Total supply response of cereals in different states of India

Ram, G.S. (1973) Total supply response of cereals in different states of India. Agricultural Situation in India, 28 (7). pp. 467-471.

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The main objective is to understand the nature and magnitude of the price factor in influencing supply and to discover the impact of non-price factors on farmers' decisions on production. The hypothesis, concomitant to this objective, is that the farmers' response to total supply to change in price is very low, but always positive in the case of cereals. The reduced form of Nerlovian dynamic supply model was used to estimate the total supply response. The study was conducted for rice (Bihar, M.P., Tamil Nadu, West Bengal and all India), wheat (M.P., Punjab, Rajasthan) and jowar (Tamil Nadu). The data were gathered from various published and unpublished official documents. Multiple regression analysis was carried out. Both absolute and relative prices and yields were incorporated into the model. The acreage allocative decision of rice farmers in all the cases studied was influenced by the price of rice alone but not by its substitute crop(s). The area under wheat was determined by the relative price of wheat and grain throughout the country. Bajra and jowar acreage appeared to have been guided by different price relations in different states. In Punjab the relative price of bajra and paddy dictated the bajra acreage; in Rajasthan it was the relative price of bajra and maize for the same crop. Bajra competed with jowar in Tamil Nadu. It was found that the supply response in all cereal crops was very low, with none of them exceeding 0.4. In rice the response was the lowest (around 0.1), wheat ranged between 0.1 and 0.2. In the case of millets the response ranged between 0.2 and 0.4. The most striking characteristic of the empirical results was the positive price responsiveness of cereal growers throughout India

Item Type: Article
Author Affiliation: Indian Agricultural Research Institute, New Delhi, India
Subjects: Social Sciences > Marketing
Divisions: Maize
Depositing User: Ms K Syamalamba
Date Deposited: 28 Aug 2012 08:21
Last Modified: 28 Aug 2012 08:22

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