Regional hog supply response to stabilization programmes in Canada

The objective of this research was to determine the nature of hog supply response in Quebec, Ontario and Alberta over the period 1968-1986. Special emphasis was placed on the role of government stabilization programmes. The research examined the development of the North American hog industry and described the various federal and provincial assistance programmes that were available to hog producers over this period. Using an adaptive expectation framework, separate linear equations for each province and three pooled data equations were specified. The equations were estimated using four procedures namely, Hildreth-Lu, instrumental variables, quasi-generalized least squares and augmented least squares. Results indicate that (1) stabilization programmes exhibit positive effects in Quebec and negative effects in Alberta and Ontario, although in no province are these coefficients statistically significant and (2) that response to risk varies across provinces. This research concludes that other factors including vertical integration and western grain market conditions may have been important factors in production shifts during this period