02151cas a2200265 a 4500 AALejournalIMF007098 230101c9999 xx r poo 0 0eng d 5.00 USD 9781455228065 1018-5941 BD-DhAAL BD-DhAAL Funke, Norbert. Reviving the Competitive Storage Model : A Holistic Approach to Food Commodity Prices / Norbert Funke, Weifeng Wu, Yanliang Miao. Washington, D.C. : International Monetary Fund, 2011. 1 online resource (47 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students We revive in this paper the empirical relevance of the competitive storage model by taking a holistic approach to food commodity prices. We augment the seminal Deaton and Laroque (1992, 1996) model by incorporating more comprehensive and realistic supply and demand factors: output and demand trends, shocks to the yield, and time-varying interest rates. While the computational burden increases exponentially, the augmented model succeeds in replicating all four key patterns of food commodity prices. Our simulation and comparative statics also show that (i) the long-run declining trend of food prices may come to a halt or even reverse due to the shifting balance between supply and demand; (ii) short-run price fluctuations are mainly attributable to sizeable, though low-probability, shocks to output such as inclement weather; and (iii) the impact of monetary policy, though small in normal times, is nonlinear and asymmetric, and can become large if the real rate passes a certain threshold. Mode of access: Internet Miao, Yanliang. Wu, Weifeng. IMF Working Papers; Working Paper ; No. 2011/064 Full text available on IMF http://elibrary.imf.org/view/journals/001/2011/064/001.2011.issue-064-en.xml IMF e-Library