The Overshooting Hypothesis of Agricultural Prices: The Role of Asset Substitutability

By allowing for various degrees of asset substitutability between bonds and agricultural products, this paper reexamines the robustness of the overshooting hypothesis of agricultural product prices. It is found, in both a closed economy and an open economy, that the crucial factor determining whether agricultural prices overshoot or undershoot their long-run response following an expansion in the money stock depends upon the extent of asset substitutability between bonds and agricultural goods.


Issue Date:
2005-04
Publication Type:
Journal Article
PURL Identifier:
http://purl.umn.edu/30784
Published in:
Journal of Agricultural and Resource Economics, Volume 30, Number 1
Page range:
128-150
Total Pages:
23




 Record created 2017-04-01, last modified 2017-08-24

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