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Thesis (M.S.)—University of Nebraska—Lincoln, 1967. Department of Agricultural Economics.


Copyright 1967, the author. Used by permission.


The objective of this study is to present a spatial equilibrium international trade model that can be used to project effects of the E.E.C. and its Common Agricultural policy on the E.E.C.’s demand for U.S feed grains. The model is an adaptation of an interregional activity analysis model by Takayama and Judge. It has been modified to simulate international trade and adapted to the CDC 3600 computer by D. Lee Bawden of the University of Wisconsin. The objective of the model is to determine probable results of changes in agricultural and trade policies by foreign governments. It goes beyond normal commodity by commodity projections of demand and supply in that it considers the many interrelationships involved in international trade.

The purpose of this thesis is not only to present a spatial equilibrium model but to use a smaller model and hypothetical data to demonstrate the usefulness of the large one. This smaller model will be used because of the prohibitive costs of running the large model merely for purposes of illustration. Since both models involve many variables and interrelationships, it is desirable to know just how sensitive these variables are. Such knowledge is necessary to determine the effectiveness of the model. The small model will be used to test interrelationships and to apply them to the large model.

In summary, the objectives of this study are twofold: (1) to present a special equilibrium international trade model, and (2) to use a smaller model to demonstrate the usefulness and show the sensitivity of the large model. This will be done by studying the effects of model modifications mainly in the area of E.E.C. demand for U.S. feed grains.

The hypothesis is that the interregional trade model presented in this thesis is a better tool for policy analysis than conventional commodity by commodity methods of estimation. This study is a part of a larger project, Implications of the European Economic Community, being conducted by the N.C.M. 33 committee of the North Central Region.

Advisor: James Kendrick