An Analytical Evaluation of Production-Price Relation in Potato Production Using Koyck Approach (The Case of TR 71 Region)

Abstract

In this study, the interaction between potato production and its price from 1991 to 2012 was analyzed using Koyck approach, one of the distributed lag econometric models. The amount of potato production can increase or decrease in the current year based on the prices of previous year, as a product that is appropriate for cobweb theorem, one of economic facts. According to the results of Koyck model, it was determined that potato was affected by the prices of maximum two years retrospectively, and that 1.45 years were needed so that the change in potato prices could have a significant and considerable effect on potato production. On the other hand, while a TL 1 increase in potato prices in the current year increased potato production 711151.80 tons, a TL 1 increase in the prices of previous year increased the production 421001.86 tons and a TL 1 increase in potato prices two years previously caused 249233.10 tons increase in production. In conclusion, the following issues can be considered as measures to be taken economically: creating producer-consumer chain by setting up effective marketing organizations and therefore avoiding problems such as surplus supply or surplus demand, creating both more efficient and better quality production structure by planning the production, and providing stable production and stable price policies by establishing supply and demand balance.