A model of commodity prices after Sir Arthur Lewis
AbstractWe develop an idea from Arthur Lewis’ paper on unlimited supplies of labor to model the longrun behavior of the prices of primary commodity produced by poor countries. Commodity supply is assumed infinitely elastic in the long run, and the rate of growth of supply responds to the excess of the current price over the long run supply price. Demand is linked to the level of world income and to the price of the commodity, so that price is stationary around its supply price, and commodity supply and world income are cointegrated. The model is fitted to long-run historical data.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Princeton University, Woodrow Wilson School of Public and International Affairs, Research Program in Development Studies. in its series Working Papers with number 201.
Date of creation: Jun 2002
Date of revision:
Contact details of provider:
Postal: 208 Fisher Hall, Princeton, NJ 08544
Phone: (609) 258 - 6403
Fax: (609) 258 - 5974
Web page: http://www.princeton.edu/%7Erpds/index.html
More information through EDIRC
Commodity prices; Sir Arthur Lewis; World income; Cointegration;
Other versions of this item:
- Deaton, Angus & Laroque, Guy, 2003. "A model of commodity prices after Sir Arthur Lewis," Journal of Development Economics, Elsevier, vol. 71(2), pages 289-310, August.
- Angus Deaton & Guy Laroque, 2002. "A Model of Commodity Prices after Sir Arthur Lewis," Working Papers 2002-19, Centre de Recherche en Economie et Statistique.
- E3 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles
- F1 - International Economics - - Trade
- O1 - Economic Development, Technological Change, and Growth - - Economic Development
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Halvorsen, Robert & Smith, Tim R, 1991. "A Test of the Theory of Exhaustible Resources," The Quarterly Journal of Economics, MIT Press, vol. 106(1), pages 123-40, February.
- Deaton, Angus & Laroque, Guy, 1996. "Competitive Storage and Commodity Price Dynamics," Journal of Political Economy, University of Chicago Press, vol. 104(5), pages 896-923, October.
- Heun, Michael & Schlink, Torsten, 2004. "Early warning systems of financial crises: implementation of a currency crisis model for Uganda," Frankfurt School - Working Paper Series 59, Frankfurt School of Finance and Management.
- repec:hal:wpaper:hal-00630711 is not listed on IDEAS
- Melisso Boschi & Luca Pieroni, 2008.
"Aluminium market and the macroeconomy,"
Quaderni del Dipartimento di Economia, Finanza e Statistica
42/2008, Università di Perugia, Dipartimento Economia, Finanza e Statistica.
- Rabah Arezki & Daniel Lederman & Hongyan Zhao, 2012.
"The Relative Volatility of Commodity Prices: A re-appraisal,"
OxCarre Working Papers
070, Oxford Centre for the Analysis of Resource Rich Economies, University of Oxford.
- Arezki, Rabah & Lederman, Daniel & Zhao, Hongyan, 2011. "The relative volatility of commodity prices : a reappraisal," Policy Research Working Paper Series 5903, The World Bank.
- Rabah Arezki & Daniel Lederman & Hongyan Zhao, 2011. "The Relative Volatility of Commodity Prices: A Reappraisal," IMF Working Papers 11/279, International Monetary Fund.
- Rabah Arezki & Daniel Lederman & Hongyan Zhao, 2011. "The Relative Volatility of Commodity Prices: A Reappraisal," CESifo Working Paper Series 3694, CESifo Group Munich.
- Lopez, Ramon E. & Stocking, Andrew, 2009. "Bringing Growth Theory "Down to Earth"," Working Papers 48944, University of Maryland, Department of Agricultural and Resource Economics.
- Fu, Xiaolan & Kaplinsky, Raphael & Zhang, Jing, 2012. "The Impact of China on Low and Middle Income Countries’ Export Prices in Industrial-Country Markets," World Development, Elsevier, vol. 40(8), pages 1483-1496.
- Mirzabaev, Alisher & Tsegai, Daniel W., 2012. "Effects of weather shocks on agricultural commodity prices in Central Asia," Discussion Papers 140769, University of Bonn, Center for Development Research (ZEF).
- Arango, Santiago & Moxnes, Erling, 2012. "Commodity cycles, a function of market complexity? Extending the cobweb experiment," Journal of Economic Behavior & Organization, Elsevier, vol. 84(1), pages 321-334.
- Norbert Funke & Weifeng Wu & Yanliang Miao, 2011. "Reviving the Competitive Storage Model: A Holistic Approach to Food Commodity Prices," IMF Working Papers 11/64, International Monetary Fund.
- Erten, Bilge & Ocampo, José Antonio, 2013. "Super Cycles of Commodity Prices Since the Mid-Nineteenth Century," World Development, Elsevier, vol. 44(C), pages 14-30.
- Matthias Basedau, 2005. "Context Matters – Rethinking the Resource Curse in Sub-Saharan Africa," Economic History 0508002, EconWPA.
- Arango, Santiago & Larsen, Erik, 2011. "Cycles in deregulated electricity markets: Empirical evidence from two decades," Energy Policy, Elsevier, vol. 39(5), pages 2457-2466, May.
- Cafiero, Carlo & Bobenrieth H., Eugenio S.A. & Bobenrieth H., Juan R.A. & Wright, Brian D., 2011. "The empirical relevance of the competitive storage model," Journal of Econometrics, Elsevier, vol. 162(1), pages 44-54, May.
- Matthias Basedau, 2005. "Context Matters – Rethinking the Resource Curse in Sub-Saharan Africa," GIGA Working Paper Series 01, GIGA German Institute of Global and Area Studies.
- repec:hal:cesptp:hal-00630711 is not listed on IDEAS
- Jann Lay & Toman Omar Mahmoud, 2004. "Bananas, Oil, and Development: Examining the Resource Curse and Its Transmission Channels by Resource Type," Kiel Working Papers 1218, Kiel Institute for the World Economy.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (David Long).
If references are entirely missing, you can add them using this form.