Effects of Cooking Oil Subsidy Removals on Related Markets in Malaysia: A Comparative Static, Multicommodity, Multi Stage Production Approach
Malaysia is contemplating removal of most of her subsidy support measures including subsidies on cooking oil which is largely palm oil based. This paper aims to examine the effects of cooking oil subsidy removals on the competitiveness of the oil palm subsector and related markets. This is done by d...
| Main Authors: | , |
|---|---|
| Format: | Article |
| Language: | English |
| Published: |
UUM Press
2011-12-01
|
| Series: | International Journal of Management Studies |
| Subjects: | |
| Online Access: | https://e-journal.uum.edu.my/index.php/ijms/article/view/10351 |
| _version_ | 1828054280740798464 |
|---|---|
| author | Jamal Othman Yaghoob Jafari |
| author_facet | Jamal Othman Yaghoob Jafari |
| author_sort | Jamal Othman |
| collection | DOAJ |
| description | Malaysia is contemplating removal of most of her subsidy support measures including subsidies on cooking oil which is largely palm oil based. This paper aims to examine the effects of cooking oil subsidy removals on the competitiveness of the oil palm subsector and related markets. This is done by developing and applying a comparative static, multi-commodity, partial equilibrium model with multi-stages of production function for the Malaysian perennial crops subsector which explicitly links different stages of production, primary and intermediate input markets, trade, and policy linkages. Results partly suggest that export of cooking oil will increase by 0.2 per cent due to a 10 per cent cooking oil subsidy reduction, while domestic output of cooking oil may eventually see a net decline of 1.97 per cent. The results clearly point out that the effect of reducing cooking oil subsidies is relatively small at the upstream levels and therefore it only induces minute effects on factor markets. Consequently, the market for other agricultural crops is projected to change very marginally.
Keywords: Multicomodity, comparative statics, partial equilibrium model, output supply-factor markets linkages, effects of cooking oil subsidy removals. |
| first_indexed | 2024-04-10T20:20:15Z |
| format | Article |
| id | doaj.art-bebd26093a2043ada0750fa0b8ca2d02 |
| institution | Directory Open Access Journal |
| issn | 2232-1608 2180-2467 |
| language | English |
| last_indexed | 2024-04-10T20:20:15Z |
| publishDate | 2011-12-01 |
| publisher | UUM Press |
| record_format | Article |
| series | International Journal of Management Studies |
| spelling | doaj.art-bebd26093a2043ada0750fa0b8ca2d022023-01-26T03:12:45ZengUUM PressInternational Journal of Management Studies2232-16082180-24672011-12-01182Effects of Cooking Oil Subsidy Removals on Related Markets in Malaysia: A Comparative Static, Multicommodity, Multi Stage Production ApproachJamal Othman0Yaghoob Jafari1Faculty of Economics and Management Universiti Kebangsaan MalaysiaFaculty of Economics and Management Universiti Kebangsaan MalaysiaMalaysia is contemplating removal of most of her subsidy support measures including subsidies on cooking oil which is largely palm oil based. This paper aims to examine the effects of cooking oil subsidy removals on the competitiveness of the oil palm subsector and related markets. This is done by developing and applying a comparative static, multi-commodity, partial equilibrium model with multi-stages of production function for the Malaysian perennial crops subsector which explicitly links different stages of production, primary and intermediate input markets, trade, and policy linkages. Results partly suggest that export of cooking oil will increase by 0.2 per cent due to a 10 per cent cooking oil subsidy reduction, while domestic output of cooking oil may eventually see a net decline of 1.97 per cent. The results clearly point out that the effect of reducing cooking oil subsidies is relatively small at the upstream levels and therefore it only induces minute effects on factor markets. Consequently, the market for other agricultural crops is projected to change very marginally. Keywords: Multicomodity, comparative statics, partial equilibrium model, output supply-factor markets linkages, effects of cooking oil subsidy removals.https://e-journal.uum.edu.my/index.php/ijms/article/view/10351Multicomoditycomparative staticspartial equilibrium modeloutput supply-factor markets linkageseffects of cooking oil subsidy removals |
| spellingShingle | Jamal Othman Yaghoob Jafari Effects of Cooking Oil Subsidy Removals on Related Markets in Malaysia: A Comparative Static, Multicommodity, Multi Stage Production Approach International Journal of Management Studies Multicomodity comparative statics partial equilibrium model output supply-factor markets linkages effects of cooking oil subsidy removals |
| title | Effects of Cooking Oil Subsidy Removals on Related Markets in Malaysia: A Comparative Static, Multicommodity, Multi Stage Production Approach |
| title_full | Effects of Cooking Oil Subsidy Removals on Related Markets in Malaysia: A Comparative Static, Multicommodity, Multi Stage Production Approach |
| title_fullStr | Effects of Cooking Oil Subsidy Removals on Related Markets in Malaysia: A Comparative Static, Multicommodity, Multi Stage Production Approach |
| title_full_unstemmed | Effects of Cooking Oil Subsidy Removals on Related Markets in Malaysia: A Comparative Static, Multicommodity, Multi Stage Production Approach |
| title_short | Effects of Cooking Oil Subsidy Removals on Related Markets in Malaysia: A Comparative Static, Multicommodity, Multi Stage Production Approach |
| title_sort | effects of cooking oil subsidy removals on related markets in malaysia a comparative static multicommodity multi stage production approach |
| topic | Multicomodity comparative statics partial equilibrium model output supply-factor markets linkages effects of cooking oil subsidy removals |
| url | https://e-journal.uum.edu.my/index.php/ijms/article/view/10351 |
| work_keys_str_mv | AT jamalothman effectsofcookingoilsubsidyremovalsonrelatedmarketsinmalaysiaacomparativestaticmulticommoditymultistageproductionapproach AT yaghoobjafari effectsofcookingoilsubsidyremovalsonrelatedmarketsinmalaysiaacomparativestaticmulticommoditymultistageproductionapproach |