Analysis Of Supply Response Research Articles

An Empirical Analysis of Supply Response of Food Grains to Changes in Price: Evidence from India

The issue of food production is very important as it affects growth, food security and poverty. Stable food grain price is also important to have a stable food grain market. This article attempts to study the impact of food price fluctuations on food production based on the annual data from 1962 to 2019 by using Non-linear Auto Regressive Distributed Lag model. The results show that changes in food grain price affects grain production and it is statistically significant. Furthermore, the result of asymmetric cointegration test shows that there is a long-run asymmetric relationship that exists between food production and food grain price. JEL Codes: Q11, C01, C32

Analysis of growth rate and supply response of cocoa in Tamil Nadu, India: Nerlovian adjustment model

The present study focussed on the growth rate of area, production and productivity of cocoa in Tamil Nadu and estimated the impact of cocoa allocation decision, price variation and its supply in selected districts. The study employed the CAGR, Nerlovian model using the secondary data from 2011-12 to 2020-21. A positive significant growth in the area (40.24%) and production (34.60%) was witnessed in the Coimbatore district, while Thanjavur district showed a decline in the growth rate of cocoa. The area response concluded by lagged values of area and price significantly influenced the current year area in Coimbatore. The lagged productions were positively significant for both the districts and inferred that the increase in the price with one per cent level with the respective rise in price variability in Coimbatore district and opposite trend in Thanjavur district. The study suggested improving cocoa productivity and smoothing out variability in domestic prices can help boost farmers’ confidence in cocoa cultivation. The government provided the subsidy for transportation of the beans from one place to another, procurement centres in cocoa growing districts in Tamil Nadu and supplying the HYV to increase production, developing crop insurance schemes for cocoa during uncertain conditions and establishing facilities for the distribution of beans through Farmer Producer Companies (FPO), as well as attracting foreign consumers by improving bean quality.

Economic Analysis of Supply Response of Summer Maize crop in Egypt

Economic Analysis of Supply Response of Summer Maize crop in Egypt

An Economic Analysis of Supply Response for the Lentil Crop in Egypt

An Economic Analysis of Supply Response for the Lentil Crop in Egypt

Supply Response Analysis of Gram in the Context of Prices and Non-Prices Factors in Punjab, Pakistan

Supply Response Analysis of Gram in the Context of Prices and Non-Prices Factors in Punjab, Pakistan

Do Erratic Rainfalls Hamper Grain Production? Analysis of Supply Response of Rice to Price and Non-Price Factors

Increasing rice production has become one of the ultimate goals for South Asian countries. The yield and area under rice production are also facing threats due to the consequences of climate change such as erratic rainfall and seasonal variation. Thus, the main aim of this work was to find out the supply response of rice in Malaysia in relation to both price and non-price factors. To achieve this target, time series analysis was conducted on data from 1970 to 2014 using cointegration, unit root test, and the vector error correction model. The results showed that the planted area and rainfall have a significant effect on rice production; however, the magnitude of the impact of rainfall is less conspicuous for off-season (season 2) rice as compared to main-season rice (season 1). The speed of adjustment from short-run to long-run for season-1 rice production is almost two-and-a-half years (five production seasons), while for season-2 production, it is only about one-and-a-half year (three production seasons). Consequently, the study findings imply the supply of water to be enhanced through better water infrastructure for both seasons. Moreover, the area under season 2 is continuously declining to the point where the government has to make sure that farmers are able to cultivate the same area for rice production by providing uninterrupted supply of critical inputs, particularly water, seed and fertilizers.

Economic Analysis of Supply Response of Broad Beans Crop in Egypt

The Broad beans crop in Egypt is considered a major source of food for a great number of the population, in recent years its prices have witnessed a significant increase , despite it being considered an alternative to animal protein, whose prices have also witnessed a huge increase. This research aims to study the supply response of Broad beans crop in Egypt, through studying the production and economic indicators, also identifying the most important variables impact on response of the cultivated area, and estimating the degree of response for most important variables which impact on the response of cultivated area of Broad beans crop in Egypt, besides estimate the annual amount of response to reach the period necessary to achieve a full response. The results showed that the cultivated area with Broad bean has taken a general and statistically significant decreasing trend, reached 11.14 thousand acres, with an annual decrease rate 7.57% of the cultivated area average. The results of the supply response function also indicated that there is a logical inverse relationship between each of Broad beans cultivated area (as a dependent variable) and the farm price of lentil, Clover, Chickpeas, Flax and Onion with Egyptian pounds in the previous year (as explanatory variables).

