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The Dynamics of Price Transmission in the Presence of a Major Quality Differential: The Case of Colombian Milds and Vietnamese Robusta Coffee Beans

Author

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  • Li, Xi-Le
  • Saghaian, Sayed H.

Abstract

This study applies an Error Correction Model to identify the price links between the grower price and the world price for Colombian Milds and Vietnamese Robusta, focusing on both the long-run relationships and short-run adjustments. The long-run relationships between the world price and grower price are statistically significant for both Colombian Milds and Vietnamese Robusta. The short-run price adjustments toward equilibrium are asymmetric for both types. The degree of market integration for Colombian Milds is slightly higher than for Robusta. The results have policy implications for the two quality-differentiated green coffee beans.

Suggested Citation

  • Li, Xi-Le & Saghaian, Sayed H., 2013. "The Dynamics of Price Transmission in the Presence of a Major Quality Differential: The Case of Colombian Milds and Vietnamese Robusta Coffee Beans," Journal of Agribusiness, Agricultural Economics Association of Georgia, vol. 31(1).
    • Handle: RePEc:ags:jloagb:311184
    DOI: 10.22004/ag.econ.311184
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    Cited by:

    1. Mai, Thang Chien & Shakur, Shamim & Cassells, Sue, 2018. "Testing vertical price transmission for Vietnam’s Robusta coffee," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 62(4), October.

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    Keywords

    Agribusiness;

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