IDEAS home Printed from https://ideas.repec.org/p/ags/aaea84/278895.html
   My bibliography  Save this paper

The Use of Expectations In Agricultural Supply Response

Author

Listed:
  • Hazard, Suzanne
  • Shonkwiler, J. Scott

Abstract

A composite supply response model is formulated that has extrapolative and rational components as well as a partial adjustment mechanism. The model is applied to the Florida Watermelon Market to investigate how producers are forming their expectation of watermelon prices at harvest time. The results show that a dynamic cobweb mechanism is a valid representation of the data and suggests that producers are not using all the relevant information in the market.

Suggested Citation

  • Hazard, Suzanne & Shonkwiler, J. Scott, 1984. "The Use of Expectations In Agricultural Supply Response," 1984 Annual Meeting, August 5-8, Ithaca, New York 278895, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    • Handle: RePEc:ags:aaea84:278895
    DOI: 10.22004/ag.econ.278895
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/278895/files/aaea-1984-006.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.278895?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Pesaran, M. H., 1981. "Identification of rational expectations models," Journal of Econometrics, Elsevier, vol. 16(3), pages 375-398, August.
    2. Bruce L. Gardner, 1976. "Futures Prices in Supply Analysis," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 58(1), pages 81-84.
    3. Marc Nerlove, 1958. "Adaptive Expectations and Cobweb Phenomena," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 72(2), pages 227-240.
    4. Goodwin, Thomas H & Sheffrin, Steven M, 1982. "Testing the Rational Expectations Hypothesis in an Agricultural Market," The Review of Economics and Statistics, MIT Press, vol. 64(4), pages 658-667, November.
    5. J. Scott Shonkwiler & Robert D. Emerson, 1982. "Imports and the Supply of Winter Tomatoes: An Application of Rational Expectations," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 64(4), pages 634-641.
    6. Wallis, Kenneth F, 1980. "Econometric Implications of the Rational Expectations Hypothesis," Econometrica, Econometric Society, vol. 48(1), pages 49-73, January.
    7. Feige, Edgar L & Pearce, Douglas K, 1976. "Economically Rational Expectations: Are Innovations in the Rate of Inflation Independent of Innovations in Measures of Monetary and Fiscal Policy?," Journal of Political Economy, University of Chicago Press, vol. 84(3), pages 499-522, June.
    8. Sheffrin,Steven M., 1996. "Rational Expectations," Cambridge Books, Cambridge University Press, number 9780521474009.
    9. Sanford J. Grossman, 1977. "The Existence of Futures Markets, Noisy Rational Expectations and Informational Externalities," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 44(3), pages 431-449.
    10. Raymond M. Leuthold & Peter A. Hartmann, 1979. "A Semi-Strong Form Evaluation of the Efficiency of the Hog Futures Market," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 61(3), pages 482-489.
    11. Just, Richard E, 1977. "Estimation of an Adaptive Expectations Model," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 18(3), pages 629-644, October.
    12. Doran, H. E. & Griffiths, W. E., 1978. "Inconsistency of the OLS estimator of the partial adjustment-adaptive expectations model," Journal of Econometrics, Elsevier, vol. 7(2), pages 133-146, June.
    13. Pashigian, B Peter, 1970. "Rational Expectations and the Cobweb Theory," Journal of Political Economy, University of Chicago Press, vol. 78(2), pages 338-352, March-Apr.
    14. Daniel B. Suits, 1955. "An Econometric Model of the Watermelon Market," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 37(2), pages 237-251.
    15. Balestra, Pietro, 1980. "A note on the exact transformation associated with the first-order moving average process," Journal of Econometrics, Elsevier, vol. 14(3), pages 381-394, December.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Shonkwiler, John Scott & Hinckley, Suzanne, 1985. "A Generalized Supply Response/Factor Demand Model And Its Application To The Feeder Cattle Market," Western Journal of Agricultural Economics, Western Agricultural Economics Association, vol. 10(2), pages 1-9, December.
    2. Tsai, Grace Yueh-Hsiang, 1989. "A dynamic model of the U.S. cotton market with rational expectations," ISU General Staff Papers 1989010108000012168, Iowa State University, Department of Economics.
