SUPPLY AND DEMAND EQUATIONS FOR LIVESTOCK PRODUCTS IN NIGERIA: A SIMULTANEOUS EQUATION APPROACH

Abstract

In this study, an attempt was made to estimate Nigeria's demand and supply equations for livestock products using the simultaneous equation model. The parameters of the specified structural equations were computed from the reduced equations using the Inverse Least Square (ILS) approach. The results show that price is the major-determinant of livestock products' supply and demand. Price elasticities of supply and demand were 0.5577 and 0.3309 respectively. Also, demand was national income elastic (1.2862). Pro­jecting into future demand and supply shows that between 3999 and 2005, supply would be short of demand by an average of 17,466 tonnes. To therefore increase livestock products supply, governments at all levels must provide incentives for enhancing sustainable livestock production. This is expected to lead to increased demand if there is reduction in prices.