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Spatial Price Transmission in Kazakh Wheat Markets

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  • Yakhshilikov, Yorbol
  • Brosig, Stephan

Abstract

Reliable marketing opportunities in both interregional and international trade are an important precondition for further development of the agricultural sector. In this study we assess interregional integration of Kazakh wheat markets. We apply asymmetric threshold error correction models to assess the co-movement of elevator prices at three grain-trading spots in the northern and central parts of the country. Results suggest that markets of two northern grain-trading spots (Petropavlovsk and Kokshetau) are closely connected with each other while their connection with Karaganda in central Kazakhstan is much weaker. Here, levelling out price gaps through arbitrage trade only occurs after a threshold of considerable extent has been surpassed.

Suggested Citation

  • Yakhshilikov, Yorbol & Brosig, Stephan, 2006. "Spatial Price Transmission in Kazakh Wheat Markets," 2006 Annual Meeting, August 12-18, 2006, Queensland, Australia 25690, International Association of Agricultural Economists.
    • Handle: RePEc:ags:iaae06:25690
    DOI: 10.22004/ag.econ.25690
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    References listed on IDEAS

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    1. 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.
    2. Engle, Robert & Granger, Clive, 2015. "Co-integration and error correction: Representation, estimation, and testing," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 39(3), pages 106-135.
    3. 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.
    4. Meyer, Jochen, 2004. "Measuring market integration in the presence of transaction costs--a threshold vector error correction approach," Agricultural Economics, Blackwell, vol. 31(2-3), pages 327-334, December.
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    Cited by:

    1. Jan Fałkowski, 2010. "Price transmission and market power in a transition context: evidence from the Polish fluid milk sector," Post-Communist Economies, Taylor & Francis Journals, vol. 22(4), pages 513-529.
    2. O'Brien, Daniel M., 2009. "The Effects of the Micro-Market Structure for Kansas Grain Elevators on Spatial Grain Price Differentials," 2009 Conference, April 20-21, 2009, St. Louis, Missouri 53041, NCCC-134 Conference on Applied Commodity Price Analysis, Forecasting, and Market Risk Management.

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