The Egg Cycle and the Ability of Recursive Models to Explain It

David G. Hartman

American Journal of Agricultural Economics, 1974, vol. 56, issue 2, 254-262

Abstract: The often-discussed instability of the price of eggs is examined by use of spectral analysis, and the existence of an egg cycle is confirmed. In explaining the cycle, the familiar cobweb model is shown to be inferior to an alternative model. The alternative model, proposed by Nerlove, has producers planning changes in their production levels in response to prices, with the changes being realized only after a lag. Economic justifications are given for such producer behavior to continue, even though it causes instability. Recent destabilizing influences, not related to the cycle, are also discussed.

Date: 1974
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Persistent link: https://EconPapers.repec.org/RePEc:oup:ajagec:v:56:y:1974:i:2:p:254-262.

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