Determinants of fertiliser demand: a preliminary analysis
1990
Jones, D. (MAF Corporate Services, Wellington (New Zealand). Policy Services)
The importance of fertiliser to New Zealand agricultural production has been well documented. Perhaps less well understood are the factors influencing farmer demand for fertiliser, particularly in the restructuring period of the last six years. In looking to understand and forecast fertiliser demand, it was found that models of fertiliser demand which considered only income and price had worked successfully up until the early 1980s but contributed little to our understanding of fertiliser demand in the mid to late 1980s. This paper attempts to provide some answers to this problem by considering the influence of government assistance, previous levels of fertiliser use and the interest commitment of farmers. It was concluded that fertiliser should be viewed as part of a basket of farm inputs from which farmers must choose the appropriate mix, and that expenditure on this basket has been crowded out by the interest commitment of farmers
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