A vector autoregressive approach to estimate cassava supply response
Keywords:
vector autoregressive model, impulse response, variance decomposition, cassava output supplyAbstract
Cassava production is an important part of Colombia´s economy as it is a source of income and food supply for small-scale farmers and their families. Therefore, the aim of the present study was to estimate the cassava output supply response to own-price and production using time series data from 1996-2016. A quantitative, correlational and non-experimental research design was selected and the vector autoregressive framework was employed. The impulse-response function and the decomposition variance were also used to verify the impact of price transmission and the interaction between variables. The empirical results showed that the signs and the magnitude of the coefficients were statistically significant and that own-price elasticity was above the unit (1.88). In addition, the impulse response and the variance decomposition analysis suggests that price plays an important role in the variability of cassava supply response. Therefore, the proposed model contributes to the understanding of the dynamics in cassava output supply.
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