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Potential Self-Sufficiency in Major Egyptian Crops: Necessary Production and Price Policies As Estimated by an Econometric Model

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Potential Self-Sufficiency in Major Egyptian Crops: Necessary Production and Price Policies As Estimated by an Econometric Model Iowa State University Capstones, Theses and Retrospective Theses and Dissertations Dissertations 1982 Potential self-sufficiency in major Egyptian crops: necessary production and price policies as estimated by an econometric model Riad El-Sayed Emarah Iowa State University Follow this and additional works at: https://lib.dr.iastate.edu/rtd Part of the Agricultural and Resource Economics Commons, and the Agricultural Economics Commons Recommended Citation Emarah, Riad El-Sayed, "Potential self-sufficiency in major Egyptian crops: necessary production and price policies as estimated by an econometric model " (1982). Retrospective Theses and Dissertations. 7034. https://lib.dr.iastate.edu/rtd/7034 This Dissertation is brought to you for free and open access by the Iowa State University Capstones, Theses and Dissertations at Iowa State University Digital Repository. It has been accepted for inclusion in Retrospective Theses and Dissertations by an authorized administrator of Iowa State University Digital Repository. For more information, please contact [email protected]. INFORMATION TO USERS This was produced from a copy of a document sent to us for microfilming. While tl most advanced technological means to photograph and reproduce this docume have been used, the quality is heavily dependent upon the quality of the mater submitted. The following explanation of techniques is provided to help you understai markings or notations which m'ay appear on this reproduction. 1.The sign or "target" for pages apparently lacking from the document photographed is "Missing Page(s)". 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ZEEB RD., ANN ARBOR, Ml 46 8221182 Fmarah, Riad El-Sayed POTENTIAL SELF-SUFFICIENCY IN MAJOR EGYPTIAN CROPS: NECESSARY PRODUCTION AND PRICE POUCIES AS ESTIMATED BY AN ECONOMETRIC MODEL Iowa State University PhJD. 1982 University Microfilms lnt©rnati0nsil 300N.ZeebRoatAnnAAor.MI48106 Potential self-sufficiency in major Egyptian crops: Necessary production and price policies as estimated by an econometric model by Riad El-Sayed Emarah A Dissertation Submitted to the Graduate Faculty in Partial Fulfillment of the Requirements for the Degree of DOCTOR OF PHILOSOPHY Department: Economics Major: Agricultural Economics Approved: Signature was redacted for privacy. In Charge of Major Work Signature was redacted for privacy. Signature was redacted for privacy. Iowa State University Ames, Iowa 1982 ii TABLE OF CONTENTS Page CHAPTER I. INTRODUCTION 1 Statement of the Problem 2 Objective of the Study 3 CHAPTER II. REVIEW OF LITERATURE 5 CHAPTER III. THEORETICAL AND STATISTICAL MODEL 21 7.aeoretical Model 22 Structural Equations 32 Estimation Procedures 58 CHAPTER IV. THE STRUCTURE OF THE AGRICULTURAL SECTOR IN EGYPT 73 The Land 73 Labor 82 Management 83 Capital 86 Crop Rotations 93b Wheat 93b Beans 95 Berseem 100 Winter Vegetables 101 Corn 101 Rice 103 Sugarcane 105 Cotton 108 ixi Page Summer Vegetables 109 Price Structures 110 Cost Structures 113 CHAPTER V. POTENTIAL SELF-SUFFICIENCY OF THE MAIN AGRICULTURAL PRODUCTS 116 Econometric Results 119 Farmers' Response 119 Supply Side 139 Wheat 139 Beans 146 Com 153 Rice 156 Sugarcane 159 The Supply Side Forecasts 164 The Demand Side 169 Econometric Results 172 Wheat 172 Beans 179 Corn 181 Rice 186 Sugarcane 190 The Demand Side Forecasts 191 CHAPTER VI. THE ALTERNATIVE SELF-SUFFICIENCY POLICIES 198 iv Page Sudan-Egypt Integration 207 CHAPTER VII. SUMMARY AND CONCLUSIONS 209 Summary 209 Conclusions and Policy Implications 214 Suggestions for Future Research 215 REFERENCES 217 ACKNOWLEDGEMENTS 222a APPENDIX 222b V LIST OF TABLES Page The physical classification of the Egyptian farmland 75 The results of the economic classification in the period 1961-70 as compared to the period 1971-1975 76 Distribution of the land ownership in 1965 as compared to 1952 78 ALS best fit of the time equations of employment and wages in the agricultural sector as compared to all other sectors in Egypt through