Food scares, market power and price transmission: the UK BSE crisis

Lloyd, T A; McCorriston, Steve; Morgan, C. Wyn; Rayner, A. J.

doi:10.1093/erae/jbl001

Cited by 103 publications

(80 citation statements)

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“…The value of 1,4852 expresses price transmission elasticity. The value is higher than 1 and therefore an imperfect market structure is considered; more specifically oligopoly or oligopsony power is presented meaning that the market power is on the demand side according to Lloyd et al (2004); this means that processors have a stronger power than producers. The price elasticity says that increase in PP price by 1,00 per cent results in rise of FPI by 1,49 per cent.…”

Section: Resultsmentioning

confidence: 99%

“…The Beta transported shows the nature of the market structure. The value is higher than 1, therefore an imperfect market structure is considered; more specifically, oligopoly and oligopsony power can be found in the market according to Lloyd et al (2004). The price elasticity says that increase in consumer price by 1,00 per cent results in increase of processor price by 1,3099 per cent.…”

Section: Dickey-fuller Test On Residuals P-value 003015mentioning

confidence: 99%

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Vertical price transmission analysis: the case of milk in the Slovak dairy sector

Lajdova

Bielik

2013

APSTRACT

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Abstract:Testing for nature price transmission and calculating elasticities of price transmission are important areas of research for providing insights into market efficiency issues. Symmetric or asymmetric price transmission has been the subject of considerable attention in agricultural economics. The concept of the price transmission is an important area of the research particularly in relation to the assessment of impact on the welfare of the vertical entities. The main goal of the paper is an analysis of the price transmission and its exploitation in case of price elasticity estimation in dairy sector. Work investigates vertical price transmission of milk in the Slovak agri-food chain. The research is based on Vector Error Correction Model (VECM) of the selected commodities at producer, processor and consumer level and the estimation of the parameters specified in the model. Moreover the paper determines the coefficient of elasticity of price transmission (EPT).

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Section: Resultsmentioning

confidence: 99%

Section: Dickey-fuller Test On Residuals P-value 003015mentioning

confidence: 99%

Vertical price transmission analysis: the case of milk in the Slovak dairy sector

Lajdova

Bielik

2013

APSTRACT

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“…As noted above, some evidence has suggested that the BSE crisis had an impact on the vertical price transmission processes (Lloyd et al, 2001(Lloyd et al, , 2006. The degree to which price transmission is affected by a food scare crisis is likely to depend on the scale of the crisis.…”

Section: The Food Scare Information Indexmentioning

confidence: 96%

Price transmission in the Spanish bovine sector: the BSE effect

Hassouneh

Serra

Gil

2010

Agricultural Economics

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A regime-switching vector error correction model is applied to monthly price data to assess the impact of BSE outbreaks on price relationships and patterns of transmission among farm and retail markets for bovine in Spain. To evaluate the degree to which price transmission is affected by BSE food scares, a BSE food scare index is developed and used to determine regime-switching.Results suggest that BSE scares affect beef producers and retailers differently. Consumer prices are found to be weakly exogenous and not found to react to BSE scares, while producer prices conversely adjusted. The magnitude of the adjustment is found to depend on the magnitude of the BSE scare.

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“…Lloyd et al (2006), Saghaian (2007), and Hassouneh et al (2010) investigate the impact of BSE on price transmissions in the beef market. Both Lloyd et al (2006) and Hassouneh et al (2010) address issues of human health and food scares within the UK and Spain by examining the impact of BSE on the retail and producer levels. They find different impacts between beef producers and retailers.…”

mentioning

confidence: 99%

“…They find different impacts between beef producers and retailers. However, the main difference between studies is that Lloyd et al (2006) did not consider any threshold component. Saghaian (2007) evaluated the implications of the 2003 BSE outbreak on a feedlot, wholesale, and retail beef prices.…”

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confidence: 99%