Kenkel, Norris
Real-Time Weather Information 361
Table ɪ. Variables Hypothesized to Explain Willingness to Pay for Mesoscale Weather Data
|
Variable |
Unit |
Hypothesized |
Definition |
|
NEWS |
$10 |
+ |
Annual payment for journals and magazines |
|
DATA |
7 |
1 if subscribes to electronic data service | |
|
ACRES |
100 acres |
7 |
Total crop acreage |
|
DEBT |
% |
+ |
Ratio of long-term debt payments to gross farm income |
|
FULL |
7 |
1 if a full-time farmer | |
|
COMP |
+ |
I if uses a computer | |
|
SALES |
$10,000 |
+ |
Average annual gross sales |
|
IRRlG |
+ . |
1 if irrigation is used | |
|
ALFALFA |
+ |
I if alfalfa is produced | |
|
PEANUT |
+ |
1 if peanuts are produced | |
|
COTTON |
+ |
I if cotton is produced | |
|
LOSS |
% |
+ |
Average annual weather-related crop losses as percent of sales |
|
CROPS |
7 |
Number of crop enterprises | |
|
YEARF |
IifIO years or less of farming experience | ||
|
YEAR2 |
+ |
1 if 11—20 years of farming experience | |
|
YEAR3 |
+ |
I if 21—30 years of farming experience | |
|
YEAR4 |
+ |
1 if 31^40 years of farming experience | |
|
YEARS |
+ |
I if more than 40 years of farming experience | |
|
EDUCla |
I if a high school graduate | ||
|
EDUC2 |
+ |
1 if some college education | |
|
EDUC3 |
+ |
I if a college graduate |
a These variables denote the reference category and were excluded from the models.
higher dollar, riskier enterprises. Large producers may also operate several noncontiguous
acreages. They might, therefore, be somewhat diversified against local adverse weather
events and less likely to perceive that weather information would lower their production
risk. Similarly, a manager of a more diversified farming operation—one with a larger number
of crop enterprises—is faced with a greater number of production decisions, many of which
are affected by weather. On the other hand, more diversified operations are also less risky.
As such, farmers with more enterprises may feel that they have a lower exposure to
weather-related production risks.
Characteristics of the producer such as ownership of a computer and subscription to a
data service or other news sources might also be expected to affect willingness to pay.
Computer ownership would be expected to increase willingness to pay, since the use of a
computer suggests an interest in technology and a ready ability to access computer-based
information. However, the expected impact of data service subscription is ambiguous.
Producers who subscribe to an electronic data service or other news services have a