Supply Response Analysis of Rice Growers in District Gujranwala, Pakistan

Sunair Junaid¹, Arif Ullah², Shaofeng Zheng², Syed Noor Muhammad Shah^3,4*, Shahid Ali¹, Munir Khan¹

¹Department of Agricultural and Applied Economics, The University of Agriculture, Peshawar, Pakistan.
²College of Economics and Management, Northwest A & F University, Yangling, China.
³Department of Horticulture, Faculty of Agriculture, Gomal University, D. I. Khan, Pakistan.
⁴College of Horticulture, Northwest A & F University, Yangling, China.

DOI: 10.4236/as.2014.511116                

Abstract

The study was designed to estimate the restricted profit function in district Gujranwala, Punjab, Pakistan. Data were collected from 100 respondents using proportional allocation sampling tech-nique. The analysis was done using SHAZAM software. The results indicate that the farmers are price-responsive. Rice own price elasticity was 1.873. The output supply elasticity of rice with re-spect to education, land, fertilizer price and irrigation cost were 0.0.169, 1.274, -0.873 and -0.953 respectively. Irrigation demand elasticity with respect to education, land, fertilizer price, irrigation cost and output price were 0.14, 1.14, -0.783, -1.84 and 1.78 respectively. Fertilizer demand elasticity with respect to education, land, fertilizer price, irrigation cost and output price was 0.023, 0.792, -1.65, -0.85 and 1.851 respectively. Lastly, the elasticity of profit with respect to education, land, fertilizer price, irrigation cost and output price was 0.20, 1.10, -0.83, -1.136 and 1.92 respectively. The study recommends that Government should provide consistent electricity with stable rates, so that, they irrigate their fields through electric tube wells and ultimately their cost of irrigation decreases. The study also suggests that government should stabilized fertilizer prices to encourage its application. Furthermore, government should raise procurement price of rice to encourage its supply this; it in turn will also increase the profit of the farmer.

Keywords

Rice, Supply Response, Translog Restricted Profit

Conflicts of Interest

The authors declare no conflicts of interest.

References

[1]	Farooq, O. (2013) Agriculture. Ministry of Finance, Government of Pakistan, Islamabad.
[2]	FAO (2013) Food and Agriculture Organization. Cereal Crop Statistics. http://www.fao.org/tc/tci/newsandmeetings/en/s
[3]	Anonymous (2014) Basmati Rice. http://www.pakissan.com/english/allabout/crop/rice/
[4]	Shaikh, F.M. and Shah, M.A. (2008) Dynamic Supply Response Analysis of Pakistani Rice Growers. Pakistan Journal of Commerce and Social Sciences, 1, 48-55.
[5]	Chaudhary, M.A., Khan, M.A. and Naqvi, K.H. (1998) Estimates of Farm Output Supply and Input Demand Elasticities: The Translog Profit Function Approach. The Pakistan Development Review, 37, 1031-1050.
[6]	Griffith, G., I’Anson, K., Hill, D. and Lubett, R. (2001) Previous Supply Elasticity Estimates for Australian Broadacre Agriculture.
[7]	Sidhu, S.S. and Baanante, C.A. (1981) Estimating Farm-Level Input Demand and Wheat Supply in the Indian Punjab Using a Translog Profit Function. American Journal of Agricultural Economics, 63, 237-246. http://dx.doi.org/10.2307/1239559
[8]	Thakare, S.S., Shende, N.V. and Shinde, K.J. (2012) Mathematical Modeling for Demand and Supply Estimation for Cotton in Maharashtra. International Journal of Scientific and Research Publications, 2, 1-5.
[9]	Farooq, U., Young, T., Russell, N. and Iqbal, M. (2001) The Supply Response of Basmati Rice Growers in Punjab, Pakistan: Price and Non-Price Determinants. Journal of International Development, 13, 227-237. http://dx.doi.org/10.1002/jid.728
[10]	Diewert, W.E. (1974) () Applications of Duality Theory. In: Intrlligator, M.D. and Kendrick, D.A., Eds., Frontiers of Qumtitatiue Economics, Stanford Institute for Mathematical Studies in the Social Sciences, North-Holland Publishing Company, Amsterdam.
[11]	Christensen, L.R., Jorgenson, D.W. and Lau, L.J. (1973) Transcendental Logarithmic Production Frontiers. The Review of Economics and Statistics, 55, 28-45. http://dx.doi.org/10.2307/1927992
[12]	Gujarati, D.N. (2012) Basic Econometrics. Tata McGraw-Hill Education, Noida.
[13]	Rahman, S. (2003) Profit Efficiency among Bangladeshi Rice Farmers. Food Policy, 28, 487-503. http://dx.doi.org/10.1016/j.foodpol.2003.10.001
[14]	Ullah, R., Ali, S., Safi, Q.S., Shah, J. and Khan, K.H. (2012) Supply Response Analysis of Wheat Growers in District Peshawar: Pakistan. International Journal of Latest Trends in Agriculture and Food Sciences, 2, 33-38.