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Spatial Equilibrium With Intermediate Products: Implementation And Validation In The Mercosur

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  • Waquil, Paulo Dabdab
  • Cox, Thomas L.

Abstract

This paper develops the formulation of a spatial equilibrium model with intermediate products. The presence of intermediate products brings a better representation of the real world, accounting for the technological relationships among commodities in the several stages of production. Instead of the usual assumption of constant costs of transformation, positively sloped cost of transformation functions are assumed, reflecting increasing marginal costs of transformation. The model is implemented and validated in the analysis of the optimal allocation and pricing of animal products, grains and oilseeds in the MERCOSUR.

Suggested Citation

  • Waquil, Paulo Dabdab & Cox, Thomas L., 1995. "Spatial Equilibrium With Intermediate Products: Implementation And Validation In The Mercosur," Staff Papers 12678, University of Wisconsin-Madison, Department of Agricultural and Applied Economics.
    • Handle: RePEc:ags:wisagr:12678
    DOI: 10.22004/ag.econ.12678
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    References listed on IDEAS

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    3. Gary Clyde Hufbauer & Jeffrey J. Schott, 1994. "Western Hemisphere Economic Integration," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 75, January.
    4. Chavas, Jean-Paul & Cox, Thomas L. & Jesse, Edward V., 1993. "Spatial Hedonic Pricing and Trade," Staff Papers 200574, University of Wisconsin-Madison, Department of Agricultural and Applied Economics.
    5. Bishop, Phillip M. & Pratt, James E. & Novakovic, Andrew M., 1993. "Analyzing the Impacts of the Proposed North American Free Trade Agreement on European-North American Dairy Trade Using a Joint-Input, Multi-Product Approach," Staff Papers 121341, Cornell University, Department of Applied Economics and Management.
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    Cited by:

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