A Buffer Stocks Model for Stabilizing Price of Commodity under Limited Time of Supply and Continuous Consumption

Sutopo, Wahyudi and Bahagia, Senator Nur and Cakravastia, Andi and Samadhi, TMA. Ari (2008) A Buffer Stocks Model for Stabilizing Price of Commodity under Limited Time of Supply and Continuous Consumption. APIEMS.

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    Abstract

    Staple foods, in developing countries especially in Indonesia, have extremely volatile among harvest and planting season caused by inelastic of supply-demand and price disparity. When a staple food is shortage in market, it will trigger crisis of economics, political and social because it concerns with food security. This paper develops a buffer stock model for stabilizing price of commodity under limited time of supply and continuous consumption. The performance criterion of model will consider financial loss of producer, consumer and government side when market is interfered by price-stabilization program and price-support program simultaneously. The price fluctuation will be stabilized by market operation where buffer stocks are bought from domestic and import supply point. This paper provides a price band policy that attempts to bound domestic price variation between a set of upper and lower bounds on the level of domestic prices. We consider three sets of problems reflecting different three prices elasticity from 4 period of supply and demand. Numerical examples are found to be consistent with empirical estimates regarding the relationship price elasticity with price band and with government budget for the agenda of assisting household to assure availability a staple food with enough amounts at rational prices. Keywords: buffer stocks, price band, stabilization, limited time of supply, staple foods.

    Item Type: Article
    Subjects: T Technology > T Technology (General)
    Divisions: Fakultas Teknik > Teknik Kimia
    Depositing User: mr azis r
    Date Deposited: 20 May 2013 22:21
    Last Modified: 20 May 2013 22:21
    URI: https://eprints.uns.ac.id/id/eprint/756

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