In this paper the literature on industry clusters as a response to local collective failure is reviewed as a way of enhancing knowledge about how failure of food value chains to perform efficiently can be analysed and overcome. The conclusion is that there is much in the local collective failure literature that assists in an understanding of, and is consistent with, the concepts of value chain failure, value chain externalities and value chain goods. Four potential areas for enhancing the analysis of value chains by accessing this literature are noted: defining the boundary between chain failure and local collective failure; improving joint action among parties interested in overcoming chain failure; augmenting the processes of knowledge creation and application in value chains; and improving the governance of value chains. The key point is that the ability of local collective or value chain partners to produce chain goods and internalise positive chain externalities depends directly on the nature and intent of the joint action by the partners: will they cooperate or not, and, if they do cooperate, how and to what extent will they do so? These issues of coordination of economic activity and the nature of the relationships between partners go to the heart of governance within both local communities and value chains.

Cassava is an important tropical root crop for food security and national economies. In Ghana, the roots are used in popular local cuisines as well as in brewery, bakery, confectionery and plywood industries. A number of high-yielding and disease-resistant varieties are released and promoted to increase productivity and improve rural welfare. The study used a sequential mixed-method approach to identify, among drivers and impediments, the dissemination mechanism with highest impact on the adoption of improved cassava varieties (ICVs) and its intensity. The analyses helped estimate the impact of ICV adoption on productivity and households' livelihood, and to provide evidence of technological, managerial, and environmental gaps between adopters and non-adopters. Data were collected in 2014 from 608 randomly selected cassava-producing households in 14 communities in six districts of the Ashanti and Brong-Ahafo regions. Summary statistics reveal a 25 percent ICV adoption rate. Econometric analyses indicate significant and positive effects on the likelihood of households' ICV adoption for group members, the number of varieties planted, the number of livestock owned and information received mostly through innovation platforms (IPs). Impediments to ICV adoption include the location in the Ashanti region, household size, distances to the nearest tarred road and market, and grey-skin colour of ICVs. Results from propensity score matching and instrumental variable approaches indicate positive impacts of ICV adoption on cassava and whole-farm productivities and on per-capita annual crop income. Adopters appear to incur lower total annual per-capita expenditures and expenditures on food than non-adopters but spend more on children’s education. Bias-corrected stochastic output distance functions and stochastic metafrontier production functions showed strong evidence of technological, managerial, and environmental gaps between adopters and non-adopters in both cassava and whole-farm production. In both cases, adopters were found to operate on higher frontiers and to be more efficient than non-adopters. Adopters also appear to operate in a more favourable 2 production environment than non-adopters. The study provides strong evidence of inefficiency in cassava production for both ICV adopters and non-adopters. Findings imply that policy measures could be taken to increase the 25 percent ICV adoption rate through the establishment of IPs, focusing on households in Brong-Ahafo and those who are group members that integrate livestock-farming with cassava production. ICV adoption is expected to lead to increased productivity through technological change and enhanced efficiency. Moreover, the adoption of ICVs has the potential to increase crop incomes, food security and result in higher investment in children’s education, especially for female-headed households.

We test for the presence of synergies and associated economic gains on farms in Norway from exploiting a diverse set of income-earning possibilities. The synergies and economic gains from product diversification are examined between livestock output, crop output, off-farm income, coupled subsidies and environmental payments. Synergies are measured by the second cross partial derivatives of outputs, and economic gains from diversification are measured by scope economies, with the former a necessary but insufficient condition for the latter. While synergies are evident, they do not result in economic gains from diversification of on-farm and off-farm activities. Evidence is also presented of significant diseconomies of small scale in farming operations. In contrast to results obtained for farms in the US Corn Belt, however, they are not assuaged when off-farm work is taken into account.

Productivity change and real returns to resources are measured for a sample of farms in south-west Victoria that produce beef. A stochastic frontier production model is estimated from which annual production frontiers and individual farm technical inefficiencies are calculated during the survey period from 1995-96 to 2004-05. Results suggest that best-practice beef producers in this region (those operating on the production frontier) modestly improved their productivity during the period. Technically inefficient farms seem to be achieving productivity increases lower than their top-performing counterparts and are on average falling behind the productivity levels of the latter. A single factoral terms of trade index is also estimated for each farm as a measure of the real returns to resources used in the beef enterprise. The mean annual index increased substantially after declining during the first year of the survey period. This measure showed much greater volatility than the productivity measure, principally because of fluctuations in beef prices.

The Australian wine industry is currently experiencing a correction, ostensibly a victim of its own success. Some observers have concluded that prospects for the industry in the medium- to long-term are strong. However, a consortium of peak industry organizations recently called for more radical approaches to industry restructuring to protect its core viability. Against these uncertain prospects, this paper adopts a multidisciplinary approach to analyse the prospects for one of Australia's newest wine regions, New England Australia. We argue that despite the barriers to its development, a commercially sound course can be charted for New England Australia. This course is based on a regional strategic alliance featuring leadership, improved inter-industry cooperation, niche marketing and a branding strategy focused on what is unique to the region.

