An economic model for evaluating alternative government programs in rice
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1969
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Abstract
An economic model of the rice demand and supply relationships was developed that permits the estimation of domestic and export quantity-price relationships for rice and the determination of the effects of selected changes in government programs for rice on the cost to the United States Treasury. In addition, the effects of selected changes in government programs for rice on the resource requirements and returns for a selected representative Texas rice farm were examined as another aspect of the study. The demand model consists of equations for domestic food and industry markets, seed utilization, export market and farm-export price relationship. The equations were estimated from annual time series data. The period used in this analysis ran from 1934 through 1966 with the periods 1941 to 1945 and 1954 to 1958 removed. In the estimated demand equations the consistency of the signs and the relative magnitudes of the coefficients were compatible with a priori reasoning. Each coefficient was statistically significant, with the assumed 1970 conditions the farm level elasticity of demand for food and industry was -.14. The export market was slightly elastic at -1.57. The supply schedule of the model is a part of the regional rice adjustment study. The method of deriving the aggregate supply response consisted of defining a universe of farms, selecting a number of representative farms to represent the universe, and developing optimum plans for the representative farms by programming at variable prices for rice. The optimum plans were then expanded to derive an aggregated supply response for the universe. ...
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Major agricultural economics