Supply response of tobacco farmers in Trinidad and Tobago
Keywords:Tobacco, Trinidad and Tobago, Supply response, Distributed lag model
AbstractA tobacco company, in a ten-year programme, proposed to expand the production of leaf tobacco in Trinidad and Tobago. The plan, which started in 1968, was aimed at producing 450 000 kg of leaf tobacco from 400 ha. The production of the crop expanded initially but later declined. This study attempts to determine the factors affecting the production and hypothesizes a positive supply response of the farmers to changes in the real price of tobacco. The farmers were found to be positively price responsive and the real price of tobacco was the only variable which had a significant effect on the supply of the crop.