Browsing by Subject "Cotton -- Prices"
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Item A multi-stage hedonic analysis of cotton fiber attribute values in the Texas and Oklahoma producer cotton markets(Texas Tech University, 2001-05) Hoelscher, Kevin RichardThe objective of this study was to determine how changes in cotton fiber attribute values for the Texas and Oklahoma cotton marketing regions are influenced by separate buyer and seller actions with regard to these attributes. This study utilized daily spot market transactions for the 1993/94 through 1999/2000 marketing years for Texas and Oklahoma to formulate hedonics model for each year and capture the effects of fiber quality attributes on spot market prices. These models were used to derive the marginal implicit price of each characteristic for each day of the seven-year period, which were then aggregated to produce an average marginal implicit price for each week of this period. The marginal implicit values were then examined by formulating second-stage hedonic models to represent the bid and offer functions of cotton sellers and buyers for each characteristic. These models were estimated simultaneously using price-dependant offer functions and characteristic-dependant bid functions. The results of the first-stage hedonic analysis and the derivation of the marginal implicit prices of each characteristic revealed results in which undesirable characteristics had an adverse impact on cotton prices, resulting in negative marginal implicit prices. Beneficial or desirable quality characteristics were characterized by positive marginal implicit prices, reflecting their positive impact on cotton prices. Second-stage results showed offer functions in which buyers were willing to pay more for higher levels of desirable characteristics and less for higher levels of undesirable characteristics. These offer functions were affected by external factors such as trends in characteristic values as well as forward contracting and net exports levels. Additionally, the previous month's general level of cotton prices indicated that an increasing general price level caused a reduction in the prices of certain characteristics. Estimated producer bid functions indicated that producers would expect higher payments for higher levels of desirable characteristics and would accept lower prices for higher levels of undesirable characteristics. These bid functions were affected by external stimuli such as characteristic price trends, trends in characteristic levels, forward contracting levels and environmental variables such as rainfall and temperature. The results of this study provide an empirical application of a two-stage hedonic framework, and is the first to present the perspective that second-stage hedonic estimation is the estimation of characteristic bid and offer functions rather than supply/demand relationships. In addition, several questions were raised concerning the relationship between general price levels and characteristic price levels as well as the contribution of characteristic values to the overall price of a commodity. This study provides the groundwork for future research which can be devoted to answering these questions.Item A multi-stage hedonic market model of cotton characteristics with separable supply and demand(Texas Tech University, 1989-05) Bowman, Kenneth RayThis study examined the impacts of fiber characteristics on cotton prices from 1976 to 1986 for 4 production and marketing regions of the United States. A set of 11 equations were estimated to determine the effects of cotton fiber characteristics on cotton prices. Trash, color, staple length, micronaire, and strength were found to have statistically significant impacts on cotton prices. Length uniformity was not statistically significant. Characteristic effects were found to vary across time and across regions. However, trends in attribute values were similar for all characteristics across all regions. Characteristic price flexibilities were calculated using the regional base prices and characteristic averages of each year. Cotton prices were not price responsive with respect to characteristic variation. In this context, percentage changes in characteristic levels did not cause equivalent percentage changes in cotton prices. A set of 24 equations found that cotton characteristic values were functions of other characteristics as well as characteristic specific demand shifters, base price and proportion of open end spindles to ring spindles. Characteristic impacts on characteristic values were similar across regions, though some variation of effects were present. The effects of base price were also similar across regions. The proportion of open end spindles to ring spindles affected characteristic values with the largest impacts occurring in the West. Separate systems of equations were constructed to estimate the effects of environmental variables on each cotton characteristic in each production region of the country. Seasonal rainfall and temperature affected characteristics in all regions though parameter estimates and functional forms varied considerably among production areas. There is a growing recognition of the need to understand the values of fiber characteristics. Fiber characteristic values affect the revenues of producers and the costs of buyers. The results of this study demonstrate that there is a functioning market for cotton characteristics. The characteristics model constructed in this paper is useful because it presents an alternative to the current method of determining fiber quality premiums and discounts.Item A study of the Economic Effects of Field Extraction of Cotton Upon Cost of Harvesting and Processing Cotton(Texas Tech University, 1973-05) Sherwood, Steven JNot Available.Item Econometric analysis of the structural relationships of the U.S. cotton economy(Texas Tech University, 1984-12) Alipoe, Dovi-Akue KThe federal government has intervened extensively in the cotton economy of the U.S. since 1933. After five decades, governmental policies and economic and technological developments have produced a downward long-term trend in planted acreage. Goals of price and income stability at the farm level have not been fully realized because of an imperfect knowledge of the relationships in the sector. The objectives of this study were to Cl) identify and estimate the structural relations of the U.S. cotton economy with alternative single equation and multiequation methodologies and (2) simulate policies involving supply controls. Commodity Credit Corporation loan rates, and U.S. export financing. The alternative estimators of the structural relationships were validated with the use of Theil's inequality coefficients, the RMSE's, and the turning points. The I3SLS model provided better estimates of the endogenous variables than the 2SLS, 3SLS, and SUR models. Results indicated that the price competition between cotton and polyester have diminished from the 1960's to the 1970's. Cotton price elasticities of mill demand and export demand obtained from the I3SLS were -0.47 and -5.64, respectively. In the world market, the main criterion of competition between Upland cotton originating from various exporting countries is the world price. The elasticity of price transmission between U,S. domestic prices and world prices is 0.57, The Almon lag model revealed that the full impact of changing fiber prices is realized in five years. The main policy implications of the ex ante simulation scenarios are: - The Commodity Credit Corporation loan policies, if discontinued in combination with reasonably restrictive supply controls, would create the most distortion the first year. Subsequent adjustments would take place in the domestic fiber economy, and gross farm income loss would be minimized or reduced to zero after six to seven years following the initial shock. - Highly stringent supply control policies would result in higher farm prices. However, they would also cause gross farm income to fall due to the severe decline in quantities of disappearance. - Export financing increases export volumes. However, it tends to also put upward pressure on domestic and world prices, causing U.S. cotton to be less competitive.