AN ESTIMATION OF DEMAND AND SUPPLY FUNCTIONS FOR RICE IN IRAQ FOR THE PERIOD (1980-2005)

Abstract

Rice is considered one of the main cereal crop in the world and occupies the second rank after wheat in importance. In Iraq rice is one of the main summer cereal crops and it is an important food item in Iraqi nutritional pattern. The aim of this research is to determine the factors affecting demand and supply together in addition to the evaluation of public policies performance. The results showed that the factors affecting rice demand were rice price, wheat price, potato price, per capita income and time. On the other hand the factors affecting rice supply were cultivated area, rice price for the previous year, fertilizer price, and water consumption. Double logarithmic model was chosen to express the relation between dependent and independent variables. The results also showed that the satisfaction from rice consumption was high due to low income elasticity of demand as it was 0.281. The positive sign of income elasticity of demand refers to that rice is normal and necessary commodity. The results also showed that the relationship between rice and potato is substitutional and complementary with wheat. The supply function results showed that the development of cultivated area contributed to the production increase but not sufficiently. The results also showed that the price had a negative effect on production , which indicates the weakness of public price policy performance. The role of irrigated water was positive but weak. The results also showed that the farmers did not use this resource economically. Some recommendations were forwarded