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SUPPLY RESPONSE WITH STOCHASTIC TECHNOLOGY AND PRICES IN AUSTRALIA'S RURAL EXPORT INDUSTRIES
Author(s) -
Easter Christopher D.,
Paris Quirino
Publication year - 1983
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.1467-8489.1983.tb00420.x
Subject(s) - production (economics) , revenue , agricultural economics , agriculture , economics , business , microeconomics , finance , ecology , biology
Risky output prices and production characterise Australian agriculture. Exports are vitally important, sometimes relying heavily on a particular market. In this study a model is developed to include explicitly both output price and technological risks as well as multiple output relationships. It is used to show that changes in US beef import policy generating a 10 per cent beef price fall could reduce Australian beef supply by 3.5 per cent and grazing industry net revenue by 8.4 per cent, despite some switching from beef production to other enterprises.