Primavera Enterprise Project Portfolio (EPPM)

In Sections 3 and 4, the empirical framework of the U.S. beef and dairy models provided an useful welfare implications due to feed cost shocks. Likewise, results in these parts of the model provide a long run projections of the aforementioned markets. Those results, however, suffer from important limitations that must be acknowledged and discussed.

First, given the model is partial equilibrium, it is restricted to particular fields, beef and dairy sectors and ignores the effect of other livestock industries. For example,

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changes in hog and broiler markets can have a substantial impact on the beef and dairy sectors. Thus, the study lacks the interrelations among these parts of the economy. Second, the projected corn and soybean meal prices were exogenously

incorporated in the study. More appropriate way would be to merge the models into one and endogenously solve feed prices as well.

Third, the study pre assumed the structure of left hand side and the right hand side variables. However, Wang and Bessler (2006) argue that if price (quantity) is found to cause quantity (price), then quantity (price)-dependent functions can capture the fundamental market structure.

In Section 5, the values of whole algae and post extracted algae residue were determined and the main conclusion was that the value of whole algae is higher for aquaculture compared to the value of PEAR. However, it is difficult to accept the

conclusions that whole algal biomass is valued more than the PEAR as these two are not coming from the same species. Because there is no access to data that could compare the same species of both whole algae and PEAR, the improvement of the study will be left for the future research.

Moreover, the research ignored the fact that there can be algae-specific qualities that might influence the prices but are not reflected in hedonic methodology. This could either understate or overstate the true value of the feedstock.

In Section 6, the economic feasibility of biofuel and high value squalene production from tobacco was analyzed. Even though the research has interesting

176

implications, the study was analyzed on a small scale basis and generalizations of the results on a large scale basis might be arguable.

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