the period 1972-1977 80 Time rates of growth in employment and wages in the agricultural sector as compared to all other sectors in Egypt, 1972-1977 82 Number of cooperatives and number of members of these cooperatives in Egypt 84 Gross fixed investment according to the economic activity 88 National income per economic activity 90 ALS best fit of the time equations of short, intermediate, and total loans available for the Egyptian agricultural sector 93a Rank of Egypt among the major wheat producing countries according to the productivity per feddan, 1975-1977 94 Time rates of growth for the study's major crops for various periods 96 Rank of Egypt among the major bean producing countries according to the productivity per feddan, 1975-1977 99 vi Page Table 4.13. Rank of Egypt among the major com producing countries according to productivity per feddan, 1975-1977 100 Table 4.14. Rank of Egypt among the major rice producing countries according to the productivity per feddan, 1975-1977 104 Table 4.15. Rank of Egypt among the major sugarcane producing countries according to productivity per feddan, 1975-1977 106 Table 4.16. Time rates of growth of the price of major crops for various periods 111 Table 4.17. Time rates of growth of the variable costs of major crops for various time periods 114 Table 5.1. Production, consumption, and percentage of self-sufficiency of the major agricultural products in Egypt 118 Table 5.2. Relative profitability of the major agricul­ tural crops, 1971-1979 121 Table 5.3. The relative probability matrix 123 Table 5.4. Wheat area's response to the relative profit­ abilities of the other major winter crops, stepwise results, 1971-1978 126 Table 5.5. Beans area's response to the relative profit­ abilities of the other major winter crops, stepwise results, 1971-1978 128 Table 5.6. Corn area's response to the relative profit­ abilities of the other major summer crops, stepwise results, 1971-1978 130 Table 5.7. Rice area's response to the relative profit­ abilities of the other major summer crops, stepwise results, 1971-1978 132 Table 5.8. Sugarcane area's response to the relative profit­ abilities of the other major summer crops, step­ wise results, 1971-1978 134 vii Page Table 5.9. The supply side forecasts for the year 2000 167 Table 5.10. The stepwise results for estimating the aggre­ gate demand function for wheat, 1965-1978 173 Table 5.11. The stepwise results for estimating the aggre­ gate demand function for com, 1965-1978 182 Table 5.12. The stepwise results for estimating the aggre­ gate demand function for rice, 1965-1978 187 Table 5.13. The demand side forecasts for the year 2000 193 Table 5.14. Consumption of the major crops in kilogram per individual 1973-1977 195 Table 6.1. Agricultural subsidy in thousand pounds, 1970-1979 202 Table A.l. Report of the Minister of Food and Agriculture about the agricultural production, consumption, and importation, 1960-1979 222 Table A.2. Actual and projected food deficits in selected less developed countries 223 Table A.3. Supply elasticities, by crop and region 224 Table A.4. Results of the soil improvement programs in the govemorates of Egypt 225 Table A.5. ALS best fit of the time equations for the study's major crops 235 Table A.6. ALS best fit of the time equations for the prices of the major crops 245 Table A.7. ALS best fit of the time equations for the nominal and real variable costs of the major crops 251 Table A.8. The stepwise results for estimating the aggre­ gate demand functions for beans, 1967-1978 253 viii LIST OF FIGURES Page Figure 6.1. Changes in the producer's surplus and costs to the Egyptian government due to the input subsidization policy 201 Figure 6.2. Changes in the producer's surplus and the costs to the government due to the output price support policy 203 Figure A.l. Lorenz curve for land ownership before and after the land reform laws 255 1 CHAPTER I. INTRODUCTION Agriculture was and still is one of the major sources for Egyptian national income. About 33 percent of the Egyptian national income orig­ inates in the agricultural sector. On the other hand, around 50 percent of the Egyptian population is in the agricultural sector. The cultivated area in Egypt is about 5.64 million feddan.^ Further, it is usually cultivated three times a year.
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