Auctions where landholders submit conservation projects for consideration in return for payment have recently gained popularity. Flexible versions of these, combinatorial auctions, which allow for the simultaneous submission of bids on different combinations of projects, have recently been tested for conservation purposes. Combinatorial auctions allow bidders to exploit synergies in the execution of multiple conservation activities while the auction mechanism stimulates competition among potential participants, enabling the auctioneer (or government) to secure a cost-effective set of conservation projects. Combinatorial auctions have the potential to improve outcomes beyond what is possible with the simple auctions explored in trials over the last decade in many parts of Australia. This article reviews the state of the art in the design of combinatorial auctions with a particular focus on conservation auctions. Key design issues identified are the problem of determining the winning bid, pricing formats, and iterative bidding formats where bidders are able to revise their bids before a final selection is made.

As private plant breeding replaces public programs, the efficient provision and utilisation of key enabling technologies for crop breeding, which are largely knowledge based and provide the foundation for variety improvement, might be at risk. Typically, such inputs are non-rival in use and are therefore termed essential plant breeding infrastructure (EPBI). Specific threats include the possibility of wasteful duplication in production, under-production, under-utilisation of produced EPBI because of price rationing, and anticompetitive outcomes in plant breeding and downstream markets. The likely level of under-investment in hypothetical molecular-marker technology by a profit-maximising monopoly producer, charging uniform prices for access, is analysed using results from the published literature on excludable public goods.

This chapter reports the findings from some preliminary analyses of the impact on prices at farm gate and at retail of introducing a system of retail labelling of non-genetically modified food. Of interest here is the nature of market segmentation and price differentiation after a first generation genetically modified (GM) crop (rape, in this example) is produced and marketed. The simple model presented explores some possible scenarios for future prices for GM and non-GM rape under a few key assumptions. First, the GM crop is of the first generation such that consumers will not purchase food produced using GM rape unless it is sold at a lower price than conventional rape. Clearly the model would need to be adjusted to allow for any positive attributes associated with GM foods, such as those in second and third generation GM foods. Secondly, the production function for both types of foods is assumed to be constant returns to scale with a constant elasticity of substitution. The market is characterized by perfect competition. Identity preservation costs are presented as simple fixed costs in each market.

In this study, we derive stochastic models of population dynamics and devise a new method of estimating the models. The models allow growth and harvest to be nonlinear functions of stochastic processes and the error terms to be nonlinear and heteroskedastic. Ordinary least-squares estimates would be biased and inefficient and generalized leastsquares estimates cannot be calculated. Therefore, we implement nonlinear maximum likelihood methods to find unbiased and efficient estimates of parameters. The method is applied to the population dynamics of kangaroos in South Australia. Aerial survey data of kangaroo numbers are combined with harvest, effort and rainfall data to estimate the growth and harvest functions and the variances of the stochastic processes which drive the system. Results suggest that growth and harvest should be modeled as functions of stochastic processes and that observations on kangaroo numbers are critical for estimating population dynamics. The results also indicate that the estimation method works well and is a viable alternative to ARIMA and GARCH models, particularly for small data sets.

This special issue of the Australian Journal of Agricultural and Resource Economics contains papers that address a wide range of economic and policy issues involving use and/or conservation of water. Around the world, water allocation has become a significant policy issue in recent years, and agricultural and resource economists have responded with increased contributions to the policy debate. With this in mind, the editors decided to invite submissions of water-related papers, which ultimately led to this special issue. The countries represented as subjects of the various papers are Australia, New Zealand, Italy, Spain, and, if we consider the two book reviews, Chile and the United States. Most papers have an Australian focus. Byrnes et al .