APPLICATION OF MATHEMATICAL PROGRAMMING MODELS SIMULATING COMPETITIVE MARKET EQUILIBRIUM FOR AGRICULTURAL POLICY AND PLANNING ANALYSIS

In this paper, recent theoretical advances of modeling are amplified and applied to a sample linear programming problem to demonstrate its usefulness for policy analysis. Policymakers and planners in agriculture are looking for analyses that will aid them in appraising what future levels of production may be expected at alternative price levels. This requires knowledge of what changes result from different supply-demand balances due to possible input scarcities, changes in productivity under alternative technologies and changes in consumer's preferences. The objectives of this paper are to (1) restate the theoretical underpinning that are useful for this analysis by specifying the complete model; (2) to demonstrate how the model can be solved using linear programming techniques; and, (3) demonstrate how the model can be used in policy analysis.