Asymmetry in farm to retail price transmission: Evidence from Brazil
AbstractIn this article, we describe the price transmission mechanism for three groups of agricultural products in Brazil to determine if they follow the pattern found in previous studies. These groups combine different dimensions of the two arguments normally used to explain price asymmetry: market concentration and product storability. Results from the study area in Brazil showed that neither product storability nor market concentration were required for intense price-increase transmission. High and increasing Brazilian inflation rates found through 1994 led the population to expect continual price increases; the society may have been able to assimilate the most intense transmissions of price increments, independent of industry market power. Consequently, our results demonstrate that the findings from previous price transmission studies cannot be generalized to other industries or for other periods. New theoretical and empirical studies are needed to improve our understanding of asymmetrical price transmission. [EconLit Citations: L660, 810] © 2002 Wiley Periodicals, Inc.
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Bibliographic InfoArticle provided by John Wiley & Sons, Ltd. in its journal Agribusiness.
Volume (Year): 18 (2001)
Issue (Month): 1 ()
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Web page: http://onlinelibrary.wiley.com/journal/10.1002/(ISSN)1520-6297
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- Bernard, John C. & Willett, Lois Schertz, 1996. "Asymmetric Price Relationships In The U.S. Broiler Industry," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 28(02), December.
- Granger, C W J, 1969. "Investigating Causal Relations by Econometric Models and Cross-Spectral Methods," Econometrica, Econometric Society, vol. 37(3), pages 424-38, July.
- Azzeddine M. Azzam, 1999. "Asymmetry and Rigidity in Farm-Retail Price Transmission," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 81(3), pages 525-533.
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