal of the American Society of Farm Managers and Rural Appraisers, Volume 76(1):248-267 Subject: Marketing Keywords: livestock marketing, salvage value, cull cows

ARE LIQUIDITY COSTS HIGHER IN FUTURES OPTIONS MARKETS OR IN OPTIONS MARKETS? Authors: Samarth Shah, Wade Brorsen Source: Applied Financial Economics Date: 23:701-708 Subject: Marketing Keywords: bid-ask spread, liquidity cost

CAN THE FEDERAL RESERVE BANK’S SURVEY OF AGRICULTURAL CREDIT CONDITIONS FORECAST LAND VALUES?Authors: Christopher Zakrzewicz, Wade Brorsen, Brian Briggeman Source: Journal of Agricultural and Applied Economics, 45:159-170 Subject: Agribusiness, Production Economics Keywords: land, price, survey

CHANGES IN MARKET POWER FROM THE LIVESTOCK MANDATORY PRICE REPORTING ACT: AN AGENT-BASED AUCTION MODEL APPROACH Authors: Chris N. Boyer, Wade Brorsen Source: American Journal of Agricultural Economics, 95:859-876 Subject: Marketing Keywords: agent-based models, auctions, livestock, mandatory price reporting

COMMON-VALUE AUCTION VERSUS INTRADAY PATTERNS IN CHINESE FUTURES MARKETS Authors: Yu Wu, Wade Brorsen, Pin Ren Source: Review of Futures Markets, 21:173-193 Subject: Marketing Keywords: bid-ask spread, liquidity cost

CONSTRUCTION AND OPERATING COSTS FOR WHITETAIL DEER FARMS Authors: Eric DeVuyst Source: JASFMRA Subject: Production Economics Keywords: farmed whitetail deer, budget, construction

2013 Journal Articles

14 • Journal Articles

To access other publications and presentations by Agricultural Economics authors, go to: http://agecon.okstate.edu/faculty/publications.

CONSUMER VALUATION OF ALTERNATIVE MEAT ORIGIN LABELS Authors: Glynn Tonsor, Ted Schroeder, Jayson Lusk Source: Journal of Agricultural Economics, 64(2013):676-692 Subject: Marketing, Policy

DATA AGGREGATION IN STOCHASTIC FRONTIER MODELS: THE CLOSED SKEW NORMAL DISTRIBUTION Authors: Wade Brorsen, T. Kim Source: Journal of Productivity Analysis, 39:27-34 Subject: Production Economics, Quantitative Methods Keywords: aggregation, skew normal, frontier function

DECOMMISSIONING WIND ENERGY PROJECTS: AN ECONOMIC AND POLITICAL ANALYSIS Authors: Shannon Ferrell, Eric DeVuyst Source: Energy Policy, 53:105-113 Subject: Policy Keywords: Wind energy, decommissioning DEMOGRAPHIC FACTORS AFFECTING THE ADOPTION OF VALUE-ADDED PRACTICES BY OKLAHOMA COW-CALF PRODUCERS Authors: Brian Williams, Kellie Raper, Eric DeVuyst, Damona Doye, Derrell Peel, Dave Lalman, Chris Richards Source: Journal of Extension, Volume 51-6, Article 6FEA7 Subject: Marketing, Production Economics Keywords: beef producers, cattle management, management practice adoption, value-added practices

DO CONSUMERS REALLY KNOW HOW MUCH THEY ARE WILLING TO PAY? Authors: Kristen Kovalsky, Jayson Lusk Source: Journal of Consumer Affairs, 47(2013):98-127 Subject: agribusiness, marketing, policy

EFFECTS OF COST AND CAMPAIGN ADVERTISING ON SUPPORT FOR CALIFORNIA’S PROPOSITION 37 Authors: Brandon McFadden, Jayson Lusk Source: Journal of Agricultural and Resource Economics, 38(2013):174-186 Subject: Agribusiness, Policy Keywords: gmo labeling, biotechnology EVALUATING TOP FACULTY RESEARCHERS AND THE INCENTIVES THAT MOTIVATE THEM Authors: Cory Miller, Keith Coble, Jayson Lusk Source: Scientometrics, 97(2013)519-533 FACTORS IMPACTING PARTICIPATION IN AND PURCHASES MADE BY MEMBERS OF THE OKLAHOMA FOOD COOPERATIVE Authors: Rodney Holcomb, Philip Kenkel, Lisa Brown Source: Journal of Cooperatives, Vol. 27 Subject: Agribusiness Keywords: local food, cooperatives, member participation, cooperative governance

