A note on the correspondence between horizontal and vertical price transmission

Kinnucan, Henry W.

doi:10.1111/1477-9552.12483

Cited by 3 publications

(1 citation statement)

References 16 publications

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“…Over the 18‐year period that we analyse, important components of trade costs in China have changed, with fuel prices, for example, increasing by 100% and then falling by 30% over our sample period. Since we do not include any measures of trade costs, our first‐step price transmission estimates are likely biased downwards ( as explained by Kinnucan, 2022— Ed .). However, the extent of this bias will depend on the strength of the covariance between prices and trade costs, and in our setting the problem would appear to be relatively limited, as the majority of our price transmission estimates range between 0.85 and 1, and none are smaller than 0.7 (see Figure 1).…”

Section: Conclusion and Suggestions For Future Researchmentioning

confidence: 99%

Estimating dynamic market efficiency frontiers

Cramon‐Taubadel

2022

J Agricultural Economics

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Past studies have used standard regression techniques to explain variation in estimated measures of the strength and speed of price transmission. We propose an alternative method for benchmarking the magnitude and the speed of restoring market efficiency that combines cointegration analysis with frontier estimation methods. The use of frontier methods highlights that market efficiency is a relative concept, and it provides a convenient way of accounting for sampling error in estimated measures of price transmission. We illustrate the proposed method using price data from 30 provincial pork markets in China from 2000 to 2017. As expected, the frontier magnitude and speed of restoring market efficiency both fall with increasing distance between two markets. We find significant province effects in the magnitude of market efficiency. Provinces located farther to the south and west display lower levels of market efficiency than those located in the northeast and central regions of China.

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Section: Conclusion and Suggestions For Future Researchmentioning

confidence: 99%

Estimating dynamic market efficiency frontiers

Cramon‐Taubadel

2022

J Agricultural Economics

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Asymmetric price transmission in perishable crops value chain: A NARDL approach

Sharma,

Meena,

Anwer

2024

Agribusiness

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Policymakers and economists envisage effective price transmission across markets or stakeholders in supply chains as a vital contributor to market efficiency. The paper explores the vertical price transmission in the perishables supply chain in India using weekly data on farm, wholesale and retail prices collected from main production and consumption markets. We estimate the asymmetries in price transmission using the nonlinear autoregressive distributed lags model and found the asymmetry in both magnitude and speed in the case of wholesale–retail chain of Onion and Potato, asymmetry in magnitude in wholesale–retail chain of Tomato, and asymmetry in speed in farm–wholesale chain of Potato. The results of asymmetric coefficient, long‐run elasticity of price transmission, speed of adjustment and implied half‐life of disequilibrium indicated that farm–wholesale chain is more efficient than wholesale–retail chain. Further, market chains of Onion and Tomato are more efficient than Potato chains. The magnitude of the adjustment was found to be larger for the long‐run positive shock in wholesale–retail market chain of Onion, Potato and Tomato, and it concluded that retailers enjoy an advantage over wholesalers as well as farmers. We draw interesting policy considerations for the perishables sector [EconLit Citations: Q11, Q13, C32].

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COVID-19 Impacts on United States Crawfish

Nguyen

Schmitz

Kennedy

2022

Journal of Agricultural &Amp; Food Industrial Organization

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This research determines the impacts of COVID-19 US on crawfish production and consumption for 2020 and 2021 using an Equilibrium Displacement Model. In the US, crawfish is one of the seafood commodities where most production is consumed by domestic consumers (7% of domestic consumption is from imports). Crawfish and rice are complementary. Therefore, the impacts of COVID-19 on crawfish consumption simultaneously influence rice production and crawfish producers and consumers. In the first year of COVID-19 (2020), the reduction in crawfish retail demand caused negative effects on final consumers and producers. However, crawfish consumption recovered significantly in the second year (2021), which could compensate for the loss in 2020. Overall, consumer and producer gains ranged from $549 to $626 million if the COVID-19 pandemic only impacted retail consumption. However, in 2021, the increase in production costs due to higher oil/diesel prices and other input prices caused the farm supply to decrease. As a result, total welfare gains ranged from $200 to $228 million. If the demand in 2021 did not increase, but the crawfish farm supply decreased, consumer and producer losses ranged from $929 to $1045 million. Overall, the total effects of COVID-19 on consumers and producers for 2020 and 2021 depend on its effects in 2021. If the demand in 2021 increased following the decrease in farm supply, consumers and producers would benefit from the shocks of COVID-19 due to higher post-COVID-19 demand.

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A note on the correspondence between horizontal and vertical price transmission

Cited by 3 publications

References 16 publications

Estimating dynamic market efficiency frontiers

Estimating dynamic market efficiency frontiers

Asymmetric price transmission in perishable crops value chain: A NARDL approach

COVID-19 Impacts on United States Crawfish

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