- Volume 43 Issue 1
Garlic and onion are staple agricultural products to Koreans and also are important with regard to agricultural producers' income. These products' acreage responses are highly correlated with each other. Therefore, it is necessary to test whether there is a cointegration relationship between garlic acreage and onion acreage when one tries to estimate the acreage response's function. Based upon the test result of cointegration, it is confirmed that there is no statistically significant cointegration relationship between garlic acreage and onion acreage. In this case, vector autoregressive model is preferred to vector error correction model. This study investigated the dynamic relationship between garlic and onion acreage responses using vector autoregressive (VAR) model. The estimated results of VAR acreage response models show that there is a statistically significant relationship between current and lagged acreage of more than one lag. Therefore, it is recommended that government should consider the long-run period's relationship of each product's acreage when it plans a policy for stabilizing the supply and demand of garlic and onion. For the price variables, garlic price only affects garlic acreage response while onion price affects not only onion acreage response but also garlic acreage response. This implies that the stabilizing policy for onion price could have bigger effects than that for garlic price stabilization.
acreage response;cointegration;garlic;onion;vector autoregressive model
- Kim MH, Kwon OB, Cho YS, Lee DS, Kim TH, Park SM. 2008. Korea agricultural simulation model. Korea Rural Economic Institute. [in Korean]
- Kim MH, Park JM, Park JK, Seo DS, Heo JO. 2000. Estimation of major vegetables and fruits' supply and demand functions. Korea Rural Economic Institute. [in Korean]
- Kim BS, Park MS, Cho JH, Kim TK. 2010. A demand and supply model of agricultural and livestock products for midterm outlook. Korea Rural Economic Institute. [in Korean]
- Hamilton JD. 1994. Time series analysis. p. 766. Princeton University Press, Princeton, NJ.
- Hill RC, Griffiths WE, Lim GC. 2011. Principles of economics (4th). pp. 474-504. John Wiley & Sons, Inc., Hoboken, NJ.
- Hong SJ, Kim SH, Lee EK. 2015. Estimating acreage response of red pepper by using error correction model. Korean Journal of Agricultural Management and Policy 42(3):507-522. [in Korean]
- Huq ASMA, Arshad FM. 2010. Supply response of potato in Bangladesh: A vector error correction approach. Journal of Applied Sciences. 10(11):895-902. https://doi.org/10.3923/jas.2010.895.902
- KOSIS (Korean Statistical Information Service). 2016. Agriculture, forest, and fishery. Assessed in http://kosis.kr/statisticsList on 6 January 2016.
- MAFRA (Ministry of Agriculture, Food and Rural Affairs). 2016. Agriculture, food and rural affairs statistics yearbook 2015. [in Korean]
- McKay A, Morrisey O, Vaillant C. 1998. Aggregate export and food crop supply response in Tanzanian. Credit Discussion Paper No. 4. DFID Trade and Enterprise Research Programme (TERP).
- RDA (Rural Development Administration). 2016. Agricultural management information system. Assessed in http://amis.rda.go.kr on 4 January 2016.
- Tsay RS. 2010. Analysis of financial time series (3rd). pp. 428-432. John Wiley & Sons, Inc., Hoboken, NJ.
Supported by : 충남대학교