Spatial Price Adjustment with and without Trade
AbstractIn this paper we introduce a switching error correction model (SECM) estimator that allows for the possibility that price transmission between markets might vary during periods with and without physical trade flows. Applying this new approach to semi-weekly data on tomato markets in Zimbabwe, we find that intermarket price adjustment occurs quickly and as much when there is no trade as when product flows from one market to another. This finding underscores the importance of information flow for market performance.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association) in its series 2008 Annual Meeting, July 27-29, 2008, Orlando, Florida with number 6538.
Date of creation: 2008
Date of revision:
Contact details of provider:
Postal: 555 East Wells Street, Suite 1100, Milwaukee, Wisconsin 53202
Phone: (414) 918-3190
Fax: (414) 276-3349
Web page: http://www.aaea.org
More information through EDIRC
Marketing; Research Methods/ Statistical Methods; Q13; R12; C32; P42;
Find related papers by JEL classification:
- Q13 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Markets and Marketing; Cooperatives; Agribusiness
- R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
- C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
- P42 - Economic Systems - - Other Economic Systems - - - Productive Enterprises; Factor and Product Markets; Prices
This paper has been announced in the following NEP Reports:
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Andrews, Donald W K, 1993.
"Tests for Parameter Instability and Structural Change with Unknown Change Point,"
Econometric Society, vol. 61(4), pages 821-56, July.
- Donald W.K. Andrews, 1990. "Tests for Parameter Instability and Structural Change with Unknown Change Point," Cowles Foundation Discussion Papers 943, Cowles Foundation for Research in Economics, Yale University.
- Muleta, Asfaw Negassa & Myers, Robert J., 2007.
"AJAE Appendix: Estimating Policy Effects on Spatial Market Efficiency: An Extension to the Parity Bounds Model,"
American Journal of Agricultural Economics Appendices,
Agricultural and Applied Economics Association, vol. 89(2), May.
- Asfaw Negassa & Robert J. Myers, 2007. "Estimating Policy Effects on Spatial Market Efficiency: An Extension to the Parity Bounds Model," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 89(2), pages 338-352.
- Goodwin, Barry K. & Piggott, Nicholas E., 1999.
"Spatial Market Integration In The Presence Of Threshold Effects,"
1999 Annual meeting, August 8-11, Nashville, TN
21489, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
- Barry K. Goodwin & Nicholas E. Piggott, 2001. "Spatial Market Integration in the Presence of Threshold Effects," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 83(2), pages 302-317.
- Gonzalo, J. & Pitarakis, J., 2005.
"Threshold effects in cointegrating relationships,"
Discussion Paper Series In Economics And Econometrics
0506, Economics Division, School of Social Sciences, University of Southampton.
- Deaton, Angus & Laroque, Guy, 1996. "Competitive Storage and Commodity Price Dynamics," Journal of Political Economy, University of Chicago Press, vol. 104(5), pages 896-923, October.
- Paul L. Fackler & H�seyin Tastan, 2008. "Estimating the Degree of Market Integration," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 90(1), pages 69-85.
- Hansen, Bruce E. & Seo, Byeongseon, 2002.
"Testing for two-regime threshold cointegration in vector error-correction models,"
Journal of Econometrics,
Elsevier, vol. 110(2), pages 293-318, October.
- Tom Doan, . "RATS programs to replicate Hansen/Seo paper on threshold cointegration," Statistical Software Components RTZ00092, Boston College Department of Economics.
- Stefan Dercon & Bjorn Van Campenhout, 1999. "Dynamic Price Adjustment in Spatially Separated Food Markets with Transaction Costs," Center for Economic Studies - Discussion papers ces9909, Katholieke Universiteit Leuven, Centrum voor Economische Studiën.
- Fackler, Paul L. & Goodwin, Barry K., 2001. "Spatial price analysis," Handbook of Agricultural Economics, in: B. L. Gardner & G. C. Rausser (ed.), Handbook of Agricultural Economics, edition 1, volume 1, chapter 17, pages 971-1024 Elsevier.
- Bob Baulch, 1997. "Transfer Costs, Spatial Arbitrage, and Testing for Food Market Integration," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(2), pages 477-487.
- Christopher B. Barrett, 1996. "Market Analysis Methods: Are Our Enriched Toolkits Well Suited to Enlivened Markets?," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 78(3), pages 825-829.
- Christopher B. Barrett & Jau Rong Li, 2002. "Distinguishing between Equilibrium and Integration in Spatial Price Analysis," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 84(2), pages 292-307.
- Nathan S. Balke & Thomas B. Fomby, 1992.
9209, Federal Reserve Bank of Dallas.
- Robert Jensen, 2007. "The Digital Provide: Information (Technology), Market Performance, and Welfare in the South Indian Fisheries Sector," The Quarterly Journal of Economics, MIT Press, vol. 122(3), pages 879-924, 08.
- Araujo-Enciso, Sergio Rene, 2009. "Evidence of non-linear price transmission between maize markets in Mexico and the US," 2009 Conference, August 16-22, 2009, Beijing, China 51366, International Association of Agricultural Economists.
- Traub, Lulama Ndibongo & Myers, Robert J. & Jayne, Thomas S. & Meyer, Ferdinand H., 2010. "Measuring Integration and Efficiency in Maize Grain Markets: The Case of South Africa and Mozambique," 2010 AAAE Third Conference/AEASA 48th Conference, September 19-23, 2010, Cape Town, South Africa 96644, African Association of Agricultural Economists (AAAE) & Agricultural Economics Association of South Africa (AEASA).
- Loening, Josef L. & Durevall, Dick & Ayalew Birru, Yohannes, 2009.
"Inflation Dynamics and Food Prices in an Agricultural Economy: The Case of Ethiopia,"
Working Papers in Economics
347, University of Gothenburg, Department of Economics.
- Loening, Josef L. & Durevall, Dick & Birru, Yohannes A., 2009. "Inflation dynamics and food prices in an agricultural economy : the case of Ethiopia," Policy Research Working Paper Series 4969, The World Bank.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search).
If references are entirely missing, you can add them using this form.