2014 Research Update • 15

FINANCING HERD REBUILDING FOLLOWING THE 2011 DROUGHT Authors: Damona Doye, Derrell Peel, Roger Sahs, Eric DeVuyst Source: JASFMRA Keywords: Drought, cow-calf, finance

FOOD SAFETY POLICIES AND IMPLICATIONS FOR LOCAL FOOD SYSTEMS Authors: Rodney Holcomb, Marco Palma, Margarita Velandia Source: Choices, Vol. 28, No. 4 Subject: Agribusiness Keywords: local food, food safety, FSMA, GFSI, policy

IMPLICATIONS OF A RESERVE PRICE IN AN AGENT-BASED COMMON VALUE AUCTION Authors: Chris N. Boyer, Wade Brorsen Source: Computational Economics, 43:33-51 Subject: Marketing, Quantitative Methods Keywords: agent-based model, auction

INCOME AND EMPLOYMENT EFFECTS OF SHALE GAS EXTRACTION WINDFALLS: EVIDENCE FROM THE MARCELLUS REGION Authors: Larry Sanders Source: Energy Economics Subject: Policy Keywords: shale gas income and employment

INFLUENCE OF PERSONALITY ON BEHAVIOR IN EXPERIMENTAL AUCTIONS AND CHOICE EXPERIMENTS Authors: Carola Grebitus, Rudy Nayga, Jayson Lusk Source: Journal of Economic Psychology, 36(2013):11-26 Subject: Agribusiness, Marketing

IS DATA NEEDED FROM EVERY FIELD TO DETERMINE IN-SEASON PRECISION NITROGEN RECOMMENDATIONS IN WINTER WHEAT? Authors: David Roberts, Wade Brorsen, J. B. Solie, W.R. Raun Source: Precision Agriculture, 14:245-269 Subject: Production Economics

LOCAL FOOD SYSTEMS MARKETS AND SUPPLY CHAINS Authors: Timothy Woods, Margarita Velandia, Rodney Holcomb, Rebecca Dunning, Eric Bendfeldt Source: Choices, 28,4 Subject: Agribusiness Keywords: local food, food hub, supplier, marketing, small farms

LOCAL FOODS - IS A MILE A MILE? EFFECT OF DISTANCE OF TRANSPORTATION ON WILLINGNESS TO PAY FOR FOOD Authors: Carola Grebitus, Jayson Lusk, Rudy Nayga Source: Ecological Economics, 88(2013):67-75 Subject: Agribusiness, Marketing, Policy

16 • Journal Articles

LOOKING AT THE LABEL AND BEYOND: THE EFFECTS OF CALORIE LABELS, HEALTH CONSCIOUSNESS, AND DEMOGRAPHICS ON CALORIC INTAKE IN RESTAURANTS Authors: Brenna Ellison, Jayson Lusk, David Davis Source: International Journal of Behavioral Nutrition and Physical Activity, 10(2013), Article 21 Subject: Agribusiness, Policy

LUNCH WITH PIGOU: EXTERNALITIES AND THE “HIDDEN” COSTS OF FOOD Authors: Jayson Lusk Source: Agricultural and Resource Economics Review, Vol. 42, p. 419-435 Subject: Policy

NONLINEAR RESERVOIR OPTIMIZATION MODEL WITH STOCHASTIC INFLOWS: A CASE STUDY OF LAKE TENKILLER. Authors: Deepayan Debnath, Tracy Boyer, Art Stoecker, Larry Sanders Source: Journal of Water Resources Planning and Management Keywords: water value, stochastic optimization, Lake Tenkiller, recreational, hydropower

OUTREACH MATTERS Authors: Damona Doye Source: Journal of Agricultural and Applied Economics, 45:351-357 Keywords: SAEA, extension

