Spatial Distribution of the International Food Prices: Unexpected Heterogeneity and Randomness

Distefano, Tiziano; Chiarotti, G.; Laio, Francesco; Ridolfi, Luca

doi:10.1016/j.ecolecon.2019.01.010

Cited by 9 publications

(4 citation statements)

References 53 publications

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“…Also, there is a long-run equilibrium for Slovenian wheat market prices. Distefano examined the rise of arbitrariness in the price formation mechanism [25].…”

Section: Review Of Literaturementioning

confidence: 99%

Threshold Cointegration and Price Transmission in Commodity Marketsof India

Mishra,

Kumar

2023

jour

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The purpose of this research work is to examine the relationships and price dynamics between agricultural commodities in India, i.e.maize, wheat, barley and soybean. Our approach is to study the long-term relationship using the method of modelling the price transmission for both linear and threshold autoregressive (AR) models and vector error correction (VEC) models. Results revealed that all the price series are well integrated, and threshold error correction models prove that all price series move to restore the long-run relationship, whereas commodity stock prices respond slightly faster than market prices in the short-run. Conclusions from this study show that understanding the price transmission flow and its impact on pricing might help in making better trading strategies. It also regulates the public policy implications of the active participation of farmers in national-level commodity exchanges.

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“…Also, there is a long-run equilibrium for Slovenian wheat market prices. Distefano examined the rise of arbitrariness in the price formation mechanism [25].…”

Section: Review Of Literaturementioning

confidence: 99%

Threshold Cointegration and Price Transmission in Commodity Marketsof India

Mishra,

Kumar

2023

jour

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“…Given the general lack of data at the sub‐national level, it is not uncommon for methodological research of the type conducted here to experiment with international trade datasets like WIOD (e.g., Lamonica & Chelli, 2018; Sargento et al, 2012). For our purposes, WIOD presents two advantages over raw trade statistics (e.g., UN Comtrade): first, it contains no trade asymmetries, as all discrepancies between mirror flows were removed in the harmonization process (Distefano, Chiarotti, Laio, & Ridolfi, 2019; Gehlhar & Pick, 2002); second, it includes information on how much each country trades with itself.…”

Section: Dcgm Estimation With Real Data: An Examplementioning

confidence: 99%

Doubly constrained gravity models for interregional trade estimation

Cai

2021

Papers in Regional Science

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This paper discusses a family of methods grounded in the doubly constrained gravity model (DCGM) for the estimation of product‐specific origin–destination matrices of interregional trade. We argue that several estimation procedures documented in the literature, although outwardly unrelated, can be conceptualized as applications of the DCGM framework. We show that DCGM estimation requires less restrictive assumptions and fewer data than commonly thought. We demonstrate that, in ideal conditions, the unknown trade flows can be recovered exactly through a standard application of the RAS algorithm. Finally, we examine how a DCGM estimator might fare in applications using Monte Carlo techniques and give an example of its use with real‐world data.

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“…Using a pairwise approach based on CPI (consumer price index) data for 153 goods, Iregui and Otero [20] find that food spatial market integration is more significant in unprocessed food products than in processed foods, other traded products, and nontraded products, and apart from nontraded products, the speed of food price differentials adjustment decreases with distance. Based on the international food trade network, Distefano et al [21] analyze food spatial price dispersion and stochastic price distribution, finding that food spatial bilateral price dispersion is significant and continuous, indicating failure of the LOP; food price discrimination and food spatial price dispersion can be distinguished; and food price spikes and food price peaks are typically strongly correlated, leading to more severe food market fragmentation and food price discrimination in the wake of food price crises. (iv) Food price risk caused by food scare.…”

Section: Literature Review and Hypothesesmentioning

confidence: 99%

Food Safety Incident, Public Health Concern, and Risk Spillover Heterogeneity: Avian Influenza Shocks as Natural Experiments in China’s Consumer Markets

Tao

Zhu

et al. 2019

IJERPH

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Background: Food safety incidents have aroused widespread public health concern, causing food price risk. However, the causal paths remain largely unexplored in previous literature. This paper sets out to identify the relations of local and spatial spillovers of food safety incidents and public health concerns to food price risk in consumer markets within a setting with heterogeneous food safety risk levels. Methods: (i) Theoretically, unlike prior work, this paper decomposes food safety risks into food safety incidents (objective incident component) and public health concern (subjective concern component). This article develops a theoretical framework of causality to capture the underlying causal pathways motivated by the theories of limited attention and two-step flow of communication. (ii) Empirically, using avian influenza shocks in China’s poultry markets as natural experiments, this paper differentiates between low- and high-risk food and incidents. The article adopts dynamic spatial panel models to analyze potential nonlinearity, moderation, and mediation in the spillover of food safety risk to food price risk for a long panel of 30 provinces covering the November 2007 to November 2017 period. Results: (i) Food safety incident alone only triggers high-risk food price risk, not low-risk food price risk. (ii) Public health concern amplifies nonlinear food price risk triggered by food safety incident. (iii) High-risk incident intensifies negative pressure of public health concern on food price risk. (iv) Food safety incident indirectly affects high-risk food price risk through public health concern. Conclusions: Using a setting with heterogeneous risk levels, this paper documents that (i) food safety incident itself does not necessarily determine food price risk, whereas it is actually public health concern that directly causes nonlinear food price risk; (ii) public health concern spillover to food price risk is negatively moderated by high-risk incident, and (iii) food safety incident spillover to high-risk food price risk is mediated by public health concern. The findings complement current research by (i) elucidating the diverse impacts of food safety incident and public health concern on food price risk, which are obscure in previous literature, and (ii) highlighting that heterogeneous food and incident risk levels matter for determining food price risk spillover.

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Spatial Distribution of the International Food Prices: Unexpected Heterogeneity and Randomness

Cited by 9 publications

References 53 publications

Threshold Cointegration and Price Transmission in Commodity Marketsof India

Threshold Cointegration and Price Transmission in Commodity Marketsof India

Doubly constrained gravity models for interregional trade estimation

Food Safety Incident, Public Health Concern, and Risk Spillover Heterogeneity: Avian Influenza Shocks as Natural Experiments in China’s Consumer Markets

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