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Supply response to changes in agricultural commodity prices in Asian countries

Author

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  • Imai, Katsushi S.
  • Gaiha, Raghav
  • Thapa, Ganesh

Abstract

The objective of the present study is to examine the extent to which the production of different agricultural commodities, namely, maize, wheat, rice, fruit, vegetable, and oilseeds, responds to price changes in selected Asian countries given the recent high and volatile agricultural prices. Our analysis confirms a strong positive yield response to higher prices in a panel of 10 Asian countries. However, there is considerable variation in the strength and speed of yield responses of these different commodities. We found that the yield response in the current period is strongest for oilseeds. The price of oil has a negative effect on yields of most of the commodities. For wheat, rice, vegetable, and oilseeds, the yield responses weakened after 2000. From a policy perspective, our analysis points to the potential of price policy in inducing a large supply of foodgrains given the high output elasticity of marketed supply.

Suggested Citation

  • Imai, Katsushi S. & Gaiha, Raghav & Thapa, Ganesh, 2011. "Supply response to changes in agricultural commodity prices in Asian countries," Journal of Asian Economics, Elsevier, vol. 22(1), pages 61-75, February.
  • Handle: RePEc:eee:asieco:v:22:y:2011:i:1:p:61-75
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    Cited by:

    1. 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.
    2. repec:eee:asieco:v:52:y:2017:i:c:p:32-44 is not listed on IDEAS
    3. Bingxin Yu & Shenggen Fan, 2011. "Rice production response in Cambodia," Agricultural Economics, International Association of Agricultural Economists, vol. 42(3), pages 437-450, May.
    4. Simrit Kaur, 2014. "Food entitlements, subsidies and right to food: a South Asian perspective," Chapters,in: Handbook on Food, chapter 19, pages 482-514 Edward Elgar Publishing.
    5. Poulomi BHATTACHARYA & Badri Narayan RATH & Aruna Kumar DASH, 2016. "Supply Response of Milk Production: Analysis and Implications for BRIC Countries," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 16(1).
    6. Thapa, Ganesh & Gaiha, Raghav Gaiha, 2012. "Food Security in Asia and the Pacific: The Role of Smallholders," Asian Journal of Agriculture and Development, Southeast Asian Regional Center for Graduate Study and Research in Agriculture (SEARCA), vol. 0(Number 1), pages 1-37, June.
    7. Mat Rahim, Siti Rohaya, 2014. "Asymmetric Cointegration: Barley and Crude Oil Price in United States," MPRA Paper 58447, University Library of Munich, Germany.
    8. Katsushi Imai & Raghav Gaiha & Ganesh Thapa & Abdilahi Ali, 2011. "Re-examination of supply response to changes in food commodity prices in Asian countries," The School of Economics Discussion Paper Series 1113, Economics, The University of Manchester.

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