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Supply response of Zimbabwean agriculture: 1970–1999

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  • Muchapondwa, Edwin

Abstract

This paper uses data that spans different pricing regimes to estimate the aggregate agricultural supply response to price and non-price factors in Zimbabwe. The autoregressive distributed lag (ARDL) approach to cointegration employed here gives consistent estimates of supply response in the presence of regressor endogeneity and also permits the estimation of distinct estimates of both long-run and short-run elasticities when exogenous variables are not integrated of the same order. The results confirm that agricultural prices in Zimbabwe are endogenous and the exogenous variables are not integrated of the same order hence use of the autoregressive distributed lag approach was worthwhile. The paper finds a long-run price elasticity of 0.18, confirming findings in the literature that aggregate agricultural supply response to price is inelastic. This result means that the agricultural price policy is a somewhat blunt instrument for effecting growth in aggregate agricultural supply. The provision of non-price incentives must play a key role in reviving the agricultural sector in Zimbabwe.

Suggested Citation

  • Muchapondwa, Edwin, 2009. "Supply response of Zimbabwean agriculture: 1970–1999," African Journal of Agricultural and Resource Economics, African Association of Agricultural Economists, vol. 0(Number 1), pages 1-15, March.
  • Handle: RePEc:ags:afjare:56954
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    File URL: http://ageconsearch.umn.edu/record/56954/files/0301%20Muchapondwa%20-%20FINAL.pdf
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    Citations

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    Cited by:

    1. Magrini, Emiliano & Balié, Jean & Morales Opazo, Cristian, 2016. "Price signals and supply responses for staple food crops in SSA countries," DARE Discussion Papers 1601, Georg-August University of Göttingen, Department of Agricultural Economics and Rural Development (DARE).
    2. Bingxin Yu & Shenggen Fan, 2011. "Rice production response in Cambodia," Agricultural Economics, International Association of Agricultural Economists, vol. 42(3), pages 437-450, May.
    3. repec:taf:ragrxx:v:55:y:2016:i:3:p:237-253 is not listed on IDEAS
    4. Bachewe, Fantu Nisrane & Taffesse, Alemayehu Seyoum, 2015. "Dynamic supply response of farm households in Ethiopia:," ESSP working papers 78, International Food Policy Research Institute (IFPRI).
    5. Magrini, Emiliano & Morales-Opazo, Cristian & Balie, Jean, 2014. "Supply response along the value chain in selected SSA countries: the case of grains," 2014: Food, Resources and Conflict, December 7-9, 2014. San Diego, California 197193, International Agricultural Trade Research Consortium.

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    Keywords

    Farm Management;

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