Demand, Supply, and Price Relationships for the Dairy Sector, Post-World War II Period

Abstract

A simultaneous equation dairy model allowing for possible simultaneity between supplies and demands is formulated and estimated. The findings, which are comparable with those of earlier studies, indicate that the supply of milk is largely predetermined with respect to the price of milk in year t and is more elastic, but still inelastic, with respect to the average price of milk in years t − 1, t − 2, and t − 3. They further indicate that the demand for fluid milk products as well as the demand for manfactured dairy products is inelastic with respect to price and income. © 1967, Oxford University Press.