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The Use of Expectations In Agricultural Supply Response

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  • Hazard, Suzanne
  • Shonkwiler, J. Scott

Abstract

A composite supply response model is formulated that has extrapolative and rational components as well as a partial adjustment mechanism. The model is applied to the Florida Watermelon Market to investigate how producers are forming their expectation of watermelon prices at harvest time. The results show that a dynamic cobweb mechanism is a valid representation of the data and suggests that producers are not using all the relevant information in the market.

Suggested Citation

  • Hazard, Suzanne & Shonkwiler, J. Scott, 1984. "The Use of Expectations In Agricultural Supply Response," 1984 Annual Meeting, August 5-8, Ithaca, New York 278895, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    • Handle: RePEc:ags:aaea84:278895
    DOI: 10.22004/ag.econ.278895
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    References listed on IDEAS

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    1. Pesaran, M. H., 1981. "Identification of rational expectations models," Journal of Econometrics, Elsevier, vol. 16(3), pages 375-398, August.
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    4. 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.
    5. 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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    7. Feige, Edgar L & Pearce, Douglas K, 1976. "Economically Rational Expectations: Are Innovations in the Rate of Inflation Independent of Innovations in Measures of Monetary and Fiscal Policy?," Journal of Political Economy, University of Chicago Press, vol. 84(3), pages 499-522, June.
    8. Sheffrin,Steven M., 1996. "Rational Expectations," Cambridge Books, Cambridge University Press, number 9780521474009, September.
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    11. Just, Richard E, 1977. "Estimation of an Adaptive Expectations Model," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 18(3), pages 629-644, October.
    12. Doran, H. E. & Griffiths, W. E., 1978. "Inconsistency of the OLS estimator of the partial adjustment-adaptive expectations model," Journal of Econometrics, Elsevier, vol. 7(2), pages 133-146, June.
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