IDEAS home Printed from https://ideas.repec.org/p/ias/cpaper/84-wp7.html
   My bibliography  Save this paper

Econometric Simulation Model for Analyzing the Use of Funds in Corn Belt Agriculture: An Application of Pure Random Coefficient Technique, An

Author

Listed:
  • R. Thamodaran
  • Earl O. Heady
  • Raymond J. Schatzer

Abstract

The purpose of this study is to develop an econometric simulation model for analyzing the use of funds in Corn Belt agriculture. The Corn Belt Region, one of the major regions in U.S. agriculture, constitutes states such as Iowa, Illinois, Indiana, Missouri, and Ohio. A set of behavioral functions of the use funds in the region are specified to accomplish this task. Fixed expenditures, production expenditures, and land transfers are the major categories of the use of funds. Further, the behavioral equations are specified by a pure random coefficient technique and estimated by following Zellner's seemingly unrelated technique. Based on the estimated behavioral functions and accounting identities, a simulation system of the use of funds is developed and an ex-post simulation is performed to test the validity of the model. To test its effectiveness, the model analyzes several farm policy alternatives on the use of funds, such as a 25 percent increase in prices paid indexes, a 50 percent increase in prices received indexes, and a 10 percent reduction in crop planted acres over the normal trend of these variables. An ex-ant simulation to the year 1995 is performed under the policy alternatives. Various farm financial indicators, such as production expenditures, fixed expenditures, farm debt, and credit demand are studies under these policy alternatives.

Suggested Citation

  • R. Thamodaran & Earl O. Heady & Raymond J. Schatzer, 1984. "Econometric Simulation Model for Analyzing the Use of Funds in Corn Belt Agriculture: An Application of Pure Random Coefficient Technique, An," Center for Agricultural and Rural Development (CARD) Publications 84-wp7, Center for Agricultural and Rural Development (CARD) at Iowa State University.
  • Handle: RePEc:ias:cpaper:84-wp7
    as

    Download full text from publisher

    File URL: https://www.card.iastate.edu/products/publications/pdf/84wp7.pdf
    File Function: Full Text
    Download Restriction: no

    File URL: https://www.card.iastate.edu/products/publications/synopsis/?p=729
    File Function: Online Synopsis
    Download Restriction: no
    ---><---

    Other versions of this item:

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ias:cpaper:84-wp7. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/caiasus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.