A Simultaneous Equation Approach to Production Response: Delta Region

Abstract

Soybeans occupy the unique position of common denominator in crop production for much of the Eastern half of the U.S. The interdependence between the soybean economy and those of corn, cotton, and rice means that policy changes directed toward one crop can have very decided effects upon the others.Effective policy and program decisions need continuing research as input in formulating and evaluating these decisions. Detailed analyses of inter- and intraregional interdependence among crops, and of production alternatives involving soybeans, are especially needed because it is no longer certain that an expanding demand will provide a safety valve for soybean and related commodity programs [4,9].

An Examination of Major Crop Acreage Response

“…Diversion provisions provided the Least Squares (JGLS), since it was possible that *nodsuac might becontmpor o uy most direct means of obtaining short-term acreage random disturbances might be contemporaneously Support rate provisions provided an altercorrelated across equations. 5 Several alternative changes. Support rate provisions provided an altercorrelated across equations.5 Several alternative ntial in acreage -' .…”

Regional acreage response functions for major US field crops: estimation and policy implications

“…G. Collins (1980), Heady and Rao (1967), Hoffman (1973), Houck, Ryan, and Subotnik (1972), Morzuch, Weaver, and Helmberger (1980), Neenan (1981), Penn and Irwin (1971), Whittaker and Bancroft (1979), and Winter and Whittaker (1979), have made important contributions to regional acreage response analysis. However, with a few exceptions, these studies tend to be variables which measure expected price, the impact of government pro grams, and the effect of risk and uncertainty upon acreage response (Burnstein, 1980).…”

“…Mann, 1973;Meyers and Hacklander, 1979;R. Miller, 1979;Neenan, 1981;Penn and Irwin, 1971;Rao, 1965;Ray, 1971;Ray and Heady, 1974;Reed and Rigglns, 1981;Reynolds, Heady, and Mltchel, 1975;Salathe, Price, and Gadson, 1982;Schatzer, Roberts, and Heady, 1981;Walker and Penn, 1975;Whittaker and Bancroft, 1979;Winter and Whittaker, 1979). Despite its frequent use, the adaptive expectations model is criticized for the lack of a theoretical basis for the geo metrically declining lag structure (Grillches, 1967;Lin, 1977), the assumed constancy of the coefficient of expectation 3, and the neglect of current price information (Lin, 1977 tfc f where p^ is the expected price, p^ ^ is the actual farm price, p^ is the effective support price, and w^, w^ are weights, with w^ + = 1.…”

“…The estimates in Table 5.1 are 0.002 for spring wheat and 0.13 for winter wheat (the dominant type). Penn and Irwin (1971) estimated the own price elasticity of soybean, cotton, and corn acreage responses in the Delta Region to be 0.16, 0.36, and -0.13, respectively. The Table 5.1 estimates for these same crops are 0.20, 0.60, and 0.08, respectively.…”

Regional acreage response functions for major US field crops: estimation and policy implications

“…Regional acreage response modeling is not a new idea. G. Collins (1980), Heady and Rao (1967), Hoffman (1973), Houck, Ryan, and Subotnik (1972), Morzuch, Weaver, and Helmberger (1980), Neenan (1981), Penn and Irwin (1971), Whittaker and Bancroft (1979), and Winter and Whittaker (1979), have made important contributions to regional acreage response analysis. However, with a few exceptions, these studies tend to be…”