An examination of impact does existing subventions have on the prices of red meat in domestic market

Purpose of this study, in which potential of livestock sector in Turkey is investigated, is to determine what kind of effect does existing subvention and supports have on the prices of red meat in domestic market. Conditions of decreasing effects on prices or reasons of increasing trend price movements will be studied in the context of government made subventions. At the same time, factors that have an impact on meat prices indrectly, directly and in a roundabout way such as feed industry, distribution and delivery, optimum business sizes will try to be explained by sectoral innovation situation. As it is in all production areas, importance of organising and cooperating on livestock branch and its development in Turkey are stated. This study aims to test relation between money value of grants on livestock based on USD and prices of red meat on USD by using data for Turkey between 1990 and 2018 with time-series analysis. At first, stability analysis of variables are done by ADF and PP unit root tests then in all aplied tests, it is seen that all variables include degree/level value unit root and when primal differences are taken, they are in the level of 5% stability. On the next step, existance of a relationship between variables in the long term is examined with Johansen cointegration test based on VAR. How long did it take to get over shocks that occured in short term with VECM is studied. With the findings that are obtained, it is confirmed that subventions has a decreasing effect on red meat prices and it is determined that wealth and consumption of red meat established a pressure on the increase of red meat price. These findings are interpreted like size of the effect of subvention on price is based on structural reforms and prices are depended on subvention to some degree.