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MODELLING FERTILISER DEMAND IN THE REPUBLIC OF IRELAND: A COST FUNCTION APPROACH
Author(s) -
Boyle G.
Publication year - 1982
Publication title -
journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.157
H-Index - 61
eISSN - 1477-9552
pISSN - 0021-857X
DOI - 10.1111/j.1477-9552.1982.tb00723.x
Subject(s) - corollary , economics , econometrics , elasticity of substitution , substitution (logic) , nutrient , elasticity (physics) , value (mathematics) , function (biology) , agricultural economics , mathematics , microeconomics , phosphorus , price elasticity of demand , demand curve , seemingly unrelated regressions , production (economics) , statistics , chemistry , thermodynamics , computer science , combinatorics , physics , organic chemistry , evolutionary biology , biology , programming language
A translog cost function was used to obtain estimates of the own‐ and cross‐price demand elasticities for nitrogen, phosphorus and potassium. The results indicated a mean value for the own‐elasticities of —1.0, —0.6, —0.5 for N, P and K respectively. A test of the hypothesis of nutrient substitution was attempted. The test indicated that P and K were substitutable for N but not for each other. This result was corroborated by a zero elasticity of substitution estimate between phosphorous and potassium. A corollary of the results was the rejection on empirical grounds of the Cobb‐Douglas specification for the input demand functions. The latter function has traditionally been used in analyses of this nature.