Spatial allocation and the shadow pricing of product characteristics

Abstract

The paper considers an industry transforming primary commodities (farm products) into processed commodities (food products). It focuses on the allocation of embedded characteristics (carbohydrate, protein, etc.) both across space and among commodities. The approach generates a spatial competitive market equilibrium of production, consumption, transformation, and trade for both primary and processed commodities, along with the spatial distribution of shadow prices for the product characteristics. The model provides a basis for analyzing the allocation and pricing of agricultural products, food products, and characteristics in spatial markets. The empirical usefulness of the model is illustrated in the context of regional resource allocation in the U.S. dairy sector.

Efectos de la aplicación de aranceles ad valorem sobre importaciones de carne bovina en México

“…La utilidad de estos modelos se centra en simular el efecto que tiene en los mercados, la aplicación de medidas de comercio internacional, como cuotas de importación (Rebollar y Posadas, 2023), aranceles ad valorem (impuestos), cuotas compensatorias ad valorem, embargos, economías cerradas, etc. El modelo de equilibrio espacial, se ha utilizado para analizar la competencia interregional y regional en productos agropecuarios, por ejemplo en la industria lechera en Estados Unidos (Chavas, Cox y Jesse, 1993;Yavuz , Zulauf., Schnitkey y Miranda, 1996), en el sorgo mexicano (Rebollar, Hernández y Guzmán, 2016), importaciones de maíz en México (García y Santiago, 2004), en la porcicultura de México (Velázquez, Gómez, Rebollar y Martínez, 2016;Almazán, Rebollar, Velázquez, Gómez y Hernández, 2018), el mercado regional de leche en Japón (Kawaguchi, Suzuki y Kaiser, 1997) y sobre el mercado de la carne de pollo en México .…”

Energy price reform and food markets: the case of bread supply chain in Iran

“…Hence, a spatial model is required to be adopted. To our knowledge, Chavas, Cox and Jesse (CCJ) () initially extended the spatial equilibrium model of Samuelson, Takayama, and Judge (Samuelson, ; Takayama and Judge, ) to a vertical model, incorporating primary as well as processed commodity for analyzing the regional allocation of U.S dairy supply chain. After CCJ (1998) many studies, e.g., Zhu et al., (); Cox and Chavas, (); Bouamra‐Mechemache et al., () and Abbassi et al., () used this framework to evaluate the impacts of various policies in the dairy sector around the world.…”