Supply Response Analysis on the Impact of Climate Change on Oil Palm Production in Malaysia

Climate change has significantly impact the economic development and trade of developing countries particularly those largely rely on agriculture. According to the World Bank, oil palm was the main contributor of GDP for Malaysia agriculture. Climate change affects oil palm growth and productivity in a number of ways, including reduction in sex-ration, disrupts the pollination process, abortion of newly produced inflorescence, drops in productivity, and increase in ranges and distribution of pests and diseases. Much of the economic researches devoted to employ production function and Ricardian approach. This study, therefore, focuses to model the effect of climate change on oil palm production by using supply response approach. An annual time series data used for the period of 37 years starting from 1980 until 2016, and Autoregressive Distributed Lags (ARDL) co-integration_-employed in achieving the objective of the study. Six econometric models consisting of linear and non-linear equations were constructed by incorporating temperature and rainfall as proxies for climate variable to estimate the yield response model. The results revealed that oil palm production was very negatively affected by changes in temperature compared to changes in rainfall. Meanwhile, the planted area and own price upsurge the supply of palm oil. The results also indicated that Model 3 and Model 6 were the best model to represent the linear and non-linear effect of climate_change on oil palm production, respectively. Quantifying the impact of climate change on palm oil production can help policy makers and relevant stakeholders to determine the best adaptation and mitigation measures.

Analysis of supply response of black tiger shrimp production using Nerlove model

Analysis of supply response of black tiger shrimp production using Nerlove model

Supply Response Analysis Of Indonesian Cocoa

The Supply response of cocoa in Indonesia is done through an approach to the area of cocoa plantations, in response to economic factors and non-economic factors. Data analyzed from 1985 to 2015 (time series). The aim is to find out the factors that affect the area of cocoa plantations in Indonesia and the response of the offer of cocoa in Indonesia seen from the value of short-term elasticity and long-term elasticity. The partial adjustment and adaptive expectation model was applied and continued with an analysis of Seemingly Unrelated Regression Equations (SURE). The results of the analysis show that the factors affect the area of cocoa plantations in Indonesia are on smallholder plantations, namely coffee prices, rubber prices, and technology. In the state plantations, namely the previous year's cocoa plantation area, rubber prices, technology, and government policy. In private plantations, namely rubber prices, technology, and labor costs. Supply response of cocoa that is in line with the value of elasticity both short and long term is inelastic which means that it is following expectations, where the value of long-term elasticity is greater than the value of short-term elasticity

Analysis of Supply Response and Price Risk on Rice Production in Nigeria

Nigeria is among many African countries that have engaged in agricultural liberalization since 1986 in the hope that reforms emphasizing price incentives will encourage producers to respond. Hitherto, the reforms seem to have introduced greater uncertainty into the market given increasing rates of price volatility. Methodology: This study, therefore, models supply responses in Nigerian Rice production that include the standard arguments as well as price risk. Statistical information on domestic and imported quantities of rice was obtained for 41 years (1970 to 2011) from the AGROSTAT system of the statistical division of the Food and Agriculture Organization (FAO), Federal Ministry of Agriculture statistical bulletins, Central Bank of Nigeria statistical bulletins and National Bureau of Statistic. (NBS). Results: The data are analyzed using descriptive, equilibrium output supply function and co-integration models and vector autoregressive distributed lag. Rice importation showed a negative sign and was statistically significant with changes in output also responsive to changes in price. Conclusion: The results indicate that producers are more responsive not only to price and non-price factor but to price risk and exchange rate. It is therefore imperative to reduce price risk as to increase the response of producer to supply by bridging the gap in production.