    3. Burton, Diana M. & Love, H. Alan, 1996. "A Review of Alternative Expectations Regimes in Commodity Markets: Specification, Estimation, and Hypothesis Testing Using Structural Models," Agricultural and Resource Economics Review, Cambridge University Press, vol. 25(2), pages 213-231, October.
    4. McNulty, Mark S., 1985. "Information usage in the formation of price expectations: theory and econometric tests," ISU General Staff Papers 1985010108000013085, Iowa State University, Department of Economics.
    5. Seale, James L. & Shonkwiler, J. S., 1987. "Rationality, Price Risk, and Response," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 19(1), pages 111-118, July.
    6. Chembezi, Duncan M. & Cacho, Joyce A., 1997. "Alternative Price Expectation Formulation and Information Access," 1997 Annual Meeting, July 13-16, 1997, Reno\ Sparks, Nevada 35905, Western Agricultural Economics Association.
    7. Skold, Karl Durwood, 1989. "The integration of alternative information systems: an application to the Hogs and Pigs report," ISU General Staff Papers 1989010108000010239, Iowa State University, Department of Economics.
    8. Miranda, Mario J & Glauber, Joseph W, 1993. "Estimation of Dynamic Nonlinear Rational Expectations Models of Primary Commodity Markets with Private and Government Stockholding," The Review of Economics and Statistics, MIT Press, vol. 75(3), pages 463-470, August.
    9. Ghatak S. & Seale J., 2001. "Rice, Risk and Rationality: Supply Response in West Bengal, India," European Research Studies Journal, European Research Studies Journal, vol. 0(3-4), pages 155-155, July - De.
    10. Nerlove, Marc & Fornari, Ilaria, 1998. "Quasi-rational expectations, an alternative to fully rational expectations: An application to US beef cattle supply," Journal of Econometrics, Elsevier, vol. 83(1-2), pages 129-161.
    11. Moore, Kevin Clare, 1985. "Predictive econometric modeling of the United States farmland market: an empirical test of the rational expectations hypothesis," ISU General Staff Papers 198501010800008872, Iowa State University, Department of Economics.
    12. Shonkwiler, J. Scott & Spreen, Thomas H., 1980. "The Rational Expectations Hypothesis: An Empirical Application To The Florida Escarole Market," 1980 Annual Meeting, July 27-30, Urbana-Champaign, Illinois 278478, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    13. Chaudhry, Muhammad Imran & Katchova, Ani & Miranda, Mario Javier, 2016. "Examining pricing mechanics in the poultry value chain - empirical evidence from Pakistan," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 235953, Agricultural and Applied Economics Association.
    14. Driskill, Robert A. & Sheffrin, Steven M., 1982. "Some Evidence In Favor Of A Monetary Model Of Exchange Rate Determination," 1982 Annual Meeting, August 1-4, Logan, Utah 279142, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    15. Fisher, Brian S., 1983. "Rational Expectations In The Australian Wool Industry," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 27(3), pages 1-9, December.
    16. Gary Koop & M. Hashem Pesaran & Ron P. Smith, 2013. "On Identification of Bayesian DSGE Models," Journal of Business & Economic Statistics, Taylor & Francis Journals, vol. 31(3), pages 300-314, July.
    17. Kastens, Terry L. & Schroeder, Ted C., 1994. "Cattle Feeder Behavior And Feeder Cattle Placements," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 19(2), pages 1-12, December.
    18. Epperson, James E. & Huang, Wan-Tran, 1992. "The Potential For Intraseasonal Market Flow Management Of Southeastern Sweet Potatoes," Journal of Food Distribution Research, Food Distribution Research Society, vol. 23(2), pages 1-8, June.
    19. Sanders, Dwight R. & Garcia, Philip & Manfredo, Mark R., 2008. "Information Content in Deferred Futures Prices: Live Cattle and Hogs," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 33(1), pages 1-12, April.
    20. Broze, Laurence & Gourieroux Christian & Szafarz A, 1986. "Reduction and identification of simultaneous equations models with rational expectations," CEPREMAP Working Papers (Couverture Orange) 8601, CEPREMAP.

    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:ags:aaea84:278895. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: AgEcon Search (email available below). General contact details of provider: http://www.aaea.org .

    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.