Wereimportantanddynamics neededtobeexplicit how long

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Unformatted text preview: h various rotations entered as single­decision variables. Under old­style farm bills that used 3­year and 5­year averages to determine program “base,” the adjustment paths to changes in prices etc. were important and dynamics needed to be explicit. How Long? How Trade­offs between time coverage and size of model. Time horizon must be long enough so that alterations in its duration do not impact the initial period solution, if the initial period solution is of interest to the modeler. If first period is not of interest, model period must be long enough that the variables of interest are not affected by extension of the model. How Long, continued? How A problem: size limits on model may make the previous goals impractical. An alternative is to define a feasible size and then introduce terminal conditions for in­process inventories or left­over resources. McCarl and Spreen provide references for further discussion of model period length. Time Intervals Time Periods may be of uniform or variable duration. Years, quarters, months, weeks, have all been used as time intervals. Model size increases rapidly as time intervals become shorter. It is possible to have weekly detail on some variables but coarser detail on others. Initial and Terminal Conditions Initial Terminal conditions should be set to reflect the value of in­process inventories – e.g. trees in the field, cattle being fed, etc. Initial conditions should reflect likely inventory on hand, cash on hand, etc. Often initial conditions are specified as exogenous (so many acres of tree...
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This note was uploaded on 11/15/2011 for the course AGEC 7100 taught by Professor Duffy,p during the Fall '08 term at Auburn University.

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