Agricultural Science Digest

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Agricultural Science Digest, volume 39 issue 1 (march 2019) : 8-14

Price and non-price decision making factors of groundnut production in Karnataka: evidence from vector error correction model

S.M. Jainuddin, Seema, K. Suhasini
1Department of Agricultural Economics, University of Agricultural Sciences, Raichur-584 104, Karnataka, India.
Cite article:- Jainuddin S.M., Seema, Suhasini K. (2019). Price and non-price decision making factors of groundnut production in Karnataka: evidence from vector error correction model. Agricultural Science Digest. 39(1): 8-14. doi: 10.18805/ag.D-4835.
The study was conducted in Karnataka state with an objective to assess the decision making factors in land allocation sustainability of groundnut production. The results of the coefficients of area response of groundnut indicated that the total rainfall had exerted significant positive influence on current year’s area of groundnut in Mysore division and Karnataka. The coefficients of production response of groundnut indicated that the lagged production had exerted significant negative influence on current year’s production of groundnut in Bangalore, Gulbarga and Karnataka. The result showed that long run relationship existsed between dependent and independent variable in some divisions. The results indicated that the price inelasticity of supply in both short run as well as long run all the division except some. The study concluded that non-price determinants were more significant for decision making and complementary to price for land allocation in sustainable production of groundnut in the state.
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