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Abstract
The Australian banana industry is an example where neither the time series
data necessary for estimating grower responses nor the detailed cross
sectional data on individual inputs are readily available to enable
econometric estimation of producer response to price or cost changes.
In this paper a calibration method of a CES production function, based on
cost shares of variable and fixed inputs in total production cost, is used to
approximate regional supply elasticities for banana growers in Australia.
Although this approach to estimation may not be the ideal, it appears to
produce plausible results.