Factors Affecting the Thai Natural Rubber Market Equilibrium: Demand and Supply Response Analysis Using Two-Stage Least Squares Approach

<p>Natural rubber is a major export crop and the sector is an important source of employment in Thailand. Very few rubber studies in the past have examined the demand and supply equations simultaneously and the previously results are dated. The objectives of this study was to estimate the econometric model of demand and supply of natural rubber in Thailand and determine if a relationship exists between the supply of rubber and its determinants. The data contained in the study are secondary time series annual data from 1977-2012. The instrumental variables estimation by two-stage least squares was used to solve and analyze the demand and supply of rubber. Results were statistically significant at 0.01 level, which showed that the U.S. GDP per capita, the estimated price, rainfall and rice price have a significant effect on quantity of rubber production in Thailand with an estimated elasticity of 1.4, 3.3, -3.6 and -2.6, respectively. The implications of the results are assessed through the lens of rubber producers, rubber consumers and agricultural policy makers.</p>

Name thesis:degree_name

MS in Agribusiness

Discipline thesis:degree_discipline

Agribusiness

Year dc:date.available

2014

Author dc:creator

• Chawananon, Chadapa

Contributors dc:contributor

• Sean Hurley

• natural rubber
• supply response
• Thailand
• simultaneous equation
• two-stage least squares
• instrumental variable estimation

Identifier

10.15368/theses.2014.65

OAI identifier oai:identifier

oai:digitalcommons.calpoly.edu:theses-2327