1964 MEAT CONSlJbPTION IN AUSTEALIA 127

A REPLY MEAT CONSUMPTION I N AUSTRALIA-

Calculation Errors I am grateful to Messrs. Duloy and van de Meulen’ for their

“casual examination” of my Considerable rechecking has indeed uncovered some errors, but the broad conclusions are not, I think, af€ected.

(1’) C B = 3.84-*0.87 PB-0°-098 cs R2 = 0.80 The corrected results are as follows:

(0.36) (0.18) (2) Py = 1.21 - *0.82 Cy + *1.32 PB - *0.29 CL R2 = 0.97

(0.10) (0.17) (0.093)

(0.063) (0.11) (0.07) (3) PL = 2.10- *O’68 CL + *0*31 PB + 0.08 Cx R2 = 0.98

(4) CB = 3.95-*1.03 PB R2 = 0.80 (5) R2 = 0.97

The coefficients which has been found significant at the 5 per cent level using the simple “t” test have been starred: they are the same as before.

The main change in the actual equations has been in the intercept of 2. The standard errors in 3 and 5 are now dserent , mostly lower and substantially so in some cases.

Apart from built-in checks, the equations have been checked by simply correlating the expected and observed values of the dependent variables; it has also been verified that when the mean values of the independent variables are substituted in the formulae, the mean values of the respective dependent variables are obtained. The Model

Messrs. Duloy and van der Meulen criticized my model on the ground that the correlation between beef wholesale and retail prices was found by them to be low. I did not expect that there would be any such simple relationship between these prices, and my model does not require it; I should expect this relationship to be complex, probably involving lags and “smoothing” or averaging.

In their comments on collinearity found to exist between retail price of beef and consumption of sheepmeats, my critics seem to imply that correlation cannot exist without direct causal relationship. More- over, if beef prices were influenced by the supply of other meats as they suggest, a negative relationship must surely be expected, whereas the correlation was, in fact, positive.

C m b erra.

September 1963, pp. 366-7.

PL = 2.01 - *0*49 CL + 0.30 PB (0.05) (0.097)

Q. W. TAYLOR

1 “Meat Consumption in Australia-A Comment“, Economic Record, Vol. 39,

2 G. W. Taylor, “Meat Consumption in Australia”, Economic Record, Vol. 39, March 1963, pp. 81-7.