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Supply response and demand for basic grains in El Salvador

Author

Listed:
  • Rigoberto A. Lopez

    (Department of Agricultural and Resource Economics, University of Connecticut)

  • Hugo H. Ramos

    (Chemonics International, San Salvador, El Salvador)

Abstract

As in many developing nations, basic grains in El Salvador have a critical importance in the rural economy and in the daily diet. Information on price elasticities of supply and demand can be crucial for better informed policy making. This article pre-tests for the suitability of price expectation models and then estimates a market model for each grain. Empirical results point out strong inelasticities in demand and supply for all grains. For maize and red beans (but not for sorghum and rice), low degrees of partial adjustment indicate their high tendency to continue cultivation in spite of adverse economic conditions. © 1998 John Wiley & Sons, Inc.

Suggested Citation

  • Rigoberto A. Lopez & Hugo H. Ramos, 1998. "Supply response and demand for basic grains in El Salvador," Agribusiness, John Wiley & Sons, Ltd., vol. 14(6), pages 475-481.
    • Handle: RePEc:wly:agribz:v:14:y:1998:i:6:p:475-481
    DOI: 10.1002/(SICI)1520-6297(199811/12)14:6<475::AID-AGR5>3.0.CO;2-F
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    References listed on IDEAS

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    1. McCallum, Bennett T, 1976. "Rational Expectations and the Estimation of Econometric Models: AnAlternative Procedure," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 17(2), pages 484-490, June.
    2. Rigoberto A. Lopez, 1986. "The Use of Composite Price Expectations In Supply Response Models," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 34(3), pages 455-474, November.
    3. Goodwin, Thomas H & Sheffrin, Steven M, 1982. "Testing the Rational Expectations Hypothesis in an Agricultural Market," The Review of Economics and Statistics, MIT Press, vol. 64(4), pages 658-667, November.
    4. J. Scott Shonkwiler & Robert D. Emerson, 1982. "Imports and the Supply of Winter Tomatoes: An Application of Rational Expectations," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 64(4), pages 634-641.
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    Cited by:

    1. G. Benavides & P. N. Snowden, 2006. "Futures for farmers: Hedging participation and the Mexican corn scheme," Journal of Development Studies, Taylor & Francis Journals, vol. 42(4), pages 698-712.

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