Mette Ejrnæs (Institute of Economics, University of Copenhagen) Karl Gunnar Persson (Institute of Economics, University of Copenhagen) Søren Rich (Institute of Economics, University of Copenhagen)
Abstract
This paper traces the evolution of the international market for wheat from an emerging market structure after the repeal of the Corn Laws to a mature market characterized by efficient arbitrage after the introduction of the transatlantic telegraph and the growth of trade. Efficiency is documented using traditional price gap accounting as well as error correction modelling. Markets which traded directly with each other as well as markets which did not trade with each other were integrated. The traditional bi-lateral focus in market integration studies has been extended to a multi-variate approach which generates new insights as to the pattern of diffusion of price shocks in the international economy. Shocks in the major importing nation, Britain, dominated in the emerging market phase while shocks in the major exporting economy, United States, dominated international prices movements at the end of the 19th century.
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Paper provided by University of Copenhagen. Department of Economics in its series Discussion Papers with number
04-28.
Length: 30 pages Date of creation: Nov 2004 Date of revision: Handle: RePEc:kud:kuiedp:0428
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Find related papers by JEL classification: N7 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services
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