Spatial Market Integration and Price Transmission of Cowpea (Beans) in Nigeria

The study analyzed market integration of cowpea between source market of Gombe State and destination markets of Abia, Enugu and Imo States. It used secondary data sources of monthly cowpea prices obtained from National Bureau of Statistics (NBS). The study tested the stationarity of the data series then used the first difference of the series for the study. It also conducted a cointegrated tested using the Johansen model. The trace and eigenvalue tests indicated one cointegrating vector between the source market and destination market prices of cowpea implying that the two price series were cointegrated. The ARDL model was used to establish the existence of long run relationship in the prices of cowpea from the different markets. The result of the bound test of the ARDL shows that there was a long run relationship between source and destination markets since the computed F- statistic was greater than both lower and the upper bound values at all level of significance tested ranging from 1-10 levels of significance. The study therefore concluded that there was a long run relationship in the prices of cowpea among the markets. An ECM value of -0.673was obtained. This implies that, the rate of adjustment of price of67 percent, was a fast rate of adjustment of the markets prices to equilibrium. The study recommends that government should provide good road network system between the source market and the destination markets which could further enhance market integration.