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A Note on Price Levelling and Price Averaging in Sydney Retail Vegetable Price Spreads

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Listed:
  • Griffith, Garry R.
  • Jamandre, W.E.
  • Piggott, Roley R.

Abstract

For tomatoes, potatoes, carrots and onions in the Sydney market, the degree of variability of the retail price is substantially lower than the degree of variability of the wholesale price. The objective here is to investigate whether fresh vegetable retailers in the Sydney market practice price levelling and price averaging. 2SLS and 3SLS procedures were used to estimate a system of price spread equations for the four vegetables using quarterly data from 1980 to 1990. In the preferred 3SLS estimates price levelling was confirmed for potatoes and carrots. Price levelling was not evident in the tomatoes and onions equations, with price transmission influenced more by markup pricing policies for these vegetables. No evidence of price-averaging behaviour was found for any of the vegetables examined.

Suggested Citation

  • Griffith, Garry R. & Jamandre, W.E. & Piggott, Roley R., 1992. "A Note on Price Levelling and Price Averaging in Sydney Retail Vegetable Price Spreads," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 60(01), pages 1-13, April.
    • Handle: RePEc:ags:remaae:12502
    DOI: 10.22004/ag.econ.12502
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    References listed on IDEAS

    as
    1. Ronald W. Ward, 1982. "Asymmetry in Retail, Wholesale, and Shipping Point Pricing for Fresh Vegetables," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 64(2), pages 205-212.
    2. Griffith, Garry R., 1974. "Sydney Meat Marketing Margins - An Econometric Analysis," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 42(04), pages 1-17, December.
    3. John C. Naughtin & John J. Quilkey, 1979. "Pricing Efficiency In The Retail Meat Market," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 23(1), pages 48-61, April.
    4. Griffith, Garry R. & Green, W. & Duff, G.L., 1991. "Another Look at Price Levelling and Price Averaging in the Sydney Meat Market," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 59(02), pages 1-13, August.
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    Keywords

    Demand and Price Analysis;

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