Research of the Relationship Between Supply-Distribution Adjustments and Regulation Mechanism in Taiwan Meat Market After Trade Liberalization
Date Issued
2011
Date
2011
Author(s)
Lin, Sheng-Ching
Abstract
After Taiwan pig''s industry faced shocks of the pig''s foot-and-mouth disease incident and accession to WTO, the phenomenon of high fluctuation in its prices becomes obviously under the market-oriented attitude sold inside the country. In such a case, the actual equilibrium in meat price and quantity of pork products is established by estimating the number of heads for auction and through the supply-distribution adjustments and regulation mechanism for the negotiated number of pigs to auction. It is apparent that the mechanism mentioned above is important to supply and marketing in the meat market.
The monthly data collected in the study is based on the record of adjustment-regulation mechanism meeting from January 2005 to June 2010. In addition, the study investigates the relationship between supply-distribution adjustments and regulation mechanism in Taiwan meat market based on supply and demand theory with the help of practical business experience. The methodology of the study consists of descriptive statistics and simple regression models which analyze the price-quantity relationship under auction, including the variables of the average daily, the monthly, and lunar-year-holiday heads of pigs for auction. The results have the following findings：(1) The monthly estimated and negotiated heads for auction shows a highly positive relationship and the difference between these two exists with a constant value. It reveals the result of the operation procedure in the mechanism. (2) The relationship between the number of monthly (and daily) negotiated and actual heads for auction presents a highly positive correlation. This indicates the ability of the mechanism for predicting the number of actual heads for auction. (3) During the lunar-year holiday, the relationship between the number of heads in negotiation and that in actuality is also highly correlated which indicates the role of the mechanism in efficiency. (4) The change of monthly average price and annual average price presents the same trend during the lunar-year holiday. This indicates that the mechanism can also provide the function of keeping the auction price in steadiness. All of findings above shows that the mechanism plays an important in adjusting pig supply and provides equilibrium in supply and demand.
Subjects
meat market
supply-distribution adjustments
regulation mechanism
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