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Empirical investigation of investment behaviour in Australia's pastoral region

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  • Frank W. Agbola
  • Stephen R. Harrison

Abstract

Optimal intertemporal investment behaviour of Australian pastoralists is modelled using panel data for the period 1979-1993. Results indicate that quasi-fixity of inputs of labour, capital, sheep numbers and cattle numbers is characteristic of production in the pastoral region. It takes about two years for labour, four years for capital and a little over two years for both sheep numbers and cattle numbers to adjust towards long-run optimal levels. Results also indicate that, after accounting for adjustment costs, own-price product supply and input demand responses are inelastic in both the short and long run. Copyright 2005 Australian Agricultural and Resource Economics Society Inc. and Blackwell Publishing Asia Pty Ltd..

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  • Frank W. Agbola & Stephen R. Harrison, 2005. "Empirical investigation of investment behaviour in Australia's pastoral region ," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 49(1), pages 47-62, March.
  • Handle: RePEc:bla:ajarec:v:49:y:2005:i:1:p:47-62
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    References listed on IDEAS

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    Cited by:

    1. Sansi Yang & C. Richard Shumway, 2014. "Dynamic Adjustment in U.S. Agriculture under Climate Uncertainty," 2014 Papers pya413, Job Market Papers.
    2. Kopke, Emma & Kingwell, Ross S. & Young, John, 2005. "A farm-level economic assessment of the Australian Merino, Dohne Merino, and South African Meat Merino sheep breeds in southern Australia," 2005 Conference (49th), February 9-11, 2005, Coff's Harbour, Australia 137934, Australian Agricultural and Resource Economics Society.

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