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Rationality, Price Risk, and Response

Author

Listed:
  • Seale, James L.
  • Shonkwiler, J. S.
Abstract
Risk has long been recognized as potentially important in determining agricultural supply. However, supply response models have either incorporated risk in an ad hoc manner or not at all. A rational expectations supply response model incorporating price risk is developed, an estimation procedure suggested, and an empirical example presented.

Suggested Citation

  • Seale, James L. & Shonkwiler, J. S., 1987. "Rationality, Price Risk, and Response," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 19(1), pages 111-118, July.
    • Handle: RePEc:cup:jagaec:v:19:y:1987:i:01:p:111-118_01
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    References listed on IDEAS

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    1. Goodwin, Thomas H & Sheffrin, Steven M, 1982. "Testing the Rational Expectations Hypothesis in an Agricultural Market," The Review of Economics and Statistics, MIT Press, vol. 64(4), pages 658-667, November.
    2. J. Scott Shonkwiler & Robert D. Emerson, 1982. "Imports and the Supply of Winter Tomatoes: An Application of Rational Expectations," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 64(4), pages 634-641.
    3. Batra, Raveendra N & Ullah, Aman, 1974. "Competitive Firm and the Theory of Input Demand under Price Uncertainty," Journal of Political Economy, University of Chicago Press, vol. 82(3), pages 537-548, May/June.
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    5. B. Wade Brorsen & Jean-Paul Chavas & Warren R. Grant & L. D. Schnake, 1985. "Marketing Margins and Price Uncertainty: The Case of the U.S. Wheat Market," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 67(3), pages 521-528.
    6. Eckstein, Zvi, 1984. "A Rational Expectations Model of Agricultural Supply," Journal of Political Economy, University of Chicago Press, vol. 92(1), pages 1-19, February.
    7. Sheffrin,Steven M., 1996. "Rational Expectations," Cambridge Books, Cambridge University Press, number 9780521474009, September.
    8. Frances Antonovitz & Terry Roe, 1984. "The Value of a Rational Expectations Forecast in a Risky Market: A Theoretical and Empirical Approach," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 66(5), pages 717-723.
    9. Kennan, John, 1979. "The Estimation of Partial Adjustment Models with Rational Expectations," Econometrica, Econometric Society, vol. 47(6), pages 1441-1455, November.
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    Cited by:

    1. Chembezi, Duncan M. & Womack, Abner W., 1992. "Regional Acreage Response For U.S. Corn And Wheat: The Effects Of Government Programs," Southern Journal of Agricultural Economics, Southern Agricultural Economics Association, vol. 24(1), pages 1-12, July.
    2. Burton, Diana M. & Love, H. Alan, 1996. "A Review of Alternative Expectations Regimes in Commodity Markets: Specification, Estimation, and Hypothesis Testing Using Structural Models," Agricultural and Resource Economics Review, Cambridge University Press, vol. 25(2), pages 213-231, October.
    3. Ghatak S. & Seale J., 2001. "Rice, Risk and Rationality: Supply Response in West Bengal, India," European Research Studies Journal, European Research Studies Journal, vol. 0(3-4), pages 155-155, July - De.
    4. David S. Bullock & Philip Garcia & Kie‐Yup Shin, 2005. "Measuring producer welfare under output price uncertainty and risk non‐neutrality," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 49(1), pages 1-21, March.
    5. Cho, Gyu D., 1992. "Estimation of a Wheat Acreage Response Function for Kansas," Staff Papers 118174, Kansas State University, Department of Agricultural Economics.
    6. Arnade, Carlos Anthony & Cooper, Joseph, 2013. "Price Expectations and Supply Response," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 150490, Agricultural and Applied Economics Association.
    7. Epperson, James E. & Huang, Wan-Tran, 1992. "The Potential For Intraseasonal Market Flow Management Of Southeastern Sweet Potatoes," Journal of Food Distribution Research, Food Distribution Research Society, vol. 23(2), pages 1-8, June.
    8. Epperson, James E. & Huang, Wan-Tran, 1994. "The Potential For Supply Management Of Southeastern Sweet Onions," Journal of Food Distribution Research, Food Distribution Research Society, vol. 25(2), pages 1-7, September.
    9. Mosadegh Sedghy, Bahareh & Tamini, Lota D. & Lambert, Remy, 2021. "Implications of the state assistance program in the province of Quebec: the case of lamb production," MPRA Paper 112162, University Library of Munich, Germany.

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