Determinants of corn acreage response model underprice policy program
Department of Agribusiness, Faculty of Agriculture, University of Jambi, Indonesia.
Research Article
International Journal of Scientific Research Updates, 2024, 08(02), 157–163.
Article DOI: 10.53430/ijsru.2024.8.2.0051
Publication history:
Received on 02 August 2024; revised on 29 September 2024; accepted on 02 October 2024
Abstract:
The main objective of this research is to analyze the impact of several agricultural investments on corn production. The increasing trend in corn production in Jambi during the study years (1990-2022) is due to large increases in government improvement policy programs, such as price supports and input subsidy programs. Variations in area, yield, and output are also influenced by the prices of output and inputs such as fertilizer. The greater effectiveness of price support policies and input subsidy policies depends on the higher magnitude of the significant coefficients of these two variables. The first policy implication of the findings of this research is that price support policies are more effective and efficient in increasing areas. The influence of government support on corn prices is very important in analyzing the area response. Due to the role of government support on prices in the new environment, it has received much attention in policy implementation. When price support and the impact of market phenomena vary according to market conditions, price expectation measurement methods that analyze regional responses are used. This fact presumes that the impact of changes in government policy due to similar programs of territorial control and price supports is a likely form of future policy. A support and funding evaluation method was developed and tested to see the impact of changes in government programs. The results show that when price supports are far below expected market prices, the effect of cuts is negligible, and price support programs have only a small impact on acreage decisions. Alternatively, when price levels are favorable, the impact of cuts is greater, and the resulting impact on acreage decisions is greater.
Keywords:
Supply response; Corn; Production; Price policy program
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