QUANTIFYING STUDENT PREFERENCES FOR SPENDING FEES FOR TECHNOLOGY IN A COLLEGE OF AGRICULTURAL SCIENCES AND NATURAL RESOURCES Authors: Chris Baker, Tracy Boyer, Chanjin Chung Source: NACTA Journal, 57(2)

ROLE OF TECHNOLOGY IN THE GLOBAL ECONOMIC IMPORTANCE AND VIABILITY OF ANIMAL PROTEIN PRODUCTION Authors: Jayson Lusk Source: Animal Frontiers, 3(2013):20-26 Subject: Other, Policy, Production Economics Keywords: livestock, meat, value of research, technology

SALES TAX COLLECTIONS IN NONMETROPOLITAN COMMUNITIES Authors: Wade Brorsen, Notie Lansford Source: Public Finance Review Subject: Ag Law and Taxation, Community & Rural Development Keywords: rural development, sales tax, semiparametric estimation SIMPLE LAWN IRRIGATION MEASUREMENT TRAINING FOR MASTER GARDENERS AND HOMEOWNERS Authors: Justin Moss, John Haase, Tracy Boyer Source: Journal of Extension , 51(3) Subject: Horticulture Keywords: drought, water management, turf, extension

2014 Research Update • 17

STUDENTS’ PERCEPTIONS OF COMMUNICATIONS AND COURSE MOTIVATION PROVIDED BY FACULTY Authors: Amanda Evert, Cindy Blackwell, Dan Tilley, Paul Weckler, Rodney Holcomb Source: Journal of Natural Resources and Life Sciences Education, 42,1 Keywords: interdisciplinary education, capstone course, teaching

THE FUTURE OF AGRICULTURAL LAW: A GENERATIONAL SHIFT Authors: Shannon Ferrell, Derrell Peel, Derrick Davies, Rodney Jones Source: Drake Journal of Agricultural Law, Vol. 18

THE PATERNALIST MEETS HIS MATCH Authors: Jayson Lusk Source: Applied Economic Perspectives and Policy Subject: Policy

THE POLICY AND LEGAL ENVIRONMENT FOR FARM TRANSITIONS Authors: Shannon Ferrell, Michael Boehlje, Rodney Jones Source: AAEA Choices, 2Q 2013 Subject: Ag Law and Taxation, Agribusiness, Policy THE VALUE OF GENETIC INFORMATION TO LIVESTOCK BUYERS: A COMBINED REVEALED, STATED PREFERENCE APPROACH Authors: Mallory Vestal, Jayson Lusk, Eric DeVuyst, J.R. Kropp Source: Agricultural Economics, 44:337-347 Subject: Production Economics Keywords: genetic information, beef, bull sales

THEME OVERVIEW: TRANSITIONS IN AGRICULTURE Authors: Shannon Ferrell Source: AAEA Choices, 2Q 2013 Subject: Ag Law and Taxation, Agribusiness, Policy Keywords: agriculture, agricultural finance, agricultural policy, farm firm and farm households, land ownership and tenure, retirement

WEIGHT LOSSES AND GERMINATION FAILURE CAUSED BY PSOCIDS IN DIFFERENT WHEAT VARIETIES. Authors: Sandipa Gautam, George Opit, Kris Giles, Brian Adam Source: Journal of Economic Entomology , 106(1):491-498 Subject: Marketing Keywords: insect control, stored wheat WHEN DO FAT TAXES INCREASE CONSUMER WELFARE? REPLY TO NEILL. Authors: Jayson Lusk, Christiane Schroeter Source: Health Economics, 22(2013):1284-1286 Subject: Policy

18 • Journal Articles

WHO IS TO BLAME FOR THE RISE IN OBESITY? Authors: Brenna Ellison, Jayson Lusk Source: Appetite, 68(2013):14-20 Subject: Agribusiness, Policy

WHOLE-CHAIN TRACEABILITY, IS IT POSSIBLE TO TRACE YOUR HAMBURGER TO A PARTICULAR STEER, A U. S. PERSPECTIVE? Authors: Phil Crandall, Dinesh Babu, Nathan Jarvis, Mike Davis, Brian Adam, John Marcy, Steven Ricke Source: Meat Science Keywords: whole-chain traceability, livestock supply chain

Department of Agricultural Economics Oklahoma State University

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