World Rubber Market Structure and Stabilisation: An Econometric Study

摘要

This study examines some problems in the market for natural rubber, one of the ten core commodities proposed for stabilization under the UNCTAD Integrated Program for Commodities, and the first for which an international agreement was reached. The first part of this study is concerned with the specification, estimation and validation of an econometric model of the world natural and synthetic rubbers market. The disaggregated annual model for 1956-1978 consists of two submodels, one for each rubber, and reflects their different industrial organizations. Other salient features of the model are the long lagged structures and the interaction between the submodels through relative rubber prices in the demand equations. The model validation shows that the secular decline in natural rubber price up to 1973 was due primarily to the substitution of natural rubber by the cheaper synthetic rubbers. The second part of this study concerns the application of the model to forecasting natural rubber prices and to analyzing the implications of natural rubber market stabilization along the lines of the International Natural Rubber Agreement. The impact of national government interventions in world commodity markets is also illustrated by an examination of the impact of changing Malaysian export taxes.