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Supply Response In The Australian Sheep Industry: A Case For Disaggregation And Dynamics

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  • Reynolds, R.G.
  • Gardiner, B.

Abstract

Microeconomic capital goods theory was utilised to provide a theoretical framework on which a dynamic econometric model was based. Econometric procedures were then employed in an analysis of sheep producers' decision making regarding the annual supplies of wool, lamb and mutton, and annual changes in the inventory levels of sheep, lambs and ewes maintained for breeding purposes. Estimates show that wool prices provide the long-run stimulus for increases and decreases in the sheep flock while mutton and lamb prices are responsible for short-run changes in flock composition. Substitution between sheep and beef cattle is of considerable importance although no significant substitution between sheep and cropping could be found. Seasonal conditions proved to be an important short-run supply shifter, affecting both numbers and composition of the sheep flock.

Suggested Citation

  • Reynolds, R.G. & Gardiner, B., 1980. "Supply Response In The Australian Sheep Industry: A Case For Disaggregation And Dynamics," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 24(3), pages 1-14, December.
    • Handle: RePEc:ags:ajaeau:22910
    DOI: 10.22004/ag.econ.22910
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    References listed on IDEAS

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    1. Jarvis, Lovell S, 1974. "Cattle as Capital Goods and Ranchers as Portfolio Managers: An Application to the Argentine Cattle Sector," Journal of Political Economy, University of Chicago Press, vol. 82(3), pages 489-520, May/June.
    2. Freebairn, John W., 1973. "Some Estimates of Supply and Inventory Response Functions for the Cattle and Sheep Sector of New South Wales," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 41(02-3), pages 1-38, June.
    3. Gutman, G.O., 1955. "Investment and Production in Australian Agriculture," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 23(04), pages 1-74, December.
    4. Shlomo Reutlinger, 1966. "Short-Run Beef Supply Response," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 48(4_Part_I), pages 909-919.
    5. B. H. Court, 1967. "Supply Response of New Zealand Sheep Farmers," The Economic Record, The Economic Society of Australia, vol. 43(2), pages 289-302, June.
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    Cited by:

    1. Vere, David T. & Griffith, Garry R., 1988. "Supply and Demand Interactions in the New South Wales Prime Lamb Market," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 56(03), pages 1-19, December.
    2. Fisher, Brian S. & Munro, Robyn G., 1983. "Supply Response In The Australian Extensive Livestock And Cropping Industries: A Study Of Intentions And Expectations," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 27(1), pages 1-11, April.
    3. McCarl, Bruce A., 1984. "Model Validation: An Overview with some Emphasis on Risk Models," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 52(03), pages 1-21, December.
    4. Vere, David T. & Griffith, Garry R. & Bootle, B.W., 1993. "Alternative Breeding Inventory Specifications In A Livestock Market Model," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 37(3), pages 1-24, December.
    5. Phororo, Hopolang, 1996. "The Supply Of Wool In Lesotho," Agrekon, Agricultural Economics Association of South Africa (AEASA), vol. 35(1), March.
    6. Farrell, Terence C. & Tozer, Peter R., 1996. "Strategic Alliances and Marketing Cooperatives: a Lamb Industry Case Study," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 64(02), pages 1-10, August.

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