Market Integration: Case Studies of Structural Change
AbstractThe grain/oilseed industry is undergoing considerable structural change through mergers and new value-added businesses, which raises price-related questions. We analyze the level of price integration prior to and following a merger between two grain firms and the start-up of a producer-owned ethanol facility. This research utilizes error correction vector autoregression analysis to compute market integration structural change effects. We find evidence that market integration initially increases with the merger, but deteriorates with time following the merger. We find no significant localized change in the level of price integration for the case of a new value-added business.
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Bibliographic InfoArticle provided by Northeastern Agricultural and Resource Economics Association in its journal Agricultural and Resource Economics Review.
Volume (Year): 34 (2005)
Issue (Month): 2 (October)
consolidation; structural change; price integration; Agribusiness; Industrial Organization;
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