Crowding out of private stocks by public stocks
Public stocks held by government have emerged as a food security issue as well as an issue in the Doha Round of World Trade Organization talks. Understanding the impact of public stocks requires understanding their crowding out effect on private stocks. A conceptual model of this crowding out effect...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
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Czech Academy of Agricultural Sciences
2019-11-01
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| Series: | Agricultural Economics (AGRICECON) |
| Subjects: | |
| Online Access: | https://agricecon.agriculturejournals.cz/artkey/age-201911-0004_crowding-out-of-private-stocks-by-public-stocks.php |
| _version_ | 1797899974392938496 |
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| author | Sanghyo Kim Carl Zulauf |
| author_facet | Sanghyo Kim Carl Zulauf |
| author_sort | Sanghyo Kim |
| collection | DOAJ |
| description | Public stocks held by government have emerged as a food security issue as well as an issue in the Doha Round of World Trade Organization talks. Understanding the impact of public stocks requires understanding their crowding out effect on private stocks. A conceptual model of this crowding out effect is developed. It utilises a call option associated with the release of public stocks. The model reveals that the crowding out effect on private stocks decreases as public stocks increase, in contrast to constant marginal crowding out reported by earlier studies. Crowding out of private stocks is also a function of the commodity's demand function, implying crowding out can vary by commodity. It is likely to be highest for commodities with the most inelastic demand. These commodities include wheat, rice, and other food staples often held as public stocks. Empirical analysis confirms these and other insights from the conceptual model. |
| first_indexed | 2024-04-10T08:38:35Z |
| format | Article |
| id | doaj.art-c05540cc380e4059b71a89f3df772bac |
| institution | Directory Open Access Journal |
| issn | 0139-570X 1805-9295 |
| language | English |
| last_indexed | 2024-04-10T08:38:35Z |
| publishDate | 2019-11-01 |
| publisher | Czech Academy of Agricultural Sciences |
| record_format | Article |
| series | Agricultural Economics (AGRICECON) |
| spelling | doaj.art-c05540cc380e4059b71a89f3df772bac2023-02-23T03:25:20ZengCzech Academy of Agricultural SciencesAgricultural Economics (AGRICECON)0139-570X1805-92952019-11-01651152052810.17221/34/2019-AGRICECONage-201911-0004Crowding out of private stocks by public stocksSanghyo Kim0Carl Zulauf1Center for Food and Marketing Research, Korea Rural Economic Institute, Naju, Republic of KoreaDepartment of Agricultural, Environmental and Development Economics, Ohio State University, Columbus, OH, USAPublic stocks held by government have emerged as a food security issue as well as an issue in the Doha Round of World Trade Organization talks. Understanding the impact of public stocks requires understanding their crowding out effect on private stocks. A conceptual model of this crowding out effect is developed. It utilises a call option associated with the release of public stocks. The model reveals that the crowding out effect on private stocks decreases as public stocks increase, in contrast to constant marginal crowding out reported by earlier studies. Crowding out of private stocks is also a function of the commodity's demand function, implying crowding out can vary by commodity. It is likely to be highest for commodities with the most inelastic demand. These commodities include wheat, rice, and other food staples often held as public stocks. Empirical analysis confirms these and other insights from the conceptual model.https://agricecon.agriculturejournals.cz/artkey/age-201911-0004_crowding-out-of-private-stocks-by-public-stocks.phpcorncrowding outprivate stockspublic stockssoybeansunited states (u.s.)wheat |
| spellingShingle | Sanghyo Kim Carl Zulauf Crowding out of private stocks by public stocks Agricultural Economics (AGRICECON) corn crowding out private stocks public stocks soybeans united states (u.s.) wheat |
| title | Crowding out of private stocks by public stocks |
| title_full | Crowding out of private stocks by public stocks |
| title_fullStr | Crowding out of private stocks by public stocks |
| title_full_unstemmed | Crowding out of private stocks by public stocks |
| title_short | Crowding out of private stocks by public stocks |
| title_sort | crowding out of private stocks by public stocks |
| topic | corn crowding out private stocks public stocks soybeans united states (u.s.) wheat |
| url | https://agricecon.agriculturejournals.cz/artkey/age-201911-0004_crowding-out-of-private-stocks-by-public-stocks.php |
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