The scoring of wines and the ratings of wineries is the source of much debate. In this paper we attempt to explain variations in winery ratings in Victoria by examining two winery rating systems, the winery 5-star ratings system of Halliday and the WineBoss version that modifies the Halliday system, to obtain a consensus industry rating from a variety of sources; in conjunction with a limited number of other data about the wineries that are rated. We use ordered logit models and odds ratios on a sample of rated Victorian wineries (291 in the Halliday sample and 331 in the WineBoss sample) to see which predictor variables increase the odds of a winery being in a higher-rated category. Wineries that are older, use a consultant winemaker and/or produce predominantly red wines are more likely to be in a higher-rated category than those wineries that do not; conversely, wineries that use a contract winemaker and/or are located in a number of particular regions of Victoria are more likely to be in a lower-rated category than those wineries that do not. All of these results are as expected and confirm previous research. However, neither the size of the winery in terms of output nor whether the winery has other revenue sources, such as a restaurant, has any significant correlation with winery rating. The paper concludes with some suggestions for further research.

This study highlights the usefulness, versatility and general dexterity of an extremely robust methodology for assessing structural change in agriculture. The methodology is the multiple change point model estimator developed by Chib (1998). Despite its appeal it has, until now, remained hitherto unexploited in agricultural economics. We modify slightly the seminal prototype in Chib (1998) to embrace a rich set of rotating panel observations on agricultural cereals enterprises as assessed previously by Hadley (2006). Evidence is presented that multiple structural change occurred throughout the consecutive sample periods 1983:1986, 1989:1997, and 2000:2002.

Today I have been allocated 20 minutes or so to discuss the "Economics of the red meat industry". No small task. I thought about reporting the results of different analyses I have done in relation to beef production systems, marketing margins, or large industry-level models. But, given that we have already had an excellent overview of domestic and overseas markets from MLA, and detailed analyses from the processor and producer perspectives, I thought that I might try something a little different and make some suggestions about how the whole industry might improve future performance. I start by asking "Whose economics is it?", and follow by suggesting that the answer is "It must be everyone's". This leads to the idea that the way to analyse the economics of the red meat industry is by assessing and evaluating the performance of the value chains that comprise this industry. This is based on the following two assertions: First, global food, beverage and fibre markets (of which the Australian red meat industry is a prime example) are now mostly networks of global value chains. Increasingly such global chains are private and powerful, closely coordinated or fully vertically integrated, self-regulated and experience-based (Griffith et al. 2012, 2015). The old ways of analysing the performance of these markets, such as described for example in Kohls and Uhl (1980), are no longer appropriate. Second and following, value chains have now become the preferred unit of enquiry for analysing and evaluating global and domestic food, beverage and fibre markets (Baker et al. 2014, Griffith et al. 2015).

We analyzed the productivity levels of smallholder farms in northern Thailand practicing different 'clean and safe' vegetable farming systems or conventional vegetable (CV) production. 'Clean and safe' farmers are categorized into three groups based on their use of synthetic chemicals: organic, pesticide-free and safe-use. Farm-level data on vegetable production were collected from random samples of farms operating these farming systems. A standard stochastic production frontier model and a metafrontier model were estimated for each system to obtain estimates of technical efficiency (TE) with respect to their cohorts, metatechnology ratios (MTRs, showing the extent of technology gaps between farming systems) and overall productivity measures. Productivity levels were found to vary moderately between farming systems. 'Clean and safe' farms achieved a higher mean TE score than conventional farms, indicating a more efficient use of inputs in producing a certain level of output within their system. However, their MTRs were significantly lower than those of conventional farmers, indicating greater production technology constraints because of the need to conform to strict guidelines. All four farming systems had at least one farmer who could overcome the technological constraints to achieve the highest possible output regardless of the technology used. Effective assistance providers were found to be crucial for farmers to achieve high productivity in the organic farming system. Improvements are needed to raise low productivity levels through technology transfer, value chain improvement and farmer capacity in production and marketing. The required improvement strategies differ among farming systems.

Useful insights about the operations of value chains can be gained by considering them as "latent clubs", that is, systems having the potential for improvement through collective action. Club theory therefore can be applied to examine ways to increase the economic surplus of a food value chain by participants taking collective action within a club good framework. The results of such action are called "chain goods". If these types of goods are not supplied along the value chain, value chain partners cannot maximise whole-of-chain profit. The result is "chain failure"; a concept analogous to the market failure of public goods in the wider economy. If an opportunity exists for partners in a value chain to collectively provide such goods, forming a club may be an efficient way do so. Horizontal and vertical strategic alliances are formed among firms, or groups of firms, in the value chain at the same level and/or across different levels. These alliances within a value chain are formed to correct some particular chain failure(s), such as supplying chain goods or internalising chain externalities. Strategic alliances may comprise all or only some chain members. Thus, they are clubs. The theoretical concepts of chain failure, chain goods and chain externalities can be used as a framework for evaluating whether to invest or not in a strategic alliance. The fact that there are existing alliances which appear to be organised in this way suggests that these concepts have practical as well as theoretical merit.