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The Department of Environmental Economics and Management

The Robert H. Smith Faculty
of Agriculture, Food and Environment
The Hebrew University of Jerusalem

PO Box 12, Rehovot 76100
Fax: 08-9466267

Department Head:
Prof. Ayal Kimhi, Tel: 08-9489376

Head of the teaching program:
Prof.Iddo Kan, Tel: 08-9489233

Miri Arazi, Tel: 08-9489230


Bar-Nahum, Z. ; Finkelshtain, I. ; Ihle, R. ; Rubin, O. D. Effects of violent political conflict on the supply, demand and fragmentation of fresh food markets. 2020, 12, 503 - 515. Abstract
Violent political conflict has been documented to have comprehensive adverse effects on economic activity and, thus, substantially harm social welfare. As conflict escalations are often reported to fragment economic space, we suggest an empirical framework which allows for estimating changes in the size of markets often split by frontlines. This approach uses a differentiated goods oligopoly model to separate effects of conflict intensity on consumer demand, costs of trade, market size, and market structure. We combine daily sales of apples in Hebron - one of the focal points of the Israeli–Palestinian conflict - and variables quantifying complementary aspects of conflict intensity. Conflict is found to suppress demand and affect competition more significantly than it increases costs of trading. Simulations indicate a 15% reduction in total daily consumption during conflict of high intensity while a pacification would yield a 20% welfare gain. This empirical framework allows disentangling the effects of conflict on food markets. The results suggest that relief policies should consider alleviating effects of fragmentation of economic space, e.g., by ensuring humanitarian corridors.
Talev, E. ; Bar-Nahum, Z. ; Fleischer, A. ; Tchetchik, A. Is agriculture important to agritourism? The agritourism attraction market in Israel. European Review of Agricultural Economicserae 2018, 45, 273 - 296. Abstract
Agritourism attractions are a commonly chosen alternative in farm diversification. Some attractions are based on active farms, while others are based on rural ambience. We model and estimate the agritourism attraction market as a differentiated-goods market based on Israeli market data and simulate different scenarios. We show that total welfare increases when attractions are based on rural ambience rather than on active farms. We also show that an indirect support scheme has a stronger impact on total welfare than a direct scheme.