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Abstract

In the ORANI general equilibrium model, the supply behaviour of agricultural industries is the crucial element shaping the response of agriculture as a whole to any exogenous shock. In this paper, elasticity formulae which measure agricultural supply behaviour in the model are derived. These elasticities are found to be very sensitive to year-on year changes in the level of agricultural profitability, embodied within the model's data base. The appropriate procedure, therefore, is to construct a synthetic data set designed to capture the agricultural sector in a recent average year. Supply elasticities based upon these data represent the "preferred" estimates of this study.

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