Hostname: page-component-7479d7b7d-rvbq7 Total loading time: 0 Render date: 2024-07-09T16:26:00.296Z Has data issue: false hasContentIssue false
  • English
  • Français

An Application of the Rational Expectations Hypothesis in the U.S. Beekeeping Industry

Published online by Cambridge University Press:  10 May 2017

Lois Schertz Willett
Lois Schertz Willett*
Affiliation:
Department of Agricultural Economics, Cornell University
Get access

Abstract

A national beekeeping-industry model, assuming rational expectations, is presented.

Consistent and asymptotically efficient estimates are obtained by a modified two-step two-stage least squares method. Based on parameter estimates, elasticities, and likelihood functions, a previously estimated modified adaptive expectations model explains industry behavior better than the rational expectations model. Simulation analyses of the models suggest the direction of the impacts of an ineffective federal honey support program from 1982 through 1985 is similar but the magnitudes are varied. The rational expectations model indicates the decrease in beekeepers’ revenue in this period is larger than the decrease identified by the modified adaptive expectations model.

Type
Articles
Information
Northeastern Journal of Agricultural and Resource Economics , Volume 20 , Issue 2 , October 1991 , pp. 189 - 201
Copyright
Copyright © 1991 Northeastern Agricultural and Resource Economics Association 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

Footnotes

This research was partially funded by the Giannini Foundation of Agricultural Economics. The author appreciates helpful comments from Richard Boisvert, Ben French, Harry Kaiser, Steven Sheffrin, and two anonymous reviewers. The author is solely responsible for the views expressed here and for any remaining errors.

References

Antonovitz, F., and Green, R. “Alternative Estimates of Fed Beef Supply Response to Risk.” American Journal of Agricultural Economics 72 (1990):475–87.Google Scholar
Aradhyula, S. V., and Holt, M. T. “Risk Behavior and Rational Expectations in the U.S. Broiler Industry.” American Journal of Agricultural Economics 71 (1989):892–902.Google Scholar
Askari, H., and Cummings, J. T. “Estimating Agricultural Supply Response with the Nerlove Model: A Survey.” International Economics Review 18 (1977):257–92.Google Scholar
Atkinson, A. C. “A Method for Discriminating Between Models.” Journal of the Royal Statistical Society Series B. 32 (1970):323–53.Google Scholar
Cumby, R. E., Huizinga, J., and Obstfeld, M. “Two-Step Two-Stage Least Squares Estimation in Models with Rational Expectations.” Journal of Econometrics 21 (1983):333–35.Google Scholar
Fair, R. C., and Taylor, J. B. “Solution and Maximum Likelihood Estimation of Dynamic Nonlinear Rational Expectations Models.” Econometrica 51 (1983):1169–85.Google Scholar
Fisher, B. S. “Rational Expectations in Agricultural Economics Research and Policy Analysis.” American Journal of Agricultural Economics 64 (1982):260–65.Google Scholar
Goodwin, T. H., and Sheffrin, S. M. “Testing the Rational Expectations Hypothesis in an Agricultural Market.” Review of Economics and Statistics 64 (1982):658–67.Google Scholar
Hoff, F. L., and Phillips, J. K. Honey Background for 1990 Farm Legislation. CED Staff Rep. no. AGES 89–43. U.S. Department of Agriculture, Economic Research Service, Washington, DC, 1989.Google Scholar
Labys, W. C. Dynamic Commodity Models: Specification, Estimation and Simulation. Lexington, KY: D.C. Heath and Company, 1973.Google Scholar
Lipton, D., Poterba, J., Sachs, J., and Summers, L. “Multiple Shooting in Rational Expectations Models.” Econometrica 50 (1982):1329–33.Google Scholar
McCallum, B. T. “Rational Expectations and the Natural Rate Hypothesis: Some Consistent Estimates.” Econometrica 44 (1976):43–52.Google Scholar
Muth, J. F. “Rational Expectations and the Theory of Price Movements.” Econometrica 29 (1961):315–35.Google Scholar
Nerlove, M. The Dynamics of Supply: Estimation of Farmer's Response to Price. Baltimore: John Hopkins Press, 1958.Google Scholar
Newey, W. K., and West, K. D. A Simple, Positive Semi-Definite, Heteroskedasticity and Autocorrelation Consistent Covariance Matrix. Technical Working Paper no. 55. National Bureau of Economic Research, Cambridge, April 1986.Google Scholar
Pesaran, M. H. “On the General Problem of Model Selection.” Review of Economic Studies 41 (1974):153–71.Google Scholar
Pesaran, M. H., and Deaton, A. S. “Testing Non-Nested Nonlinear Regression Models.” Econometrica 46 (1978):677–94.Google Scholar
Shideed, K. H., and White, F. C. “Alternative Forms of Price Expectations in Supply Analysis for U.S. Corn and Soybean Acreage.” Western Journal of Agricultural Economics 14 (1989):281–92.Google Scholar
Shideed, K. H., Brannen, S. J., and Glover, R. S. Econometric Estimation of Soybean Supply Response under the Rational-Expectations Hypothesis. Research Bulletin 352. Georgia Agricultural Experiment Stations, University of Georgia, Athens, December 1986.Google Scholar
Shonkwiler, J. S. “An Empirical Comparison of Agricultural Supply Response Mechanisms.” Applied Economics 14 (1982):183–94.Google Scholar
Shonkwiler, J. S., and Emerson, R. D. “Imports and the Supply of Winter Tomatoes: An Application of Rational Expectations.” American Journal of Agricultural Economics 64 (1982):634–41.Google Scholar
Tegene, A., Huffman, W. E., and Miranowski, J. A. “Dynamic Corn Supply Functions: A Model with Explicit Optimization.” American Journal of Agricultural Economics 70 (1988):103–11.Google Scholar
Wallis, K. F. “Econometric Implications of the Rational Expectations Hypothesis.” Econometrica 48 (1980):49–73.Google Scholar
Willett, L. S, and French, B. C. “An Econometric Model of the U.S. Beekeeping Industry.” American Journal of Agricultural Economics 73 (1991):40–54.Google Scholar
Zanias, G. P. “Adjustment Costs and Rational Expectations: An Application to a Tobacco Export Model.” American Journal of Agricultural Economics 69 (1987):22–29.Google Scholar