Estimation of acreage response functions for cotton in Maharashtra

Abstract

This study is devoted to the estimation of acreage response functions for cotton. In respect o cotton production, it is confined to the important districts of Bombay, Poona and Nagpur divisions and to the Maharashtra state as a whole. The current year cotton acreage was mainly explained by its previous year price and yield relative to jowar and bajara. A time-trend variable. To take care of unquantified technological changes was also included in acreage response functions. Data on prices, yields and acreage for the period 1950-51 through 1969-70 were taken from various publications of the Directorate of Economics and Statistics, Ministry of agriculture. The adjustment lag models and some traditional models were used for evaluating the acreage response functions. These functions were estimated for the original value of the variables and for logarithmic values. Using classical least square approach. The results of the analysis indicated that the acreage under cotton was in elastic to changes in price of cotton relative to jowar price in all the divisions and in Maharashtra state as a whole. Contrary to our exceptions own price and relative (to bajara) price variable’s effect in Bombay division was negative. However, it was not significant. The coefficients of cotton yield and relative to jowar yield variables were positive in all divisions except in Poona. Trend variable had a positive significant influence only in Nagpur division. Lag acreage variable made a significant contribution in deciding about the size of the cotton crop in the current year. Functions fitted to the logarithmic date were not established superior over the functions evaluated from the original data. Forecasting of cotton acreage had also been done which is desirable for policy formulations. Acreage elasticities for cotton with respect to cotton, jawar price ratios were evaluated. High elastic ties of the order of .22 in the short-run and .32 in the long-run were obtained in Poona division, The estimates of elasticities for Bombay division, Nagpur division and Maharashtra state were .007, .011 and .031 respectively in the short-run. The long-run figures for Nagpur division and Maharashtra state were .035 and .089 respectively. The estimates of coefficient of adjustment revealed that the acreage under cotton got adjusted faster in Poona division than in the remaining areas under study.