The rapid upward shift in ethanol demand has raised concerns about ethanol’s impact on the price level and volatility of agricultural commodities. The popular press attributes much of this volatility in commodity prices to a price bubble in ethanol fuel and recent deflation. Market economics predicts not only a softening of demand to high commodity prices but also a positive supply response. This volatility in ethanol and commodity prices are investigated using cointegration, vector error corrections (VECM), and multivariate generalized autoregressive conditional heteroskedascity (MGARCH) models. In terms of derived demand theory, results support ethanol and oil demands as derived demands from vehicle-fuel production. Gasoline prices directly influence the prices of ethanol and oil. However, of greater significance for the fuel versus food security issue, results support the effect of agricultural commodity prices as market signals which restore commodity markets to their equilibriums after a demand or supply event (shock). Such shocks may in the short-run increase agricultural commodity prices, but decentralized freely operating markets will mitigate the persistence of these shocks. Results indicate in recent years there are no long-run relations among fuel (ethanol, oil and gasoline) prices and agricultural commodity (corn and soybean) prices.

This article investigates the time allocation choices of US workers between farm work and other job alternatives. Results indicate that green card farm workers tend to allocate fewer workweeks to farm employment than citizens and undocumented workers, in favour of better opportunities in the non-farm sector. There is evidence of an assimilation effect, whereby undocumented workers also tend to re-allocate their time from farm to non-farm employment as their residence tenure increases, even though they experience constrained mobility and visibility during periods of strict immigration control. In the context of employers’ violations of the existing labour laws that currently protect even the rights of undocumented workers, such turnover decisions seem justified. The findings raise concerns about whether any governmental effort to legalise the immigration status of such workers would reduce farm job turnover rates and increase farm employment retention, so long as labour standards are not enforced. Moreover, external economic shocks could more easily induce citizen and green card farm workers to abandon farm employment, whereas undocumented workers tend to remain in their farm jobs during such difficult times.