| Abstract |
- Edible tree nut and peanut industries are important agricultural
industries in the United States. Major tree nuts produced
domestically are almonds, filberts, pecans,and walnuts. The United
States imports and exports some quantities of these tree nuts and
peanuts, but at the same time the U.S. imports cashew, brazil,
pignolia, and pistachio nuts which are not domestically produced.
Tariffs on imported nuts are imposed, and there are marketing
orders or other programs which are in operation in the marketing of
several of the domestically produced nuts. Demand interrelationships
between nuts are of importance for pragmatic policy formulation for
tariffs for imported nuts and marketing control of domestically
produced nuts.
The overall objective of the study was to formulate and test
economic hypotheses of related demands for eight tree nuts and
peanuts, thereby classifying them into categories of substitutes,
complements, and independents in demand. The U.S. consumption
data on tree nuts and peanuts for the years 1947-68 were used for
analysis purposes. All the nuts were converted on a shelled basis
by using appropriate shelling ratios. Adjustments were made for
missing inventories. Results of other studies relevant to this
study were investigated and were modified.
In order to achieve the overall objective, different econometric
models employing the single stage least squares (OLS)
approach were used for estimation purposes. A double precision
and an extended precision; stepwise, time series, correlogram,
and autoregressive transformation algorithms were used for
analysis purposes. Stability conditions for estimated demand
curves using the Chow-test were tested, and the demand curves
were found to be stable over the time period of this study. According
to the Kamien-condition, interrelated demands were identified.
Tests of the severity of multicollinearity were performed.
Second-order autoregressive scheme in the time series data employed
was detected by the use of correlograms algorithm and a
second-order autoregressive transformation was made to arrive
at efficient estimates of the parameters.
The study revealed that theoretical hypotheses of the ordinal
theory of related demands such as the "Hotelling-condition," and
the "Slutsky-Friedman condition," were, in general, inconclusive
as a method of classifying tree nuts and peanuts as substitutes,
complements and independents in demand. However, pecans and
walnuts, pecans and brazil nuts, brazil nuts,and cashews were
found to be substitutes; whereas almonds and filberts, pecans and
pistachios were complements in demand. Except for some nuts
with conflicts in signs, all other nuts were found to be statistically
nonsignificant, and therefore, may be classified as independents in
demand.
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