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A MODEL OF SUPPLY RESPONSE IN THE AUSTRALIAN ORANGE GROWING INDUSTRY *
Author(s) -
Alston Julian M.,
Freebairn John W.,
Quilkey John J.
Publication year - 1980
Publication title -
australian journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.683
H-Index - 49
eISSN - 1467-8489
pISSN - 0004-9395
DOI - 10.1111/j.1467-8489.1980.tb00581.x
Subject(s) - profitability index , orange (colour) , production model , production (economics) , economics , agricultural economics , econometrics , horticulture , microeconomics , biology , finance
A model of the Australian orange growing industry to explain changes in plantings, removals, the number and age composition of trees and orange production is developed and estimated. Most of the variation in plantings is explained by the expected profitability of growing oranges, the current stocks of bearing and nonbearing trees, and removals of trees last year. Estimates of the elasticities of response of plantings and production to price changes are low and there are long time lags. An illustrative application of the model projects future developments in the industry for alternative assumptions about the profitability of growing oranges.