Introduction

Abstract

The focus of the book is on the various market interrelationships, both horizontally and vertically, among commodities. Many problems exist in moving from theoretical to empirics and the present book intends to bridge this gap. Going from theory to applications requires we have appropriate data—time series, cross section, panel—that match the appropriate theoretical counterparts. Often the data fail to match the theory so methods need to be developed to correct these problems. Through actual empirical applications of the models presented, methods for dealing with practical problems encountered in applied demand analysis are presented and discussed. The book is organized in ten chapters. Chapters 2–5 deal with the theory of consumer demand and systems of demand functions. Chapter 6 focuses on issues encountered with cross section and panel data. Chapters 7 and 8 focus on retail-to-farm price and demand linkages between retail demand and raw material demand for commodities. Both long-run and short-run models of price behavior are presented and discussed for competitive and imperfectly competitive markets. Chapters 9 and 10 present dynamic models of consumer and producer behavior, respectively.