Supply Response Analysis of Wheat Growers in District Swabi, Khyber Pakhtunkhwa: Farm Level Analysis

Supply Response Analysis of Wheat Growers in District Swabi, Khyber Pakhtunkhwa: Farm Level Analysis

English

This study aimed to investigate the impacts of fluctuations in agricultural production, consumption and marketing bottlenecks on main food prices in Gadarif State, east of Sudan in the period of 1996 to 2011. On the supply side, an adjusted Nerlovian model of supply response was used to calculate elasticities of prices of selected agricultural products. On the consumption side, the distribution of the agricultural supply among local consumption and external export was analyzed. The price margin of these products was calculated to explain how this margin is shared by the different market players. With reference to results of this study, supply response analysis of sorghum and sesame showed that production did not respond to finance or price factors, indicated by the low elasticities. Analysis of marketing channels of the above crops showed that the various fees and taxes imposed on different crops have weakened the competitiveness of export of these crops and hindered farmers from gaining reasonable revenues. Thus, prices of these crops in some seasons exceeded the world prices. Results of the price margin showed that the real producers receive the minimum price margin as compared to the other market players. Key words: Supply response, price margin, market channels, agricultural surplus, competitiveness. &nbsp

Supply response analysis of tobacco growers in Khyber Pakhtunkhwa: An ARDL approach

This study estimated the supply response of tobacco growers to price and non-price variables in Khyber Pakhtunkhwa by using Auto Regressive Distributed Lags (ARDL) approach. The study used time series data for the time period of 1981–2014. Augmented Dicky Fuller (ADF) test was employed to check order of integration of all the variables which found a mixture of stationarity of variables. Bounds test confirmed the existence of long run relationship between variables. Therefore ARDL approach was used for the estimation of short run and long run elasticities. The estimated short run elasticities of lagged production, tobacco price, tobacco area were positive and statistically significant while that of wheat price (competing crop) was negative and statistically significant. The estimated value of error correction term which measures the speed of adjustment was −0.61; implies that any shock to the system returns back to its equilibrium by 61 percent each year. The estimated long run elasticities of tobacco price and tobacco area were positive and statistically significant while that of wheat price (competing crop) was negative and statistically significant. It can be concluded that tobacco growers are responsive towards price variable in the long run therefore an increase in tobacco price will boost up tobacco production in the country. In short run, allocation of more area to tobacco crop is a tool for enhancing tobacco production.

An Empirical Analysis of Supply Response of Rubber in Malaysia

Supply response of rubber to changes in economic incentives is analysed using co-integration approach. Time series data is taken for the period 1990 to 2014 and the vector error correction model framework has been applied. The empirical results confirmed the existence of a unique long-run equilibrium relationship among planted acreage, the relative price of rubber and price of fertilizer. Further, the estimates suggested that rubber supply is significantly influenced by the relative price of rubber and the price of fertilizer. The estimated short- and long-run elasticities of acreage with respect to relative price are respectively 0.04 and 0.77, while the short- and long-run elasticities of acreage with respect to fertilizer price are -0.20 and -0.28 respectively. The study recommends the design of an appropriate economic incentive structure to stimulate output and hence the income of farmers.

Price formation and supply response of natural rubber

Natural rubber is a major economic plant in the plantation sector in terms of providing income to the growers for a long-time and also it serves as raw materials for various industrial products. Over 20 million families are dependent on rubber cultivation for their livelihood in the world natural rubber market. Natural rubber price is influenced by many factors such as weather, currency exchange rates, oil prices, policy changes in major rubber producing and consuming countries. The specific objective of the study was to identify the factor responsible for price formation and supply response of natural rubber. The result shows that the price formation of natural rubber revealed that the futures price, international price, and synthetic rubber price were statistically significant where as crude oil price and exchange rate were non-significant. From supply response analysis, it was inferred that price was a significant factor explaining output growth. The analysis confirmed that lagged price exerted a positive influence on natural rubber area.

