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The price transmission in pork meat agri-food chain

Author

Listed:
  • L. Čechura

    (Czech University of Life Sciences, Prague, Czech Republic)

  • L. Šobrová

    (Czech University of Life Sciences, Prague, Czech Republic)

Abstract

The paper deals with the analysis of price transmission in pork meat agri-food chain. The analysis is aimed at the determination of the type of market structure in the chain based on the derived theoretical model and fitted reduced model of price transmission in the form of VECM. Then, impulse-response analysis and decomposition of variance of fitted VECM show the system's reaction to innovations and the interaction between variables for longer forecast horizons. The results imply that processing stage may exercise oligopsonic power, i.e. the market structure has the type of oligopsony. Impulse-response analysis shows that the system approaches relatively fast the equilibrium and all responses are positive. Moreover, decomposition of variance informs about the increasing role of the wholesale price in the explanation of forecast error variance of agricultural price. Then, it follows from the obtained results (among other) that the pork meat agri-food chain may be characterised as demand-driven. The type of market structure implies that the agricultural support is in this case shared within the vertically related markets and thus is less efficient.

Suggested Citation

  • L. Čechura & L. Šobrová, 2008. "The price transmission in pork meat agri-food chain," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 54(2), pages 77-84.
    • Handle: RePEc:caa:jnlage:v:54:y:2008:i:2:id:272-agricecon
    DOI: 10.17221/272-AGRICECON
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    Citations

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    Cited by:

    1. Tamara Rudinskaya & Iveta Boskova, 2021. "Asymmetric price transmission and farmers' response in the Czech dairy chain," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 67(5), pages 163-172.
    2. Jung Hun HAN & Byeong-Il AHN, 2015. "Multiple-regime price transmission between wheat and wheat flour prices in Korea," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 61(12), pages 552-563.
    3. Dagmar Matošková, 2011. "Volatility of agrarian markets aimed at the price development," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 57(1), pages 35-40.
    4. Jindrich SPICKA & Zdenka NAGLOVA & Martin GURTLER, 2017. "Effects of the investment support in the Czech meat processing industry," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 63(8), pages 356-369.

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