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Title:Biodiesel profitability and linkages to the soybean oil market
Author(s):Zahran, Hala
Advisor(s):Irwin, Scott H.
Department / Program:Agr & Consumer Economics
Discipline:Agricultural & Applied Econ
Degree Granting Institution:University of Illinois at Urbana-Champaign
Degree:M.S.
Genre:Thesis
Subject(s):Biodiesel
Mandate
vector error correction model
long run equilibrium
zero profit relationship
Abstract:This thesis investigates the relationship between soybean oil and biodiesel markets in the US through a structural model and a time-series econometric model. A conceptual link is built based on the theories of market efficiencies and implications of a binding mandate on supply and demand. We hypothesize that a long run zero-profit relationship governs the biodiesel and soybean oil pricing relationships. We test for this using a structural model based on an Iowa biodiesel plant. We additionally use formal time series testing including Johansen Trace test and a vector error correction model and the Kejriwal and Perron test. We find that under certain policy conditions our hypothesis holds but not throughout the sample studied.
Issue Date:2013-08-22
URI:http://hdl.handle.net/2142/45274
Rights Information:Copyright 2013 Hala Zahran
Date Available in IDEALS:2013-08-22
Date Deposited:2013-08


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