A panel cointegration analysis and dynamic causality test of agricultural supply response to prices: The case of rice in West Africa

The paper provides a regional estimate of rice yield and acreage supply response to prices in West Africa. Using balanced panel data of seven countries covering 1991–2006, the study employs panel cointegration estimators, namely FMOLS and DOLS to estimate the long-run rice yield supply function and using one-step Blundell-Bond system GMM to estimate the short-run acreage supply function in the region. While the empirical findings from both estimators provide similar results, the estimates show that price of maize is a key determinant of rice yield and acreage and there is rice-maize substitutability in both the long-run and short-run in the study. The short-run Granger causality runs only from maize price to rice acreage, while long run causality of joint effect of the prices on the acreage supply is also evident in the study. Our results also show that the rice yield and acreage supply functions are unresponsive to own price in the short -run and long -run, respectively.

Evaluating the effect of price and non-price policy intervention on rice cultivation in Sierra Leone: A supply response model approach

Rice is the main food for over 95 percent of the Sierra Leonean populace. It accounts for the largest portion of the agricultural GDP of the country. On the contrary, its cultivation has been shrinking over the past decades. Consequently, importation now becomes the main source of supplying the grain for local needs since its cultivation or production could no longer meet domestic request. The deterioration in the local cultivation of rice has had severe socio-economic implications such as higher consumer prices and balance of payment burden. Therefore, the main objective of this study is to evaluate the effect of price and other related nonprice policy intervention on rice cultivation in the country. The tools utilized for analyzing the problem comprise, a coefficient of protection analysis as well as a supply response analysis by means of a time series regression (for the period 1980-2011). Major limitations established negatively affecting rice output are price disincentives to cultivators, public expenditure and fertilizer consumption. From the above findings, rice cultivators should be accorded the necessary incentives to keep them more effective in the rice cultivation career. The food policy approach that had over the years depended on huge importation of rice should be reviewed in favor of domestic cultivation. Increasing local cultivation through a meaningful protection of cultivators can independently reduce the price of rice to the advantage of the final consumers. This study also recommends that public funds should be redirected away from rice import toward investments in its domestic cultivation.

Supply Response Analysis of Rice Growers in District Gujranwala, Pakistan

The study was designed to estimate the restricted profit function in district Gujranwala, Punjab, Pakistan. Data were collected from 100 respondents using proportional allocation sampling tech-nique. The analysis was done using SHAZAM software. The results indicate that the farmers are price-responsive. Rice own price elasticity was 1.873. The output supply elasticity of rice with re-spect to education, land, fertilizer price and irrigation cost were 0.0.169, 1.274, -0.873 and -0.953 respectively. Irrigation demand elasticity with respect to education, land, fertilizer price, irrigation cost and output price were 0.14, 1.14, -0.783, -1.84 and 1.78 respectively. Fertilizer demand elasticity with respect to education, land, fertilizer price, irrigation cost and output price was 0.023, 0.792, -1.65, -0.85 and 1.851 respectively. Lastly, the elasticity of profit with respect to education, land, fertilizer price, irrigation cost and output price was 0.20, 1.10, -0.83, -1.136 and 1.92 respectively. The study recommends that Government should provide consistent electricity with stable rates, so that, they irrigate their fields through electric tube wells and ultimately their cost of irrigation decreases. The study also suggests that government should stabilized fertilizer prices to encourage its application. Furthermore, government should raise procurement price of rice to encourage its supply this; it in turn will also increase the profit of the farmer.

Supply Response Analysis of Pakistani Wheat Growers

Alternative specifications of model of supply response of Pakistani wheat growers and their economic implications are considered in terms of the existences and nature of production lags, and the choice between expected wheat and gross returns as the preferred explanatory of producer’s response to changing economic condition. Data were collected from 1961-2008 by using time series analysis and data were analysis by using SPSS-16.5 version. The analyses indicate that there are lags which are due primarily to the difficulties and cost of rapid adjustment rather than to the time required to revise expectations. The statistical results were similar for the alternative specification of gross margins and wheat as the economic decision available. However, the wheat elasticities derived using the gross margins specification were about a third of those using the wheat specification. The paper used data by using the time series analysis of Wheat response analysis. A longitudinal in depth study is needed for the decision analysis. The gross margin specification yielded additional information in the form of yield and input cost elasticities.The clarified concept of Wheat response analysis presented. Also, the systematized the factors is introduced and tested empirically.