Demand of Fertilizer in Least Developed Countries (LDCs).docVIP

Demand of Fertilizer in Least Developed Countries LDCs Abstract This study is attempt to examine the factors affecting demand of fertilizer in three selected least developed countries （LDCs）； Myanmar， Lesotho and Tanzania by using Ordinary Least Square （OLS） method. The theory of demand function has been applied to the analysis and the model has been transformed to log form for estimation purposes. Several tests have been conducted to detect multicollinearity， autocorrelation and heteroscedasticity. The finding reveals that cereal yield is statistically significant for all countries while price is only statistically significant for Lesotho. It is expected more robust result could be evidenced using larger data set， adding more variables and using other proxies for the variables. Key words： Fertilizer demand； LDCs； Ordinary Least Square （OLS）； Multicollinearity； Autocorrelation and heteroscedasticity INTRODUCTION The role of fertilizer cannot be denied in the agricultural production and development worldwide. Fertilizer demand is influenced by global circumstances which it depends on the self sufficiency of food and fertilizer in the country. Food production has to be increased in order to support rising in global population by 2050. Europe is the most developed organic fertilizer market and it has the largest production capacity. Products of various qualities and origins are sold for agriculture （30-40%）， landscaping（30%）， hobby garden （30%） and other areas （ 10%）. This mature European market is marked by demand for high quality. However， the quality criteria for such products vary in European countries concerning the amount， the requirements and the limited values for a certain number of ingredients. In many countries fertilization is insufficient to meet world demand which is remarkable increasing over the year particularly in developing economies （Figure 1）. Surprisingly， fertilizer demand in least develop countries （LDCs） is very low as compared to other develo