IDEAS home Printed from https://ideas.repec.org/p/uct/uconnp/1980-01.html
   My bibliography  Save this paper

A Stochastic Model of Optimum Commodity Buffer Stocks

Author

Listed:
  • Paul Hallwood

    (University of Connecticut)

Abstract

It has been established that in the case of linear supply and demand curves that are subjected to parallel stochastic shifts that the joint welfare of trading partners measured as the sum of consumers' and producers' surpluses is increased by a reduction in price instability. This paper, the precursor to a Quarterly Journal of Economics piece seeks to combine this result with information on the costs of buffer stock schemes to establish the optimum degree of price stabilization. The maximization of the trading partners' joint expected net benefits yields an optimum intervention price range and financial investment in commodity buffer stocks that will vary with demand and supply elasticities, and other market conditions.

Suggested Citation

  • Paul Hallwood, 1980. "A Stochastic Model of Optimum Commodity Buffer Stocks," Working papers 1980-01, University of Connecticut, Department of Economics.
  • Handle: RePEc:uct:uconnp:1980-01
    as

    Download full text from publisher

    File URL: http://web2.uconn.edu/economics/working/1980-01.pdf
    File Function: Full text
    Download Restriction: no

    More about this item

    Statistics

    Access and download statistics

    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:uct:uconnp:1980-01. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark McConnel). General contact details of provider: http://edirc.repec.org/data/deuctus.html .

    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.

    We have no references for this item. You can help adding them by using 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.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.