A.M.S. {1980) subject classification: 20G 15.We summarize some standard results on G-invariants for morphic actions of G on an affine variety X. For more details on some of these results see [5,10,11,13]. These references generally deal with the case in which G is reductive (and hence connected). However, the extension to the case of non-connected G follows easily from the results of [17, pp. 57-60]. The references [10,11] deal with the characteristic-zero case, but many of the foundational results in these references carry over to characteristic p because of the affirmative solution of the Mumford Conjecture by Haboush. See the appendix to [11] for a discussion of this point.2.1. The quotient variety X/G. Let G act morphically on an affine variety X. Then the algebra of invariants k[X~\ G is a finitely generated /c-algebra. We denote by X/G the affine variety Spm^A'] 0 ) and by n x : X -> X/G the morphism of varieties corresponding to the inclusion homomorphism k[X] G -> /c [X]; when reference to G is necessary we write n x G instead of n x .The morphism n x has the following properties.2.1.1. The morphism n x is a surjective morphism.2.1.2. If V x and V 2 are disjoint, G-stable closed subsets of X, then there exists an invariant fe k[X] G such that / = 0 on V x and / = 1 on V 2 . (a)If c e X/G, then the fibre n x~l (£,) contains a unique closed orbit. We denote by T(£) the unique closed orbit in n x~l {Q.(b) n x determines a bijective mapping from the set of closed G-orbits on X to X/G.2.1.4. If V is a G-stable closed subset of X, then n x (V) is a closed subset of X/G. 2.1.5. The topology on X/G is the quotient topology. That is, a subset U of X/G is open if and only if n x~l (U) is open in X.

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The consumption of cigarette and tobacco products in Australia is modelled using the rational addiction theory of Becker and Murphy, augmented by data on advertising, regulatory intervention, and demographic factors. Over the past 35 years, price (including tobacco taxes), real income, and demographic effects explain most of the variation in tobacco consumption. Advertising by tobacco companies has had a relatively small direct effect on consumption. Work‐place smoking bans and health warnings on cigarette packs have had a relatively minor impact, while anti‐smoking advertising and bans on electronic media advertising have had no detectable direct effect.

A simple model is developed relating the debt and asset portfolio of the farm to the production decision, which leads to a small non-linear system of equations. The system is estimated with time-series cross-sectional data from Australian broadacre agriculture using non-linear three-stage least squares. This gives a new method of estimating risk aversion coefficients by using actual behaviour of farmers in a realistic economic environment, rather than games played in zrtificirl situations. Australian farmers are found to be risk averse, and the partial coefficient of risk aversion decreases with wealth and increases with income. The results are consistent with the results of studies by Binswanger in India and elsewhere using a completely different method. This consistency suggests that the partial risk aversion coefficient is a relatively robust measure of attitudes to risk.The behaviour of agricultural producers under risk has attracted a considerable degree of attention in the literature (see Newbery and Stiglitz 1981 for a comprehensive study). This is due to the uncertain nature of the enterprise, and the consequent focus of much of agricultural policy on risk reduction, including schemes for price stabilisation, insurance and underwriting. Developing appropriate methods for assessing attitudes to risk then becomes an important goal for research.Several different methods have been used to derive estimates of risk attitudes. The oldest is the attitudinal method, in which individuals are asked how they would act in various hypothetical risky situations, usually games of chance. Recent examples of this method are Dillon and Scandizzo (1 978), Bond and Wonder ( 1980), King and Robison (1 98 1) and Wilson and Eidman (1983). Binswanger (1981) has taken this further in a series of experiments in India in which individuals were offered gambles involving realistically large sums of money. Binswanger's experiments have been replicated in a number of other countries (Binswanger and Sillers 1983). The major criticism of these methods is that they are artificial, even when real money is used, and that they may offer poor guidance as to likely behaviour in a normal economic environment.* Peter Bardsley is now at the Department of Agricultural and Rural Affairs, EastMelbourne. An earlier version of this paper was presented at the 30th Annual Conference of the Australian Agricultural Economics Society, Australian National University, Canberra, 3-5 February 1986. A reviewer has drawn to the authors' attention a paper by Antle (1987), which addresses a similar problem. Antle also estimates risk attitudes econometrically from actual farm data. The main differences in approach are that Antle looks at input decisions and derives information on the distribution of risk attitudes in the producer population, whereas the approach presented here concentrates on the whole farm portfolio, and we derive parametric estimates of the influence of wealth and income on attitudes to risk. The authors would like to thank reviewers for their he...

The necessary conditions for the existence of a financially viable crop insurance scheme against drought are examined. A supply and demand model for crop insurance is developed which identifies the parameters that are critical to the efficiency of such a scheme. The values of these parameters are estimated by using data from the Australian wheat industry. It is found that crop insurance against drought would appear to be unattractive from an efficiency point of view.