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Application Of Mathematical Programming Models Simulating Competitive Market Equilibrium For Agricultural Policy And Planning Analysis

Author

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  • Kunkel, David E.
  • Gonzales, Leonardo A.
  • Hiwatig, Mario H.

Abstract

In this paper, recent theoretical advances of modeling are amplified and applied to a sample linear programming problem to demonstrate its usefulness for policy analysis. Policymakers and planners in agriculture are looking for analyses that will aid them in appraising what future levels of production may be expected at alternative price levels. This requires knowledge of what changes result from different supply-demand balances due to possible input scarcities, changes in productivity under alternative technologies and changes in consumer's preferences. The objectives of this paper are to (1) restate the theoretical underpinning that are useful for this analysis by specifying the complete model; (2) to demonstrate how the model can be solved using linear programming techniques; and, (3) demonstrate how the model can be used in policy analysis.

Suggested Citation

  • Kunkel, David E. & Gonzales, Leonardo A. & Hiwatig, Mario H., 1977. "Application Of Mathematical Programming Models Simulating Competitive Market Equilibrium For Agricultural Policy And Planning Analysis," 1977 Occasional Paper Series No. 1 190948, International Association of Agricultural Economists.
    • Handle: RePEc:ags:iaaeo1:190948
    DOI: 10.22004/ag.econ.190948
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    References listed on IDEAS

    as
    1. Alvin C. Egbert & Hyung M. Kim, 1975. "Analysis of Aggregation Errors in Linear Programming Planning Models," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 57(2), pages 292-301.
    2. Currie, John Martin & Murphy, John A & Schmitz, Andrew, 1971. "The Concept of Economic Surplus and its Use in Economic Analysis," Economic Journal, Royal Economic Society, vol. 81(324), pages 741-799, December.
    3. Earl O. Heady & Alvin C. Egbert, 1959. "Programming Regional Adjustments in Grain Production to Eliminate Surpluses," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 41(4), pages 718-733.
    4. Jose Encarnacion Jr., 1976. "On Predicting Subsectoral Outputs and Prices via an Optimizing Model," Philippine Review of Economics, University of the Philippines School of Economics and Philippine Economic Society, vol. 13(1), pages 89-92, June.
    5. Kunkel, David E., 1974. "A Programming Model of Philippine Agriculture," Miscellaneous Publications 334717, United States Department of Agriculture, Economic Research Service.
    6. T. Takayama & G. G. Judge, 1964. "An Interregional Activity Analysis Model for the Agricultural Sector," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 46(2), pages 349-365.
    7. Dan Yaron & Yakir Plessner & Earl O. Heady, 1965. "Competitive Equilibrium-Application Of Mathematical Programming," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 13(2), pages 65-79, July.
    8. Harberger, Arnold C, 1971. "Three Basic Postulates for Applied Welfare Economics: An Interpretive Essay," Journal of Economic Literature, American Economic Association, vol. 9(3), pages 785-797, September.
    9. Vernon L. Smith, 1963. "Minimization of Economic Rent in Spatial Price Equilibrium," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 30(1), pages 24-31.
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