Agricultural and macroeconomic behavior in Ethiopia's constrained economy: an econometric policy simulation study
Embargo Date
Indefinite
OA Version
Citation
Abstract
This study provides an integrated picture of the agricultural sector in Ethiopia and its interaction with other sectors of the economy. It has six chapters, of which, three form the substantive core. The other three constitute the introduction, the economic and institutional background and conclusion chapters. Among the core chapters, the first, Chapter III sets-up the farm-household decision problem in the Ethiopian rural setting and examines the comparative statics. The rural setting is characterized by rationing in the factor and product markets. Under such conditions, neo-classical assumptions and utility maximization yield supply response different from the conventional one. The comparative statics also examine the effect that changes in the price and the supply of manufactured goods to rural areas, and changes in the quantity of quota delivery to the government have on the supply response of agricultural output.
Chapter IV shifts the analysis from the household to the regional and then national agricultural markets. At this stage, new actors, including private grain merchants, are introduced. Now, the open market price for agricultural output becomes endogenous. Since the flow of agricultural goods is controlled, this causes price differential across regions. The latter factor in turn starts an interaction between markets. Here too, policy simulation has been undertaken to look at the effect on the open market price of various policy instruments. The chapter ends with an estimation of crop and aggregate supply response and sets the stage for the development of a small macroeconometric model.
In Chapter V the study aims at creating a link from the agricultural sector back to the non-agricultural sector which of course includes manufacturing operations. To make this true, the chapter introduces investment, foreign trade and the government sectors into the analysis and endogenizes the price of industrial goods. The model is essentially supply-driven with only two sectors. It has 14 behavioral equations and 39 identities. The results are then used, in Chaper VI, to assess the effect of a change in agricultural prices, foreign exchange adjustment and government resource mobilization on the growth of GDP, the BOP position and their components.
Description
Dissertation (Ph.D.)--Boston University
License
PLEASE NOTE: Boston University Libraries did not receive an Authorization To Manage form for this thesis or dissertation. It is therefore not openly accessible, though it may be available by request. If you are the author or principal advisor of this work and would like to request open access for it, please contact us at open-help@bu.edu. Thank you.