Capturing Experts' Uncertainty in Welfare Analysis: An Application to Organophosphate Use Regulation in U.S. Apple Production

17 Pages Posted: 24 Mar 2020

See all articles by Jutta Roosen

Jutta Roosen

Technische Universität München (TUM) - TUM School of Management

David Hennessy

Iowa State University

Date Written: February 2001

Abstract

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.

Keywords: Bayesian updating expert opinion, impact uncertainty, pesticide regulation, stochastic ordering, Suprabayesian, welfare analysis, L510, L660, Q110, Q180

Suggested Citation

Roosen, Jutta and Hennessy, David, Capturing Experts' Uncertainty in Welfare Analysis: An Application to Organophosphate Use Regulation in U.S. Apple Production (February 2001). American Journal of Agricultural Economics, Vol. 83, Issue 1, pp. 166-182, 2001, Available at SSRN: https://ssrn.com/abstract=3558153 or http://dx.doi.org/10.1111/0002-9092.00145

Jutta Roosen (Contact Author)

Technische Universität München (TUM) - TUM School of Management ( email )

Freising
Germany

David Hennessy

Iowa State University

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