Assessment of trends in the functioning of the grain industry of the EU countries using ARDL modeling

• Published in: IOP conference series. Earth and environmental science 2024-12, Vol.1415 (1), p.012045
• Main Authors: Mandych, O V, Staverska, T O, Kemza, R G, Makohon, V V
• Format: Article
• Language: English
• Subjects: Agricultural economics; Agricultural production; Autoregressive models; Costs; Grain; Modelling; Productivity; Wheat
• ISSN: 1755-1307; 1755-1315
• DOI: 10.1088/1755-1315/1415/1/012045

The application of ARDL modeling at the macroeconomic level for the analytical description and analysis of dependencies of production productivity in the grain industry on natural-climatic, technical-technological and marketing factors is studied. It is determined that the construction of the production function for the agrarian sector determines the consideration of internal and external factors of the organization of production and the conditions for its conduct. Another difficult point is the asynchrony of the dynamics of prices for grain and production resources, which necessitates bringing the indicators of costs and output to a comparable form, which determines the artificiality of comparison and non-stationarity of the dynamic series included in the model. It has been proven that the means of overcoming these obstacles is the application of the dependent lag autoregressive model (ARDL). The non-equivalence of the influence of individual factors on the dynamics of yield has been established. In particular, the p-value at the level of one percent has the payback of costs for the production of soft wheat grain in the reporting year, its first and third lag, as well as the second and third lag of payback of costs for the production of durum wheat. At the same time, there is an alternation of the sign of regressors, due to a decrease in prices in years of excess grain production and their increase in lean years. Likewise, the value of the unit cost regressor is also negative, while their lags according to the AIC criterion were not included. The prerequisite for this is the industrial nature of the technologies used. Thus, with an average yield of about 70 c/ha, the variation of the latter over the 29 years of the study did not exceed 7%, and therefore the increase in unit costs, and, accordingly, the yield, but does not provide a simultaneous increase in income due to a decrease in prices. In view of this, a negative value is logical cost regressor. Under such conditions, further study of the prerequisites should be aimed at studying the behavior of lag values of costs and the impact on their formation of a common European policy of regulating the productivity of agricultural production.