Price and quantity controlled agricultural markets and disequilibrium econometrics: a survey

This survey reviews the literature on estimating single markets in disequilibrium in the presence of regulated price and/or quantity controls, e.g., minimum price regimes and/or marketing quotas. Most of the literature is found to describe pure econometric technique, with only a few applications having emerged to date. Various reasons for the broad non‐acceptance of this literature are offered, including a perceived lack of realism. Proposals to close this econometric theory–application gap are put forward, including: the use of effective demand concepts in specifying demand and supply functions; synthesizing some closely related literature on agricultural price/quantity controls with disequilibrium econometrics (i.e., endogenous government policy and the effects controls have on yield uncertainty and price risk); and outlining more ‘applicable’ econometric technique extensions.