IDEAS home Printed from
   My bibliography  Save this article

Price Transmission Asymmetry in Spatial Grain Markets in Ethiopia


  • Kifle Wondemu


Acknowledging the link between competitive and efficient spatial agricultural markets and farm productivity, the government of Ethiopia has implemented various market enhancing policy and institutional measures. The effectiveness of these measures to achieve their policy goals, among others, depends on the degree of symmetry prices transmit across spatial markets as well as on the efficiency of spatial arbitrage. We tested the presence of asymmetric price adjustment in the spatial grain markets in Ethiopia. The result provided clear evidence of asymmetric price adjustment for teff crops, but not for maize. For teff crops, prices adjust quickly to shocks that increase price than shocks that reduce prices. The analysis on the efficiency of the grain markets also showed that the spatial markets are characterized by a significant level of inefficiency. Although further research is necessary to establish the real causes for the observed asymmetric price transmission and market inefficiency, the finding suggests that departure from perfectly competitive settings are partly to be blamed for the recent food crops price hikes. In addition to their undesirable redistributional consequences, price transmissions asymmetry and inefficiency are expected to entail efficiency loss. Future empirical work in this area should strive to explain the underlying reasons for the observed asymmetric price transmission and market inefficiency.

Suggested Citation

  • Kifle Wondemu, 2015. "Price Transmission Asymmetry in Spatial Grain Markets in Ethiopia," African Development Review, African Development Bank, vol. 27(2), pages 106-116, June.
  • Handle: RePEc:bla:afrdev:v:27:y:2015:i:2:p:106-116
    DOI: 10.1111/1467-8268.12127

    Download full text from publisher

    File URL:
    Download Restriction: no


    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    Cited by:

    1. Lanie Tomgouani, 2018. "Working Paper 306 - Asymmetric Price Transmission of Rice in Togo," Working Paper Series 2427, African Development Bank.
    2. Tsiboe, Francis & Dixon, Bruce L. & Wailes, Eric J., 2016. "Spatial dynamics and determinants of Liberian rice market integration," African Journal of Agricultural and Resource Economics, African Association of Agricultural Economists, vol. 11(3).

    More about this item


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:afrdev:v:27:y:2015:i:2:p:106-116. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wiley Content Delivery). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.